**Exhibit 2.1**

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***EXECUTION VERSION***

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**AGREEMENT AND PLAN OF MERGER**

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**by and between**

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**Majesco**

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**and**

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**Cover-All Technologies Inc.**

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**Dated as of December 14, 2014**

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**TABLE OF CONTENTS**

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**AGREEMENT AND PLAN OF MERGER**

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This AGREEMENT AND PLAN OF MERGER (this “Agreement”)is made and entered into as of December 14, 2014, by and between Majesco, a California corporation (“MM”),and Cover-All Technologies Inc., a Delaware corporation (the “Company”).

 

**RECITALS:**

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A.   Upon the terms andsubject to the conditions set forth in this Agreement and in accordance with the Delaware General Corporation Law (the “DGCL”)and the California General Corporation Law (“CGCL”), MM and the Company intend to enter into a business combinationtransaction.

 

B.   The Board of Directorsof MM has (i) determined that the Merger and the other transactions contemplated hereby are fair to and in the best interests ofMM and its stockholders, (ii) unanimously approved this Agreement, the Merger and the other transactions contemplated hereby and(iii) determined to recommend that the stockholders of MM adopt and approve this Agreement, the Merger and the other transactionscontemplated hereby.

 

C.   The Board of Directorsof the Company (the “Company Board”) has (i) determined that the Merger and the other transactions contemplatedhereby are fair to and in the best interests of the Company and its stockholders, (ii) unanimously approved this Agreement, theMerger and the other transactions contemplated hereby, and (iii) determined to recommend that the stockholders of the Company adoptand approve this Agreement, the Merger and the other transactions contemplated in this Agreement.

 

D.   Concurrently with theexecution of this Agreement, and as a condition and inducement to MM’s willingness to enter into this Agreement, certainAffiliates of the Company are entering into a Voting Agreement, in the form attached hereto as Exhibit A (the “VotingAgreement”).

 

E.   The parties heretointend, for federal income tax purposes, that the Merger shall qualify as a “reorganization” within the meaning ofSection 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”).

 

**AGREEMENT**

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NOW, THEREFORE, in consideration of foregoingpremises, the mutual covenants, promises and representations set forth herein, and for other good and valuable consideration, thereceipt and sufficiency of which are hereby acknowledged and accepted, the parties hereto hereby agree as follows:

 

**ArticleI**** **

**THE MERGER AND EFFECT ON CAPITAL STOCK**

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1.1.   The Merger.   Atthe Effective Time and subject to and upon the terms and conditions of this Agreement and the applicable provisions of the CGCLand the DGCL, the Company shall be merged with and into MM (the “Merger”), the separate corporate existenceof the Company shall cease and MM shall continue as the surviving corporation in the Merger. MM, as the surviving corporation inthe Merger, is hereinafter sometimes referred to as the “Surviving Corporation.” As a result of the Merger,the outstanding shares of capital stock of the Company shall be converted or cancelled in the manner provided herein.

 

1.2.   Effective Time;Closing.   Subject to the provisions of this Agreement, the parties hereto shall cause the Merger to be consummatedby filing Certificates of Merger in the forms attached hereto as Exhibit B with the Secretary of State of the State of Californiain accordance with the relevant provisions of the CGCL and the Secretary of State of the State of Delaware in accordance with therelevant provisions of the DGCL (the “Certificates of Merger”) (the time of such filing (or such later timeas may be agreed in writing by the Company and MM and specified in the Certificates of Merger) being referred to herein as the“Effective Time”) on the Closing Date. The Merger will become effective at the Effective Time. The closing ofthe Merger and the other transactions contemplated hereby (the “Closing”) shall take place at the offices ofPepper Hamilton LLP, 620 Eighth Avenue, New York, New York, 10018, at a time and date to be specified by the parties hereto, whichtime and date shall be no later than the second (2nd) Business Day after the satisfaction or waiver of the conditions set forthin Article VI hereof  (other than those conditions

 

 

that by their nature are to be satisfied at the Closing, butsubject to the satisfaction of or, to the extent permitted hereunder, waiver of all such conditions), unless this Agreement hasbeen terminated pursuant to its terms, or at such other location, time and date as the parties hereto shall mutually agree in writing(the date upon which the Closing actually occurs being referred to herein as the “Closing Date”).

 

1.3.   Effect of theMerger.   At the Effective Time, the effect of the Merger shall be as provided in this Agreement and the applicableprovisions of the CGCL and the DGCL.

 

1.4.   Articles of Incorporation;Bylaws.

 

(a)   Articles of Incorporation.   Atthe Effective Time, the Articles of Incorporation of MM as amended and restated in the form attached as Exhibit C heretoshall become the Articles of Incorporation of the Surviving Corporation until thereafter amended in accordance with the CGCL andsuch Articles of Incorporation (except as otherwise restricted under Section 5.13 of this Agreement).

 

(b)   Bylaws.   Atthe Effective Time, the Bylaws of MM as amended and restated in the form attached as Exhibit D hereto shall become the Bylawsof the Surviving Corporation until thereafter amended in accordance with the CGCL, the Articles of Incorporation of the SurvivingCorporation and such Bylaws (except as otherwise restricted under Section 5.13 of this Agreement).

 

1.5.   Directors andOfficers.

 

(a)   Directors.   Fromand after the Effective Time, the Board of Directors of the Surviving Corporation shall consist of  (i) Arun Maheshwari(Executive Chairman), (ii) Earl Gallegos (Vice Chairman), (iii) Ketan Mehta, (iv) Sudhakar Ram, (v) Atul Kanagat and (vi) SteveIsaac, each of such directors to hold office, subject to the applicable provisions of the Surviving Corporation’s Articlesof Incorporation and Bylaws until their respective successors shall have been elected and qualified or until otherwise providedby Law.

 

(b)   Officers.   Fromand after the Effective Time, the Officers of the Surviving Corporation shall consist of  (i) Ketan Mehta (President andChief Executive Officer), (ii) Manish Shah (Executive Vice President), (iii) Chad Hersh (Executive Vice President), (iv) PrateekKumar (Executive Vice President), (v) Lori Stanley (General Counsel and Corporate Secretary) and (vi) Ann Massey (Chief FinancialOfficer), each of such officers to hold their respective office at the discretion of the Board of Directors of the Surviving Corporation.

 

**ArticleII**** **

**EFFECT ON CAPITAL STOCK**

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2.1.   Effect on CapitalStock.   Subject to the terms and conditions set forth in this Agreement, at the Effective Time, by virtue ofthe Merger and without any action on the part of the parties hereto or the holders of any of the following securities, the followingshall occur:

 

(a)   Conversion of CompanyCommon Stock.   All shares of common stock, par value $0.01 per share, of the Company (“Company CommonStock”) issued and outstanding immediately prior to the Effective Time, other than shares to be cancelled pursuant toSection 2.1(b), shall be cancelled and extinguished and automatically converted (subject to Section 2.1(e) hereof)into the right to receive fully paid and non-assessable shares of common stock, par value $0.002 per share, of the Surviving Corporation(the “Surviving Corporation Common Stock”), such that at the Effective Time, the Surviving Corporation CommonStock issued in respect of the issued and outstanding Company Common Stock and Surviving Corporation Common Stock issued or issuablewith respect to issued and outstanding Options, Company RSUs and other equity awards of the Company will in the aggregate represent16.5% of the total capitalization on a fully diluted basis of the Surviving Corporation at Closing, subject to adjustment as setforth in Section 2.1(d) below (such ratio, as adjusted from time to time, the “Exchange Ratio”).

 

(b)   Cancellation ofCompany Common Stock owned by the Company/Subsidiary.   Each share of Company Common Stock that is owned bythe Company or the Subsidiary shall no longer be outstanding and shall automatically be cancelled and retired and shall cease toexist, and no Surviving Corporation Common Stock or other consideration shall be delivered or deliverable in exchange therefor.

 

 

(c)    Stock Options andWarrants.   At the Effective Time, all options to purchase Company Common Stock then outstanding under the CompanyOption Plans and all warrants to purchase Company Common Stock as listed in Section 2.1(c) of the Company Disclosure Letter(the “Company Warrants”) shall be treated as set forth in Sections 5.12 and 5.8(b) hereof, respectively.

 

(d)   Adjustments to ExchangeRatio.   The Exchange Ratio shall be adjusted to reflect appropriately the effect of any forward or reversestock split, stock dividend (including any dividend or distribution of convertible securities), extraordinary cash dividends, reorganization,recapitalization, reclassification, combination, exchange of shares or other like change with respect to Company Common Stock occurringon or after the date hereof and prior to the Effective Time.

 

(e)   Fractional Shares.   Nofraction of a share of Surviving Corporation Common Stock shall be issued by virtue of the Merger, but in lieu thereof, each holderof Company Common Stock who would otherwise be entitled to a fraction of a share of Surviving Corporation Common Stock (after aggregatingall fractional shares of Surviving Corporation Common Stock that otherwise would be received by such holder) shall be automaticallyconverted into the right to receive one full additional share of Surviving Corporation Common Stock.

 

2.2.   Exchange of Certificates.

 

(a)   Exchange Agent.   Promptlyfollowing the Effective Time, the Surviving Corporation shall make available for deposit with a bank or trust company designatedbefore the Closing Date by MM and reasonably acceptable to the Company (the “Exchange Agent”), book-entry shares(or certificates if requested) representing the number of duly authorized whole shares of Surviving Corporation Common Stock issuablein connection with the Merger. The Exchange Agent shall agree to hold such shares of Surviving Corporation Common Stock (such sharesof Surviving Corporation Common Stock being referred to herein as the “Exchange Reserve”) for delivery as contemplatedby this Section 2.2 and upon such additional terms as may be agreed upon by the Exchange Agent and MM or the Surviving Corporation.

 

(b)   Exchange Procedures.

 

(i)   Certificates.   Assoon as reasonably practicable after the Effective Time, and in any event not later than the third (3rd) Business Day after theClosing Date, the Surviving Corporation shall cause the Exchange Agent to mail or deliver electronically through the facilitiesof The Depository Trust Company (“DTC”) to each holder of record of outstanding shares of Company Common Stockwhose shares are converted pursuant to this Agreement (the “Shares”) into the right to receive shares of SurvivingCorporation Common Stock (i) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss andtitle to the Shares shall pass, only upon delivery of the certificates representing such Shares (the “Certificates”)to the Exchange Agent and shall be in such form and have such other provisions as the Surviving Corporation may reasonably specify);and (ii) instructions for use in effecting the surrender of a Certificate in exchange for the Surviving Corporation Common Stock.Upon surrender of a Certificate for cancellation to the Exchange Agent or delivery of Shares through the facilities of DTC, togetherwith such letter of transmittal duly executed and completed in accordance with its terms, the holder of such Shares (includingShares represented by Certificates) shall be entitled to receive in exchange therefor, and the Surviving Corporation shall causethe Exchange Agent to deliver, as promptly as practicable after the Effective Time, that number of whole shares of Surviving CorporationCommon Stock (which shall be in book-entry form unless a certificate is requested), which such holder has the right to receivepursuant to the provisions of Section 2.1, and the Shares and Certificates so surrendered shall forthwith be cancelled.In the event of a transfer of ownership of Company Common Stock which is not registered in the transfer records of the Company,a certificate representing that number of whole shares of Surviving Corporation Common Stock may be issued to a transferee if theCertificate representing such Company Common Stock is presented to the Exchange Agent accompanied by all documents required toevidence and effect such transfer and by evidence that any applicable stock transfer Taxes have been paid. Until surrendered ascontemplated by this Section 2.2, each Certificate shall be deemed at any time after the Effective Time for all corporatepurposes of the Surviving Corporation, except as limited by paragraph (c) below, to represent ownership of the number of sharesof Surviving Corporation Common Stock into which the number of shares of Company Common Stock shown thereon have been convertedas contemplated by this Section 2.2.

 

 

(ii)   Book-Entry Shares.   Notwithstandinganything to the contrary contained in this Agreement, any holder of Shares converted pursuant to this Agreement into the rightto receive shares of Surviving Corporation Common Stock that are held in book-entry form (“Book-Entry Shares”)shall not be required to deliver a Certificate or an executed letter of transmittal to the Exchange Agent to receive the SurvivingCorporation Common Stock that such holder is entitled to receive pursuant to Section 2.1. In lieu thereof, each holder ofrecord of one or more Book-Entry Shares shall automatically upon the Effective Time be entitled to receive, and the Surviving Corporationshall cause the Exchange Agent to deliver as promptly as practicable after the Effective Time, that number of whole shares of SurvivingCorporation Common Stock (which shall be in book-entry form unless a certificate is requested), which such holder has the rightto receive pursuant to the provisions of Section 2.1, and the Book-Entry Shares so surrendered shall forthwith be cancelled.

 

(c)   Distributions withRespect to Un-exchanged Shares.   No dividends or other distributions declared or made after the Effective Timewith respect to Surviving Corporation Common Stock with a record date on or after the Effective Time shall be paid to the holderof any un-surrendered Shares with respect to the shares of Surviving Corporation Common Stock represented thereby until the holderof record of such Shares shall surrender such Shares in accordance with this Section 2.2. Subject to the effect of applicableLaw, following surrender of any such Shares (including Shares represented by Certificates), there shall be paid to the record holderof whole shares of Surviving Corporation Common Stock issued in exchange therefor, without interest, (i) at the time of such surrender,the amount of dividends or other distributions, if any, with a record date on or after the Effective Time which theretofore becamepayable, but which were not paid by reason of the immediately preceding sentence, with respect to such whole shares of SurvivingCorporation Common Stock, and (ii) at the appropriate payment date, the amount of dividends or other distributions with a recorddate on or after the Effective Time but prior to surrender and a payment date subsequent to surrender payable with respect to suchwhole shares of Surviving Corporation Common Stock.

 

(d)   No Further OwnershipRights in Company Common Stock.   All shares of Surviving Corporation Common Stock issued upon the surrenderfor exchange of Shares (including Shares represented by Certificates) in accordance with the terms hereof shall be deemed to havebeen issued at the Effective Time in full satisfaction of all rights pertaining to such Shares. From and after the Effective Time,the stock transfer books of the Company shall be closed and there shall be no further registration of transfers on the stock transferbooks of the Surviving Corporation of the shares of Company Common Stock which were outstanding immediately prior to the EffectiveTime. If, after the Effective Time, Shares (including Shares represented by Certificates) are presented to the Surviving Corporationfor any reason, they shall be cancelled and exchanged as provided in this Section 2.2.

 

(e)   Termination of ExchangeReserve.   Any portion of the Exchange Reserve which remains undistributed to the stockholders of the Companyfor twelve (12) months after the Effective Time shall be delivered to the Surviving Corporation, upon demand, and any stockholdersof the Company who have not theretofore complied with this Section 2.2 shall thereafter look only to the Surviving Corporation(subject to abandoned property, escheat and other similar Laws) as general creditors for payment of their claim for Surviving CorporationCommon Stock and any dividends or distributions with respect to such Surviving Corporation Common Stock. The Surviving Corporationshall be not liable to any holder of shares of Company Common Stock for shares of Surviving Corporation Common Stock (or dividendsor distributions with respect thereto) or cash delivered to a public official pursuant to any applicable abandoned property, escheator similar Law.

 

(f)   Withholding Rights.   TheSurviving Corporation shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreementto any holder of shares of Company Common Stock, including any holder of Options who exercises such options in connection withthe Merger, such amounts as the Surviving Corporation is required to deduct and withhold pursuant to the applicable rules underthe Code, or any provision of state, local or foreign Tax Law. To the extent that amounts are so withheld by the Surviving Corporation,such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the shares of CompanyCommon Stock in respect of which such deduction and withholding was made by the Surviving Corporation.

 

(g)   Lost, Stolen orDestroyed Certificates.   In the event any Certificates shall have been lost, stolen or destroyed, upon themaking of an affidavit of that fact by the Person claiming such Certificate(s)

 

 

to be lost, stolen or destroyed and, if required by the SurvivingCorporation, the posting by such Person of a bond in such sum as the Surviving Corporation may reasonably direct as indemnity againstany claim that may be made against it with respect to such Certificate(s), the Exchange Agent will issue the shares of SurvivingCorporation Common Stock deliverable in respect of the shares of Company Common Stock represented by such lost, stolen or destroyedCertificates.

 

2.3.   Tax Consequences.

 

(a)   It is intended by theparties hereto that the Merger shall constitute a reorganization within the meaning of Section 368 of the Code. The parties heretoadopt this Agreement as a “plan of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of theUnited States Income Tax Regulations. The parties shall not take any position inconsistent with the foregoing intention on anyTax Return or in any administrative or judicial proceeding, unless otherwise required by applicable Law.

 

(b)   Prior to the EffectiveTime, each of the Company and MM shall use their respective commercially reasonable efforts to cause the Merger to qualify as areorganization within the meaning of Section 368(a) of the Code, and shall not take any action reasonably likely to cause the Mergernot so to qualify. The Surviving Corporation shall not take, or cause or permit its Affiliates to take, any action after the EffectiveTime that would cause the Merger not to qualify as a reorganization within the meaning of Section 368(a) of the Code. Followingthe Merger, MM shall continue the Company’s historic business or will use a significant portion of the Company’s historicbusiness assets in a business within the meaning of Section 1.368-1(d) of the United States Income Tax Regulations.

 

**ArticleIII **

**REPRESENTATIONS AND WARRANTIES OF THECOMPANY**

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The Company hereby represents and warrantsto MM, subject to such exceptions as are specifically disclosed in writing (with reference to a specific section of this Agreementto which each such exception applies) in the disclosure letter supplied by the Company to MM, dated as of the date hereof (the “Company Disclosure Letter”) or as otherwise expressly disclosed in the Company SEC Reports filed or furnishedprior to the date hereof, as follows:

 

3.1.   Organization andQualification; Subsidiaries.

 

(a)   Each of the Companyand its wholly-owned subsidiary, Cover-All Systems, Inc., a Delaware corporation (the “Subsidiary”), is a corporationduly organized, validly existing and in good standing under the Laws of the jurisdiction of its incorporation and has the requisitecorporate power and authority to own, lease and operate its assets and properties and to carry on its business as it is now beingconducted. Each of the Company and the Subsidiary is in possession of all franchises, grants, authorizations, licenses, permits,easements, consents, certificates, approvals and orders (“Approvals”) necessary to own, lease and operate theproperties it purports to own, operate or lease and to carry on its business as it is now being conducted, except where the failureto have such Approvals would not, individually or in the aggregate, have or reasonably be expected to have a Company Material AdverseEffect. Each of the Company and the Subsidiary is duly qualified or licensed as a foreign corporation to do business, and is ingood standing, in each jurisdiction where the character of the properties owned, leased or operated by it or the nature of itsactivities makes such qualification or licensing necessary, except for such failures to be so duly qualified or licensed and ingood standing that would not, either individually or in the aggregate, have or reasonably be expected to have a Company MaterialAdverse Effect.

 

(b)   The Company has nosubsidiaries except for the Subsidiary, and owns no debt, equity or other similar interest in any other Person except for the Subsidiary.Neither the Company nor the Subsidiary has agreed, is obligated to make, or is bound by, any written, oral or other agreement,contract, sub-contract, lease, binding understanding, instrument, note, option, warranty, purchase order, license, sub-license,insurance policy, benefit plan, commitment, or undertaking of any nature, under which it may become obligated to make, any futureinvestment in or capital contribution to any other Person. Neither the Company nor the Subsidiary directly or indirectly owns anyequity or similar interest in or any interest convertible, exchangeable or exercisable for any equity or similar interest in, anyother Person.

 

3.2.   Certificate ofIncorporation and Bylaws.   The Company and the Subsidiary have previously furnished to MM complete and correctcopies of their respective Certificates of Incorporation and Bylaws

 

 

as amended to date. Such Certificates of Incorporation and Bylawsare in full force and effect. Neither the Company nor the Subsidiary is in violation of any of the provisions of their respectiveCertificates of Incorporation or Bylaws in any material respect.

 

3.3.   Capitalization.

 

(a)   The authorized capitalstock of the Company consists of 75,000,000 shares of Company Common Stock. As of the close of business on the date hereof, therewere (i) 26,786,693 shares of Company Common Stock issued and outstanding, all of which are validly issued, fully paid and non-assessable,(ii) no shares of Company Common Stock held in treasury by the Company, (iii) 992,500 shares of Company Common Stock reserved forissuance upon the exercise of outstanding options (the “Options”) to purchase Company Common Stock under theAmended and Restated 2005 Stock Incentive Plan (the ”Company Option Plan”), (iv) 53,061 shares of Company CommonStock underlying unvested restricted stock unit awards under the Company Option Plan (the “Company RSU Awards”)and (v) 1,442,000 shares of Company Common Stock reserved for issuance upon the exercise of the Company Warrants. Section3.3(a) of the Company Disclosure Letter sets forth the following information with respect to each Option, Company RSU Awardand Company Warrant outstanding as of the date hereof: (i) the name of the holder thereof; (ii) the number of shares of CompanyCommon Stock subject to such Option, Company RSU Award or Company Warrant; (iii) the exercise price of such Option or Company Warrant;(iv) the date on which such Option, Company RSU Award or Company Warrant was granted; (v) the applicable vesting schedule; (vi)the date on which such Option, Company RSU Award or Company Warrant expires; and (vii) whether the exercisability of such Option,Company RSU Award or Company Warrant will be accelerated in any way by the transactions contemplated hereby, and indicates theextent of any such acceleration. The Company has made available to MM accurate and complete copies of the Company Option Plan,the Company Warrants and all agreements evidencing Options and Company RSU Awards. All shares of Company Common Stock subject tothe issuance aforesaid, upon issuance on the terms and conditions specified in the instrument pursuant to which they are issuable,would be duly authorized, validly issued, fully paid and non-assessable. Except as set forth in Section 3.3(a) of the CompanyDisclosure Letter, there are no commitments or agreements of any character to which the Company is bound obligating the Companyto accelerate the vesting of any Option, Company RSU Award or Company Warrant as a result of the Merger. All outstanding sharesof Company Common Stock, all outstanding Options and Company RSU Awards under the Company Option Plan, all outstanding CompanyWarrants and all outstanding equity securities of the Subsidiary have been issued and granted in compliance in all material respectswith (i) all applicable domestic or foreign statutes, laws, rules, regulations or ordinances (each a “Law”),and any domestic or foreign judgments, decrees, orders, writs, permits or licenses (each an “Order”) or otherwiseput into effect by or under the authority of any Governmental Entity and (ii) all requirements set forth in applicable Contracts.

 

(b)   Except as set forthin Section 3.3(a) hereof, there are no subscriptions, options, warrants, equity securities, equity-linked securities, appreciationrights, phantom equity, partnership interests or similar ownership interests, calls, rights (including preemptive rights), Contracts,commitments or agreements of any character to which the Company or the Subsidiary is a party or by which either is bound obligatingthe Company or the Subsidiary to issue, deliver or sell, or cause to be issued, delivered or sold, or repurchase, redeem or otherwiseacquire, or cause the repurchase, redemption or acquisition of, or deliver cash or other consideration with respect to, any sharesof capital stock, partnership interests or similar ownership interests or equity-linked securities of the Company or the Subsidiaryor obligating the Company or the Subsidiary to grant, extend, accelerate the vesting of or enter into any such subscription, option,warrant, equity security, equity-linked security, appreciation rights, call, right, commitment or agreement. Except as contemplatedby this Agreement, there are no registration rights and there is, except for the Voting Agreement, no voting trust, proxy, rightsplan, antitakeover plan or other agreement or understanding to which the Company or the Subsidiary is a party or by which eitheris bound with respect to, any equity security of any class of the Company or the Subsidiary.

 

3.4.   Authority Relativeto this Agreement.   The Company has all necessary corporate power and authority to execute and deliver thisAgreement and all other Transaction Documents delivered in connection with this Agreement (the “Transaction Documents”)and to perform its obligations hereunder and thereunder and, subject to obtaining the Company Stockholders’ Approval, toconsummate the

 

 

transactions contemplated hereby and thereby. The executionand delivery of this Agreement and the Transaction Documents by the Company and the consummation by the Company of the transactionscontemplated hereby and thereby have been duly and validly authorized by all necessary corporate action on the part of the Companyand no other corporate proceedings on the part of the Company are necessary to authorize this Agreement and the Transaction Documentsor to consummate the transactions so contemplated (other than, with respect to the Merger, the Company Stockholders’ Approval).This Agreement and the Transaction Documents have been duly and validly executed and delivered by the Company and, assuming thedue authorization, execution and delivery by MM, constitute the legal and binding obligation of the Company, enforceable againstthe Company in accordance with their respective terms, subject to (i) the effect of bankruptcy, fraudulent conveyance, reorganization,moratorium and other similar laws relating to or affecting the enforcement of creditor’s rights generally, and (ii) generalequitable principles (whether considered in a proceeding in equity or at law).

 

3.5.   No Conflict; RequiredFilings and Consents.

 

(a)   The execution and deliveryof this Agreement and the Transaction Documents by the Company do not, and, subject to obtaining the Company Stockholders’Approval, the performance of this Agreement and the Transaction Documents by the Company will not, (i) conflict with or violatethe Certificate of Incorporation or Bylaws or equivalent organizational documents of the Company or the Subsidiary, (ii) subjectto obtaining the consents, approvals, authorizations and permits and making the registrations, filings and notifications set forthin Section 3.5(b) hereof  (or Section 3.5(b) of the Company Disclosure Letter), conflict with or violate anyLaw applicable to the Company or the Subsidiary or by which either or any of their respective properties is bound or affected,(iii) except as set forth on Section 3.5(a)(iii) of the Company Disclosure Letter, result in any breach of or constitutea default (or an event that with notice or lapse of time or both would become a default) under, or impair the Company’s orthe Subsidiary’s rights or alter the rights or obligations of any third party under, or give to others any rights of termination,amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of the Companyor the Subsidiary pursuant to, any material Contract to which the Company or the Subsidiary is a party or by which the Companyor the Subsidiary or any of their respective properties are bound or affected, or (iv) other than as set forth in Section 3.3(a)of the Company Disclosure Letter, cause the acceleration of any vesting of any awards for or rights to Company Common Stock orthe payment of or the acceleration of payment of any change in control, severance, bonus or other cash payments or issuance ofCompany Common Stock, except in the case of clauses (ii) and (iii), to the extent such conflict, violation, breach, default, impairmentor other effect would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

 

(b)   The execution and deliveryof this Agreement and the Transaction Documents by the Company does not, and the performance of this Agreement and the TransactionDocuments by the Company will not, require any consent, approval, authorization or permit of, or registration, filing with or notificationto, any court, administrative agency, commission, governmental or regulatory authority, domestic or foreign (each, a “GovernmentalEntity” and, collectively, “Governmental Entities”), except for (i) applicable requirements, if any,of the Securities Act of 1933, as amended (the “Securities Act”), the Securities Exchange Act of 1934, as amended(the “Exchange Act”), and U.S. state securities laws (“Blue Sky Laws”), (ii) the filing andrecordation of the Certificates of Merger as required by the CGCL and the DGCL, as applicable, and (iii) such consents, approvals,authorizations, permits, registrations, filings or notifications which, if not obtained or made, would not have a Company MaterialAdverse Effect.

 

3.6.   SEC Filings; InternalControls; Procedures.

 

(a)   The Company has madeavailable to MM a correct and complete copy of each report, schedule, registration statement and definitive proxy statement orother documents filed by the Company with the SEC on or after January 1, 2011 (the “Company SEC Reports”),which are all the forms, reports and documents required to be filed by the Company with the SEC since such date. The Company SECReports (x) complied as to form in all material respects with the requirements of the Securities Act or the Exchange Act, as thecase may be, and (y) did not contain any untrue statement of a material fact or omit to state a material fact required to be statedtherein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.Neither the Company nor the

 

 

Subsidiary is required to file any reports or other documentswith the SEC since January 1, 2011. The audited consolidated financial statements and unaudited interim consolidated financialstatements (including, in each case, the notes, if any, thereto) included in the Company SEC Reports (the “Company FinancialStatements”) (i) complied as to form in all material respects with the published rules and regulations of the SEC withrespect thereto, (ii) were prepared in accordance with generally accepted accounting principles of the United States (“GAAP”),applied on a consistent basis during the periods involved (except as may be indicated therein in the notes thereto), (iii) fairlypresent (subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments (which are notexpected to be, individually or in the aggregate, materially adverse to the Company and the Subsidiary taken as a whole) and theabsence of complete footnotes) in all material respects the consolidated financial position of the Company and the Subsidiary asat the respective dates thereof and the consolidated results of their operations and cash flows for the respective periods thenended and (iv) were compiled from, and are consistent with, the books and records of the Company, which books and records are accurateand complete in all material respects. The Subsidiary is treated as a consolidated subsidiary of the Company in the Company FinancialStatements for all periods covered thereby.

 

(b)   The Company and theSubsidiary have established and maintain a system of  “internal controls over financial reporting” (as definedin Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that is sufficient to provide reasonable assurance (i) regarding the reliabilityof financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, (ii) that receiptsand expenditures of the Company and the Subsidiary are being made only in accordance with authorizations of management and theCompany Board, and (iii) regarding prevention or timely detection of the unauthorized acquisition, use or disposition of the Company’sand the Subsidiary’s assets that could have a material effect on the Company’s financial statements.

 

(c)   The Company’s“disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) are designedto ensure that all information (both financial and non-financial) required to be disclosed by the Company in the reports that itfiles or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in therules and forms of the SEC, and that all such information is accumulated and communicated to the Company’s management asappropriate to allow timely decisions regarding required disclosure and to make the certifications of the chief executive officerand chief financial officer of the Company required under the Exchange Act with respect to such reports. The Company has disclosed,based on its most recent evaluation of such disclosure controls and procedures, to the Company’s auditors and the audit committeeof the Company Board and in Section 3.6(c) of the Company Disclosure Letter (i) any significant deficiencies and materialweaknesses in the design or operation of internal controls over financial reporting that could adversely affect in any materialrespect the Company’s ability to record, process, summarize and report financial information, and (ii) any fraud, whetheror not material, that involves management or other employees who have a significant role in the Company’s internal controlsover financial reporting. For purposes of this Agreement, the terms “significant deficiency” and “material weakness”shall have the meaning assigned to them in Public Company Accounting Oversight Board Auditing Standard 2, as in effect on the datehereof.

 

(d)   Neither the Companynor the Subsidiary is a party to, or has any commitment to become a party to, any joint venture, off balance sheet partnershipor any similar Contract (including any Contract or arrangement relating to any transaction or relationship between or among theCompany and the Subsidiary, on the one hand, and any unconsolidated Affiliate, including any structured finance, special purposeor limited purpose entity or Person, on the other hand, or any “off balance sheet arrangements” (as defined in Item303(a) of Regulation S-K under the Exchange Act)), where the result, purpose or intended effect of such Contract is to avoid disclosureof any material transaction involving, or material Liabilities of, the Company or the Subsidiary in the Company’s or theSubsidiary’s published financial statements or other Company SEC Reports.

 

(e)   Each of the principalexecutive officer and the principal financial officer of the Company (or each former principal executive officer and each formerprincipal financial officer of the Company, as applicable) has made all certifications required by Rule 13a-14 or 15d-14 underthe Exchange Act and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (including the rules and regulations promulgated

 

 

thereunder, the “Sarbanes-Oxley Act”) withrespect to the Company SEC Reports, and the statements contained in such certifications are true and accurate in all material respects.For purposes of this Agreement, “principal executive officer” and “principal financial officer” shall havethe meanings given to such terms in the Sarbanes-Oxley Act. Neither the Company nor the Subsidiary has outstanding (nor has arrangedor modified since the enactment of the Sarbanes-Oxley Act) any “extensions of credit” (within the meaning of Section402 of the Sarbanes-Oxley Act) to directors or executive officers (as defined in Rule 3b-7 under the Exchange Act) of theCompany or the Subsidiary. The Company is otherwise in compliance with all applicable provisions of the Sarbanes-Oxley Act andthe applicable listing and corporate governance rules of the NYSE MKT, except for any non-compliance that would not have, or reasonablybe expected to have, individually or in the aggregate, a Company Material Adverse Effect.

 

3.7.   Compliance; Permits.

 

(a)   Neither the Companynor the Subsidiary is in conflict with, or in default or violation of: (i) any Law or Order applicable to the Company or theSubsidiary, or by which any of their respective properties is bound or affected, or (ii) any Contract to which the Company or theSubsidiary is a party or by which the Company or the Subsidiary or any of their respective properties is bound or affected, exceptfor any conflicts, defaults or violations of such Laws, Orders or Contracts that (individually or in the aggregate) would not haveor reasonably be expected to have a Company Material Adverse Effect. No Governmental Entity has indicated in writing to the Companyor the Subsidiary an intention to conduct an investigation or review against the Company or the Subsidiary, and, to the Knowledgeof the Company, no investigation or review by any Governmental Entity is pending or threatened against the Company or the Subsidiary,other than, in each such case, those the outcome of which would not, individually or in the aggregate, have or reasonably be expectedto have a Company Material Adverse Effect.

 

(b)   The Company and theSubsidiary hold all permits, licenses, variances, exemptions, orders and approvals from Governmental Entities which are materialto operation of the business of the Company and the Subsidiary as currently conducted (collectively, the “Company Permits”).To the Knowledge of the Company, the Company and the Subsidiary are in compliance in all material respects with the terms of theCompany Permits.

 

3.8.   No UndisclosedLiabilities.   Except for matters reflected or reserved against in the balance sheet as of September 30,2014 included in the Company Financial Statements or as disclosed in any Company SEC Report filed or furnished after such date,neither the Company nor the Subsidiary had at such date, or has incurred since that date, any Liabilities or obligations (whetherabsolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature that would be required by GAAPto be reflected on a consolidated balance sheet of the Company and its consolidated subsidiaries (including the notes thereto),except Liabilities or obligations which were incurred in the ordinary course of business consistent with past practice (none ofwhich is a Liability for breach of contract, breach of warranty, tort, infringement or a Legal Action for environmental Liability),or Liabilities which would not be reasonably expected to have, individually or in the aggregate, a Company Material Adverse Effect.

 

3.9.   Absence of CertainChanges or Events.   Since December 31, 2013, except as described in the Company Disclosure Letter or inthe Company SEC Reports, neither the Company nor the Subsidiary has:

 

(i)    sold or transferredany portion of their respective assets or property that would be material to the Company or the Subsidiary, except for sales inthe ordinary course of business consistent with past practice;

 

(ii)   suffered any materialloss, or any material interruption in use, of any material assets or property on account of fire, flood, riot, strike or otherhazard or Act of God that is not covered by insurance;

 

(iii)  suffered any changeto their respective businesses which has had, or would reasonably be expected to have, a Company Material Adverse Effect;

 

(iv)  entered into anyContract that would constitute a Company Material Agreement;

 

(v)   terminated or materiallymodified, waived any material right under or cancelled any Company Material Agreement or waived any material right with respectto any of the items disclosed in Section 3.18 of the Company Disclosure Letter;

 

 

(vi)     incurred any Lienson any material assets or property, or any losses, damages, deficiencies, liabilities or obligations (whether absolute, accrued,contingent, disclosed or otherwise) that are required by GAAP to be provided or reserved against on a balance sheet (the “Liabilities”),except for Liabilities incurred in the ordinary course of business consistent with past practice which are not material to theirrespective business;

 

(vii)    granted any registrationrights with respect to any of their respective equity securities;

 

(viii)   paid or declaredany dividends or other distributions on their respective equity securities of any class or issued, purchased or redeemed any oftheir respective equity securities of any class;

 

(ix)     transferred, assignedor granted any license or sublicense of any material rights under, or with respect to, items disclosed in Section 3.18 ofthe Company Disclosure Letter;

 

(x)      made any materialcapital expenditures;

 

(xi)     split, combined orreclassified any shares of their respective equity securities;

 

(xii)    made any capitalinvestment in, or any loan to, any other Person;

 

(xiii)   amended any oftheir respective organizational or constituent documents;

 

(xiv)   paid or materiallyincreased any bonuses, salaries, or other compensation to any director, officer, or employee except pursuant to a Company Planor in the ordinary course of business consistent with past practice;

 

(xv)    adopted, modifiedor increased payments or benefits under any Company Plan;

 

(xvi)   entered into, terminated,or received notice of termination of any (a) license, distributorship, dealer, sales representative, joint venture, credit or similaragreement, or (b) Contract or transaction involving a total remaining commitment of at least $250,000;

 

(xvii)  materially changedany accounting method, assumption or period, made, changed or revoked any Tax election, filed a Tax Return in a jurisdiction inwhich a Tax Return was not previously filed, failed to file any Tax Return (taking into account extensions of time to file) consentedto any extension or waiver of the limitations period applicable to any Tax claim or assessment, entered into a closing agreement,or settled any administrative or judicial proceeding related to Taxes;

 

(xviii) materially changedcash management practices with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts,accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of otherexpenses, deferral of revenue and acceptance of customer deposits;

 

(xix)    instituted, settledor compromised any Legal Actions pending or threatened before any arbitrator, court or other Governmental Entity involving thepayment of monetary damages of any amount exceeding $250,000 in the aggregate; or

 

(xx)     agreed or committed,whether orally or in writing, to do any of the foregoing.

 

3.10.   Absence of Litigation.   Tothe Knowledge of the Company, there are no Legal Actions pending or threatened against the Company or the Subsidiary, or any propertiesor rights of the Company or the Subsidiary, before any Governmental Entity, including, for the avoidance of doubt, the SEC.

 

3.11.   Employee BenefitPlans.

 

(a)   Each “employeebenefit plan,” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”)and all other pension, retirement, supplemental retirement, deferred compensation, excess benefit, profit sharing, bonus, incentive,stock purchase, stock ownership, stock option, stock appreciation right, profits interest, employment, severance, salary continuation,termination, change-of-control, health, life, disability, group insurance, vacation, holiday and fringe benefit plan, program,contract, or arrangement (whether written or unwritten, qualified or nonqualified, funded or unfunded and including any that havebeen frozen or terminated) maintained, contributed to, or required

 

 

to be contributed to, by (i) the Company, (ii) the Subsidiary,or (iii) any trade or business (whether or not incorporated) which is a member of a controlled group or which is under common controlwith the Company within the meaning of Sections 414(b) or (c) of the Code (an “ERISA Affiliate”), under whichthe Company or any ERISA Affiliate has any Liability with respect to any current or former employee, director, officer or independentcontractor of the Company or of the Subsidiary (the “Company Plans”), are listed in Section 3.11(a) ofthe Company Disclosure Letter. The Company has made available to MM, as applicable: (i) correct and complete copies of all documentsembodying each Company Plan including (without limitation) all amendments thereto, all related trust documents, and all materialwritten agreements and contracts relating to each such Company Plan; (ii) the three (3) most recent annual reports (Form Series5500 and all schedules and financial statements attached thereto), if any, required under ERISA or the Code in connection witheach Company Plan; (iii) the most recent summary plan description together with the summary(ies) of material modifications thereto,if any, required under ERISA with respect to each Company Plan; (iv) all IRS determination, opinion, notification and advisoryletters; (v) to the extent available, all material correspondence to or from any Governmental Entity relating to any Company Plan;(vi) to the extent available, all COBRA forms and related notices within the last three (3) years; (vii) to the extent available,all discrimination tests for the Company Plan for the most recent three (3) plan years; (viii) the most recent annual actuarialvaluations, if any, prepared for each Company Plan; (xi) the most recent annual and periodic accounting of the Company Plan assets;(x) all material written agreements and contracts relating to each Company Plan, including, but not limited to, administrativeservice agreements, group annuity contracts and group insurance contracts; (xi) all material communications generally distributedto all employees or former employees within the last three (3) years relating to any amendments, terminations, establishments,increases or decreases in benefits, acceleration of payments or vesting schedules or other events which would result in any materialLiability under any Company Plan or proposed Company Plan; (xii) all policies pertaining to fiduciary liability insurance coveringthe fiduciaries for each Company Plan; and (xiii) all registration statements, annual reports and prospectuses prepared in connectionwith any Company Plan.

 

(b)   The Company and eachERISA Affiliate are in compliance in all material respects with the provisions of ERISA, the Code and all statutes, orders, rulesand regulations (foreign or domestic) applicable to the Company Plans. Each Company Plan is and has been maintained, operated andadministered in compliance in all material respects with its terms and any related documents or agreements and the applicable provisionsof ERISA, the Code and all statutes, orders, rules and regulations (foreign or domestic) which are applicable to such Company Plans.

 

(c)   No Legal Actions (excludingindividual claims for benefits incurred in the normal operation of the Company Plan) have been brought, or to the Knowledge ofthe Company is threatened, against or with respect to any such Company Plan. Neither the Company nor the Subsidiary has receivedany correspondence from the IRS or the DOL regarding, and, to the Knowledge of the Company, there are no audits, enquiries or proceedingspending or, threatened by the IRS or the DOL with respect to any Company Plans. All contributions, reserves or premium paymentsrequired to be made or accrued as of the date hereof and as of the Closing Date to Company Plans have or will have been timelymade or accrued.

 

(d)   Any Company Plan intendedto be qualified under Section 401(a) of the Code and each trust intended to qualify under Section 501(a) of the Code has obtained(or has an outstanding application for) a favorable determination, notification, advisory and/or an opinion letter, as applicable,as to its qualified status from the IRS, and, to the Knowledge of the Company, nothing has occurred with regard to each such pensionplan and the related trusts that could jeopardize such qualified status and exemption from taxation under Section 501(a) of theCode. The Company does not have any plan or commitment to establish any new Company Plan, to materially modify any Company Plan(except to the extent required by Law or to conform any such Company Plan to the requirements of any applicable Law, in each caseas previously disclosed to MM in writing, or as required by this Agreement), or to enter into any new Company Plan.

 

(e)   No Company Plan isnow or at any time has been subject to Part 3, Subtitle B of Title I of ERISA or Title IV of ERISA. Neither the Company nor anyERISA Affiliate has ever contributed to, or been required to contribute to any “multiemployer plan” (within the meaningof Section 3(37) of ERISA) and neither the Company nor any ERISA Affiliate has any Liability (contingent or otherwise) relatingto

 

 

the withdrawal or partial withdrawal from a multiemployer plan.Neither the Company nor the Subsidiary is subject to any Liability or penalty under Section 4975 through 4980B of the Code or TitleI of ERISA (other than routine claims for benefits under any Company Plan). No “prohibited transaction,” within themeaning of Section 4975 of the Code or Sections 406 and 407 of ERISA, and not otherwise exempt under Section 408 of ERISA, hasoccurred with respect to any Company Plan that would reasonably be expected to impose a material Liability on the Company or theSubsidiary.

 

(f)   The Company, the Subsidiaryand each ERISA Affiliate have complied in all material respects with the notice and continuation coverage requirements of Section4980B of the Code and the regulations thereunder (“COBRA”). None of the Company Plans promises or provides retireemedical or other retiree welfare benefits to any Person except as required by applicable Law, and neither the Company nor the Subsidiaryhas represented, promised or contracted (whether in oral or written form) to provide such retiree benefits to any employee, formeremployee, director, consultant or other Person, except to the extent required by Law.

 

(g)   Neither the executionand delivery of this Agreement or the Transaction Documents nor the consummation of the transactions contemplated hereby and thereby,solely by themselves, will (i) result in any material payment (including severance, unemployment compensation, golden parachute,bonus or otherwise) becoming due to any stockholder, director or employee of the Company or the Subsidiary under any Company Planor otherwise, (ii) materially increase any benefits otherwise payable under any Company Plan, (iii) limit the right to merge, amendor terminate any Company Plan, or (iv) result in the acceleration of the time of payment or vesting of any such benefits.

 

(h)   No payment or benefitthat will or may be made by the Company or its ERISA Affiliates with respect to any employee, former employee, director, officeror independent contractor of the Company or the Subsidiary, either alone or in conjunction with any other payment, event or occurrence,(X) will or could reasonably be characterized as an “excess parachute payment” under Section 280G of the Code or (Y)will not be fully deductible as a result of Section 162(m) of the Code. There is no Contract to which the Company or the Subsidiaryis a party or by which it is bound to compensate any individual for excise taxes paid pursuant to Section 4999 of the Code.

 

(i)    Section 3.11(i)of the Company Disclosure Letter sets forth the name, title and current annual salary of all present officers and employees ofthe Company and the Subsidiary whose rate of annual compensation equals or exceeds $100,000 together with a statement of the fullamount of all remuneration paid by the Company or the Subsidiary to each such person, during the twelve (12)-month period endingDecember 31, 2013 and the nine month period ended September 30, 2014.

 

(j)    Except as would notreasonably be expected to result in a material liability to the Company, each Company Plan that constitutes a “non-qualifieddeferred compensation plan” within the meaning of Section 409A of the Code, complies in both form and operation with therequirements of Section 409A of the Code so that no amounts paid pursuant to any such Company Plan is subject to tax under Section409A of the Code.

 

(k)   Neither the Companynor the Subsidiary has or is required to have an International Employee Plan.

 

(l)    The Company and eachERISA Affiliate has, for purposes of each Company Plan, correctly classified all individuals performing services for the Companyas common law employees, leased employees, independent contractors or agents, as applicable.

 

3.12.   Labor Matters.

 

(a)   (i) Neither the Companynor the Subsidiary is a party to any collective bargaining agreement or other labor union contract applicable to Persons employedby the Company or the Subsidiary nor does the Company or the Subsidiary know of any activities or proceedings of any labor unionto organize any such employees; and (ii) neither the Company nor the Subsidiary have any Knowledge of any strikes, slowdowns, workstoppages or lockouts, or threats thereof, by or with respect to any employees of the Company or the Subsidiary.

 

 

(b)   During the past three(3) years, (i) each of the Company and the Subsidiary is and has been in material compliance with all applicable Laws with respectto labor and employment, including, without limitation, Laws with respect to fair employment practices, discrimination, immigrationand naturalization, retaliation, work place safety and health, unemployment compensation, workers’ compensation, affirmativeaction, terms and conditions of employment and wages and hours, (ii) except as disclosed in Section 3.12(b) of the CompanyDisclosure Letter, to the Knowledge of the Company, there have been no Legal Actions pending before any Governmental Entity, orthreats thereof with respect to labor and employment matters, including Legal Actions between the Company or the Subsidiary (onthe one hand) and any of the current or former employees or current or former workers of the Company or the Subsidiary (on theother hand), (iii) there have been no written notices of charges of discrimination in employment or employment practices for anyreason or noncompliance with any other Law with respect to labor or employment that have been asserted, or, to the Knowledge ofthe Company, threats thereof, before the United States Equal Employment Opportunity Commission or any other Governmental Entity,(iv) neither the Company nor the Subsidiary has been a party to, or otherwise bound by, any consent decree or settlement agreementwith, or citation by, any Governmental Entity relating to their current or former employees or employment practices, and (v) tothe Knowledge of the Company, neither the Company nor the Subsidiary has been subject to any audit or investigation by the OccupationalSafety and Health Administration, the DOL, or other Governmental Entity with respect to labor or employment Laws or with respectto the employees of the Company or the Subsidiary, or subject to fines, penalties, or assessments associated with such audits orinvestigations.

 

(c)   To the Knowledge ofthe Company, all of the employees of the Company and the Subsidiary are (i) United States citizens or lawful permanent residentsof the United States, (ii) aliens whose right to work in the United States is unrestricted, or (iii) aliens who have valid, unexpiredwork authorizations issued by the United States government.

 

(d)   Neither the Companynor the Subsidiary has experienced a “plant closing,” “business closing,” or “mass layoff”as defined in the WARN Act or any similar state, local or foreign law or regulation affecting any site of employment of the Companyor the Subsidiary or one or more facilities or operating units within any site of employment or facility of the Company or theSubsidiary, and, during the ninety (90) day period preceding the date hereof, no Person has suffered an “employment loss”(as defined in the WARN Act) with respect to the Company or the Subsidiary. Except as disclosed in Section 3.12(d) of theCompany Disclosure Letter, in the past twelve (12) months no officer’s or key employee’s employment with the Companyor the Subsidiary has been terminated for any reason, and, to the Knowledge of the Company, no officer or key employee has expressedany plans to terminate his, her or their employment or service arrangement with the Company or the Subsidiary.

 

(e)   To the Knowledge ofthe Company, the Company and the Subsidiary have properly treated all individuals performing rendered services to either the Companyor the Subsidiary as employees, leased employees, independent contractors or agents, as applicable, for all federal, state localand foreign Tax purposes. There has been no determination by any Governmental Entity that any independent contractor is an employeeof the Company or the Subsidiary.

 

3.13.   RegistrationStatement; Proxy Statement.   None of the information supplied or to be supplied by the Company for inclusionor incorporation by reference in (i) the Proxy Statement and the Registration Statement will contain any untrue statement of amaterial fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein,in light of the circumstances under which they are made, not misleading, and (ii) the Proxy Statement and the Registration Statementwill, on the dates mailed to the stockholders of the Company, at the time of the Company Stockholders’ Meeting and as ofthe Effective Time, contain any untrue statement of a material fact or omit to state any material fact required to be stated thereinor necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading.The Registration Statement and the Proxy Statement will comply as to form in all material respects with the provisions of the ExchangeAct and the Securities Act and the rules and regulations promulgated by the SEC thereunder.

 

3.14.   Restrictionson Business Activities.   There is no agreement, commitment, judgment, injunction, order or decree binding uponthe Company or the Subsidiary or to which the Company or the Subsidiary is a party which has or would reasonably be expected tohave the effect, in any material respect,

 

 

of prohibiting or impairing any present business practice ofthe Company or the Subsidiary, any acquisition of property by the Company or the Subsidiary or the conduct of business by the Companyor the Subsidiary as currently conducted.

 

3.15.   Title to Property.

 

(a)   Neither the Companynor the Subsidiary own any real property. Section 3.15 of the Company Disclosure Letter identifies by street address allreal property leased or subleased by the Company and the Subsidiary (the “Company Leased Real Estate”). AllCompany Leased Real Estate is leased to the Company and/or the Subsidiaries pursuant to written leases, complete and accurate copiesof which have been previously delivered to MM (collectively the “Company Leases”). Each of the Company and/orthe Subsidiary has a valid leasehold interest in the Company Leased Real Estate, free and clear of all Liens. Neither the Companynor the Subsidiary has subleased any Company Leased Real Estate. The Company Leased Real Estate is not subject to any third-partylicenses, concessions, leases or tenancies of any kind, except as indicated on the Company Disclosure Letter. The Company Leasesare in full force and effect. There are no defaults in any material respect on the part of any landlord or the Company and theSubsidiary under the Company Leases. The Company and the Subsidiary have performed in all material respects all of the obligationson their part to be performed under the Company Leases. No written consent of any landlord under the Company Leases is requiredor necessary in order to consummate the transactions contemplated by this Agreement and the Transaction Documents except as otherwiseprovided on Section 3.15 of the Company Disclosure Letter.

 

(b)   Neither the Companynor the Subsidiary has received written notice that the use or occupancy of the Company Leased Real Estate violates in any materialrespect any covenants, conditions or restrictions that encumber such property, or that any such property is subject to any restrictionfor which any material permits necessary to the current use thereof have not been obtained.

 

(c)   To the Knowledge ofthe Company, there are no pending or threatened condemnation proceedings with respect to any material portion of the Company LeasedReal Estate.

 

3.16.   Taxes.

 

(a)   Definition of Taxes.   Forall purposes of and under this Agreement, “Tax” or “Taxes” refers to any and all federal,state, local and foreign taxes, assessments and other governmental charges, duties, impositions and other Liabilities relatingto taxes, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added,ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise and property taxes, together with all interest,penalties and additions imposed with respect to such amounts and any obligations under any agreements or arrangements with anyother Person with respect to such amounts and including any Liability for the foregoing of a predecessor entity.

 

(b)   Tax Returns andAudits.

 

(i)   The Company and theSubsidiary have timely filed all federal, state, local and foreign returns, estimates, information statements and reports (“TaxReturns”) relating to Taxes required to be filed by the Company and the Subsidiary, in all the jurisdictions in which(x) they are qualified to do business and (y) they operate, except with respect to clause (y) as would not be reasonably expectedto result in a Company Material Adverse Effect. Such Tax Returns are true and correct in all material respects, have been completedin accordance with applicable Law, and all Taxes shown to be due on such Tax Returns have been paid. The Company has deliveredto MM correct and complete copies of all Tax Returns, examination reports, and statements of deficiencies assessed against or agreedto by the Company or the Subsidiary filed or received since December 31, 2010. There are no liens for Taxes (other than Taxesnot yet due and payable) upon any assets of the Company or the Subsidiary.

 

(ii)  The Company and theSubsidiary as of the Effective Time will have withheld with respect to its employees all federal and state income Taxes, Taxespursuant to the Federal Insurance Contribution Act, Taxes pursuant to the Federal Unemployment Tax Act and other Taxes requiredto be withheld.

 

 

(iii)   Neither the Companynor the Subsidiary has been delinquent in the payment of any Tax nor is there any Tax deficiency outstanding, proposed or assessedagainst the Company or the Subsidiary, nor has the Company or the Subsidiary executed any unexpired waiver of any statute of limitationson or extending the period for the assessment or collection of any Tax.

 

(iv)   To the Knowledgeof the Company, no audit or other examination of any Tax Return of the Company or the Subsidiary by any tax authority is presentlyin progress. Neither the Company nor the Subsidiary has been notified in writing of any such audit or other examination. The Companyand the Subsidiary have paid in full any demands raised by any tax authority as a result of any audit that has been previouslyconducted.

 

(v)    No adjustment relatingto any Tax Returns filed by the Company or the Subsidiary has been proposed in writing formally or informally by any tax authorityto the Company or the Subsidiary or any Representative thereof.

 

(vi)   Neither the Companynor the Subsidiary has any Liability for any unpaid Taxes, whether or not such Taxes have been accrued for or reserved on the CompanyFinancial Statements in accordance with GAAP or whether or not asserted or unasserted, contingent or otherwise, except for Taxesnot yet due and payable or which are being contested in good faith.

 

(c)   Tax Agreements.   Neitherthe Company nor the Subsidiary is party to or has any obligation under any Tax-sharing, Tax indemnity or Tax allocation agreementor arrangement other than agreements between the Company and the Subsidiary.

 

(d)   Continuity of Interest.   Priorto the Merger, the Company’s stockholders did not dispose of any Company Common Stock to the Company or to Persons relatedto the Company or receive any distribution from the Company in a manner that would cause the Merger to violate the continuity ofshareholder interest requirement set forth in Section 1.368-1(e) of the United States Income Tax Regulations.

 

(e)   No Other Actions.   Neitherthe Company nor any of its affiliates has taken or agreed to take any action, or is aware of any fact or circumstance, that couldreasonably be expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.

 

3.17.   EnvironmentalMatters.

 

(a)   To the Knowledge ofthe Company, the Company and the Subsidiary are in compliance, in all material respects, with all applicable Environmental Lawsand Environmental Permits.

 

(b)   The Company and theSubsidiary possess all material Environmental Permits which are required for the operation of their respective businesses.

 

(c)   To the Knowledge ofthe Company, there is no Environmental Claim pending or overtly threatened against the Company or the Subsidiary.

 

(d)   To the Knowledge ofthe Company, neither the Company nor the Subsidiary has treated, stored, disposed of, arranged for or permitted the disposal of,transported, handled, released or exposed any Person to any Hazardous Substances or owned or operated any property or facility(and no such property or facility is contaminated by any Hazardous Substance), so as to give rise to any Environmental Claim.

 

(e)   Without limiting thegenerality of the foregoing, to the Knowledge of the Company, neither the Company nor the Subsidiary has any outstanding legalor contractual obligation under any applicable Environmental Law, or any unresolved enforcement action or Liability pursuant toany Environmental Law, including but not limited to, any outstanding investigation, cleanup, removal, response activity, remediation,or corrective action obligation under any applicable Environmental Law or any outstanding indemnification obligation owed to anythird party under any applicable Environmental Law relating to the Company Leased Real Estate, any formerly owned or operated property,or any offsite disposal location.

 

(f)   To the Knowledge ofthe Company, neither this Agreement or the Transaction Documents nor the consummation of the transactions contemplated hereby andthereby will result in any obligations for site investigation or cleanup, or notification to or consent of any governmental entityor third parties, pursuant to any of the so-called “transaction-triggered” or “responsible property transfer”Environmental Laws.

 

 

(g)   The Company and theSubsidiary have made available to MM copies of all material Environmental Permits, studies, reports and audits or correspondenceto or from any government authority pertaining to the Company Leased Real Estate that are within the Company’s and the Subsidiary’spossession or control.

 

3.18.   IntellectualProperty.

 

(a)   Section 3.18(a)(i)of the Company Disclosure Letter contains an accurate and complete list of all Company Registered Intellectual Property Rights,specifying as to each such Registered Intellectual Property Right, as applicable, (i) the jurisdictions by or in which such RegisteredIntellectual Property Right has been issued or registered or in which an application for such issuance or registration has beenfiled and (ii) the registration or application numbers thereof. Section 3.18(a)(ii) of the Company Disclosure Letter containsan accurate and complete list of all Company Intellectual Property Rights that are material to the business of the Company andthe Subsidiary. Section 3.18(a)(iii) of the Company Disclosure Letter contains an accurate and complete list of all materialComputer Software that is owned, licensed, leased or otherwise used in the business of the Company or the Subsidiary, excluding(x) commercially available “off the shelf” software, and (y) Computer Software that the Company or the Subsidiary receivesas “free software”, “open source software” or under a similar licensing or distribution model). Section3.18(a)(iii) of the Company Disclosure Letter identifies which Computer Software is owned, licensed, leased or otherwise usedin the business of the Company or the Subsidiary, as the case may be. Section 3.18(a)(iv) of the Company Disclosure Letterlists all Computer Software and service offerings that the Company or the Subsidiary have licensed, sold, distributed or providedto third parties in the five (5) years prior to the date hereof, or that the Company or the Subsidiary is obligated to providemaintenance or support thereunder (collectively, “Company Products”). Neither the Company nor the Subsidiaryown any patents or patent applications.

 

(b)   Section 3.18(b)(i)of the Company Disclosure Letter lists any License Agreements and Contracts under which the Company or the Subsidiary has grantedany third party rights that are exclusive, or exclusive of all other third parties, to use, sublicense, resell or distribute anyCompany Intellectual Property Right. Section 3.18(b)(ii) of the Company Disclosure Letter lists any License Agreements andContracts under which (x) the Company or the Subsidiary has deposited or is obligated to deposit source code or other proprietarymaterials in escrow for the benefit of a third party, or (y) a third party is or under any circumstances may be entitled to receivesource code directly from the Company or the Subsidiary or from escrow.

 

(c)   Neither the Companynor the Subsidiary is a party to any License Agreements, forbearances to sue, consents, judgments, orders or similar obligationsthat restrict the rights of the Company or the Subsidiary to use or enforce any Company Intellectual Property Rights.

 

(d)   The Company or theSubsidiary, as applicable, own all right, title, and interest, free and clear of all security interests and similar encumbrances,in and to all Company Intellectual Property Rights. Except as listed on Section 3.18(d) of the Company Disclosure Letter,the Company or the Subsidiary, as applicable, is listed in the records of the appropriate United States, state or foreign agencyas the sole owner for each Company Registered Intellectual Property Right.

 

(e)   To the Knowledge ofthe Company, the Company’s and the Subsidiary’s Licensed Intellectual Property Rights and the Company IntellectualProperty Rights together constitute all the Intellectual Property Rights necessary to conduct the business of the Company and theSubsidiary as currently conducted. To the Company’s Knowledge, the conduct of the business of the Company and the Subsidiaryas such business is currently conducted, including the design, development, marketing and sale of the Company Products and services:(i) does not infringe, misappropriate or otherwise violate the Intellectual Property Rights of any third party; and (ii) does notconstitute unfair competition or unfair trade practices under the Laws in the United States.

 

(f)   Neither the Companynor the Subsidiary has received any written, or, to the Knowledge of the Company, oral communications from any third party claimingthat the operation of the business of the Company or the Subsidiary, or any act of the Company or the Subsidiary, or any CompanyProduct or service, or the use of any Company Product or service, infringes, misappropriates or otherwise violates the

 

 

Intellectual Property Rights of any third party or constitute unfaircompetition or unfair trade practices under the Laws of any jurisdiction. Neither the Company nor the Subsidiary has received anywritten communication from a third party pursuant to which the third party offered the Company or the Subsidiary a license to useany technology or Intellectual Property Rights in order to avoid a claim of infringement or misappropriation.

 

(g)   Neither the Company northe Subsidiary has received written notice of, and to the Knowledge of the Company, there is no pending or threatened Legal Actionby a third party before any Governmental Entity in any jurisdiction challenging the ownership, use, validity, enforceability orregistrability of any Company Intellectual Property Rights. To the Knowledge of the Company, there is no pending or threatenedLegal Action relating to the business of the Company or the Subsidiary before any Governmental Entity in any jurisdiction: challengingthe ownership, use, validity, enforceability, or registrability of any of the Company’s or the Subsidiary’s LicensedIntellectual Property Rights or the rights of the Company or the Subsidiary to use or exploit any of the Company’s or theSubsidiary’s Licensed Intellectual Property Rights, in each case, other than as would not be reasonably expected to resultin a Company Material Adverse Effect.

 

(h)   To the Knowledge of theCompany, no Person has infringed, misappropriated, or otherwise violated, or is infringing, misappropriating, or otherwise violating,any Company Intellectual Property Rights. Neither the Company nor the Subsidiary has brought any Legal Action against any thirdparty alleging infringement, misappropriation or violation of Company Intellectual Property Rights that remain unresolved. TheCompany and the Subsidiary, as applicable, have the sole and exclusive right to bring a Legal Action against a third party forinfringement or violation of the Company Intellectual Property Rights.

 

(i)   To the Knowledge of theCompany, the Company Intellectual Property Rights are subsisting, in full force and effect, have not been cancelled or abandoned,have not expired, and, with respect to the Company Registered Intellectual Property Rights only, are valid and enforceable. Tothe Knowledge of the Company, neither the Company, the Subsidiary nor any of their respective officers, employees or agents haveknowingly done, or failed to do, any act or thing which may, after the Effective Time, materially prejudice the validity or enforceabilityof any of the Company Intellectual Property Rights. All necessary registration, maintenance and renewal fees in connection withany Company Registered Intellectual Property Rights have been paid and all necessary documents, recordations and certificates inconnection with such Company Registered Intellectual Property Rights have been filed with the relevant patent, copyright, trademarkor other authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of maintaining such CompanyRegistered Intellectual Property Rights.

 

(j)   There are no actions thatmust be taken by the Company or the Subsidiary within 120 days of the Effective Time, including the payment of any registration,maintenance or renewal fees or the filing of any responses to office actions by the patent, copyright, trademark or other authoritiesin the United States or foreign jurisdictions, documents, applications or certificates for the purposes of obtaining, maintaining,perfecting or preserving or renewing any Company Registered Intellectual Property Rights.

 

(k)   The Company and the Subsidiaryhave made commercially reasonable efforts to protect their respective trade secrets and preserve their status as intellectual propertyunder applicable Law. The Company and the Subsidiary, as applicable, have in place a policy requiring all employees, contractorsand other parties having access to such trade secrets to execute a proprietary information/confidentiality agreement with the Companyor the Subsidiary.

 

(l)   Following the EffectiveTime, the Surviving Corporation will be permitted to exercise all of the rights of the Company or the Subsidiary under such LicenseAgreements or Contracts to the same extent the Company or the Subsidiary would have been able to had the transactions contemplatedhereby not occurred and without the payment of additional amounts or consideration other than ongoing fees, royalties, paymentswhich the Company or the Subsidiary would otherwise be required to pay. The consummation of the Merger and the transactions contemplatedhereby will not (i) result in the breach, modification, cancellation, termination, or suspension of any of the Company’sor the Subsidiary’s License Agreements or any Contract with any customer of the Company or the Subsidiary, or give any Person(other than the Company or the Subsidiary) or a party to any of the Company’s or the Subsidiary’s License

 

  

Agreements or any Contract with any customer of the Company or theSubsidiary the right to do any of the foregoing, (ii) give rise to a right by any third party to obtain, directly from the Companyor the Subsidiary or from escrow, source code for Computer Software or other proprietary materials of the Company or the Subsidiary,(iii) result in the loss or impairment of the Company’s or the Subsidiary’s ownership of or right to use the CompanyIntellectual Property Rights or Licensed Intellectual Property Rights, or (iv) cause Surviving Corporation or any of its Affiliates(x) to be bound by any non-compete or other restriction on the operation of any business or (y) to grant any rights or licensesto any Intellectual Property Rights of the Surviving Corporation or any of its Affiliates to a third party (including, withoutlimitation, a covenant not to sue).

 

(m)   To the Company’sKnowledge, since December 31, 2012, the Company and the Subsidiary have complied in all material respects with all applicableLaws and regulations relating to privacy, data protection and the collection and use of personally identifiable information gatheredor accessed in the course of the operations of the Company and the Subsidiary. To the Company’s Knowledge, the Company andthe Subsidiary have complied in all material respects with all rules, policies and procedures established by the Company or theSubsidiary, as applicable, from time to time with respect to the foregoing, if any. To the Company’s Knowledge, no claimsare pending or threatened or likely to be asserted against the Company or the Subsidiary by any Person alleging a violation ofsuch Person’s privacy, personal or confidentiality rights under any such Laws, regulations, rules, policies or procedures.To the Company’s Knowledge, the consummation of the Merger and the transactions contemplated hereby will not breach or otherwisecause any violation of any such Laws, regulations, rules, policies or procedures.

 

(n)   With respect to sensitivepersonally identifiable information, to the Company’s Knowledge, the Company and the Subsidiary have taken all commerciallyreasonable steps (including, without limitation, implementing and monitoring compliance with adequate measures with respect totechnical and physical security) to ensure that the information is protected against loss and against unauthorized access, use,modification, disclosure or other misuse. To the Knowledge of the Company, there has been no unauthorized access to or other misuseof that information.

 

3.19.   Material Agreements.   Section3.19 of the Company Disclosure Letter sets forth a list of all Company Material Agreements. All of the Company Material Agreementsare in full force and effect and constitute the valid, legal and binding obligation of the Company or the Subsidiary, as applicable,and constitute the valid, legal and binding obligation of the other parties thereof, enforceable against each such Person in accordancewith its terms, subject to (i) the effect of bankruptcy, fraudulent conveyance, reorganization, moratorium and other similar lawsrelating to or affecting the enforcement of creditor’s rights generally, and (ii) general equitable principles (whether consideredin a proceeding in equity or at law). There are no material breaches or defaults by the Company or the Subsidiary under any ofthe Company Material Agreements or, to the Knowledge of the Company, events which with notice or the passage of time would constitutea material breach or default by the Company or the Subsidiary, and neither the Company nor the Subsidiary has received writtennotice of any such material breach or default from any other party under any of the Company Material Agreements. The Company hasmade available to MM true and complete copies of all Company Material Agreements, including all amendments thereto.

 

3.20.   Customers and Suppliers.   TheCompany has delivered to MM a list identifying each customer of the Company and the Subsidiary from which, for the twelve (12)month period ended December 31, 2013 and the eleven month period ended November 30, 2014, the Company and the Subsidiaryreceived revenue (on a consolidated basis) in excess of  $2,000,000 for such year or period, as applicable (collectively,“Company Major Customers”). Section 3.20 of the Company Disclosure Letter sets forth the names of thefive (5) largest suppliers (by consolidated expenditure) to the Company and the Subsidiary for the twelve (12) month period endedDecember 31, 2013 and the eleven month period ended November 30, 2014. Within the preceding twelve (12) months, neitherthe Company nor its Subsidiary has received written or, jrp#to the Knowledge of the Company, oral notice that any Company MajorCustomer or supplier listed in Section 3.20 of the Company Disclosure Letter has: (i) threatened to cancel, suspend or otherwiseterminate, or intends to cancel, suspend or otherwise terminate, any relationships of such Person with the Company or the Subsidiary,(ii) decreased materially or threatened to stop, decrease or limit materially, or intends to modify materially its relationshipswith the Company or the Subsidiary, or (iii) intends to refuse to pay any amount due to the Company or the Subsidiary or seek toexercise any remedy against the

 

 

 

Company or the Subsidiary. Neither the Company nor the Subsidiarywithin the past twelve (12) months have been engaged in any material dispute with any Company Major Customer or supplier listedin Section 3.20 of the Company Disclosure Letter. The Company and the Subsidiary are in compliance in all materialrespects with the insurance requirements set forth in its agreements with each of its customers.

 

3.21.   Agreements with RegulatoryAgencies.   Neither the Company nor the Subsidiary (a) is subject to any cease-and-desist or other Order issuedby, (b) is not a party to any Contract, consent agreement or memorandum of understanding with, (c) is not a party to any commitmentletter or similar undertaking to, (d) is not subject to any order or directive by, (e) is not a recipient of any extraordinarysupervisory letter from, and (f) has not adopted any board resolutions at the request of  (each of clauses (a)-(e) of thisSection 3.21, a “Regulatory Agreement”), any Governmental Entity that restricts the conduct of itsbusiness or that in any manner relates to its management or its business, or would reasonably be expected, following the Mergerand the consummation of the transactions contemplated hereby, to impair in any material respect the Surviving Corporation’sability to conduct the business of the Company and the Subsidiary after the Effective Time, as presently conducted. Neither theCompany nor the Subsidiary have been advised by any Governmental Entity that such Governmental Entity is considering issuing orrequesting any Regulatory Agreement, except for any such proposed Regulatory Agreements that, individually or in the aggregate,would not have or reasonably be expected to result in a Company Material Adverse Effect.

 

3.22.   Related Party Transactions.   Otherthan in respect of Contracts or interests related to employment in the ordinary course of business or incentive arrangements underthe Company Option Plan, no executive officer or director of the Company or the Subsidiary or any Person owning 5% or more of theshares of Company Common Stock (or any of such Person’s immediate family members or Affiliates or associates) is a partyto any Contract with or binding upon the Company or the Subsidiary or any of their respective assets, rights or properties or hasany interest in any property owned by the Company or the Subsidiary or has engaged in any transaction with any of the foregoingwithin the last twelve (12) months.

 

3.23.   Accounts Receivable.   Theaccounts receivable of the Company and the Subsidiary represent or will represent valid, bona fide claims against debtors for salesor other charges arising from sales actually made or services actually performed by the Company or the Subsidiary in the ordinarycourse of business and in conformity in all material respects with the applicable purchase orders, agreements and specifications,and such accounts receivable are not subject to any defenses, set-offs or counterclaims. The Company and the Subsidiary have performedin all material respects all obligations with respect to such accounts receivable which it was obligated to perform through theEffective Time. The Company and the Subsidiary will bill all unbilled receivables in the ordinary course of business consistentwith past practice.

 

3.24.   Insurance.   Allcasualty, general liability, business interruption, product liability, director & officer liability, worker’s compensation,environmental, automobile and sprinkler and water damage and other insurance policies and bond and surety arrangements maintainedby the Company and the Subsidiary are listed in Section 3.24 of the Company Disclosure Letter (the “Company InsurancePolicies”) and true and complete copies of the Company Insurance Policies have been made available to MM. Neither theCompany nor the Subsidiary has received any written notice of cancellation of premium increase with respect to or alteration ofcoverage under any Company Insurance Policy since January 1, 2014. Neither the Company nor the Subsidiary has received anywritten notice that any carrier is financially insolvent. There are no claims related to the business of the Company and the Subsidiarypending under any Company Insurance Policy as to which coverage has been questioned, denied or disputed or in respect of whichthere is an outstanding reservation of rights. Neither the Company nor the Subsidiary is in default under, or has otherwise failedto comply with, in any material respect, any provision contained in any Company Insurance Policy. Since January 1, 2011, anyclaims under any Company Insurance Policy have been reported to carriers in a timely manner. All such Company Insurance Policies:(x) are valid and binding in accordance with their terms; (y) to the Knowledge of the Company, are provided by carriers who arefinancially solvent; and (z) have not been subject to any lapse in coverage. The Company Insurance Policies are of the type andin the amounts customarily carried by Persons conducting a business similar to the Company and the Subsidiary and are sufficientfor compliance, in all material respects, with all applicable Laws and Contracts to which the Company or the Subsidiary is a partyor by which they are bound.

 

3.25.   Board Approval.   TheBoard of Directors of the Company has, as of the date hereof, unanimously (i) approved this Agreement and the transactions contemplatedhereby, subject to stockholder

 

 

 

approval, (ii) determined that the Merger is fair to and in thebest interests of the stockholders of the Company, and (iii) recommended that the stockholders of the Company approve and adoptthis Agreement and approve the Merger (collectively, the “Company Board Recommendation”).

 

3.26.   Vote Required.   Theaffirmative vote of the holders of a majority of the outstanding shares of Company Common Stock in accordance with the DGCL andthe Company’s Certificate of Incorporation and Bylaws (the “Company Stockholders’ Approval”) isthe only vote of the holders of any class or series of the Company’s capital stock necessary to approve and adopt this Agreementand approve the Merger and the transactions contemplated hereby.

 

3.27.   Opinion of FinancialAdvisor.   The Company has received the opinion of The BVA Group LLC (the “Company Financial Advisor”),dated the date hereof, to the effect that the consideration to be received in the Merger by the stockholders of the Company isfair from a financial point of view to the stockholders of the Company, and a true and complete copy of the final draft of suchopinion has been delivered to MM prior to the execution of this Agreement. The Company Financial Advisor has not had any relationshipor business dealings with the Company, the Subsidiary or any of their respective Affiliates other than with respect to the deliveryof the opinion described in this Section 3.27.

 

3.28.   Section 203 of theDGCL Not Applicable.   The Company has taken all necessary actions so that the provisions of Section 203 ofthe DGCL will not apply to this Agreement, the Merger or the other transactions contemplated hereby.

 

**ArticleIV**

**REPRESENTATIONS AND WARRANTIES OF MM**

** **

MM hereby represents and warrants to the Company,subject to such exceptions as are specifically disclosed in writing (with reference to a specific section of this Agreement towhich each such exception applies) in the disclosure letter supplied by MM to the Company, dated as of the date hereof (the “MM Disclosure Letter”) as follows:

 

4.1.   Organization and Qualification;Subsidiaries.

 

(a)   Section 4.1(a) ofthe MM Disclosure Letter sets forth a list of all of MM’s subsidiaries as of the date hereof  (the “existingsubsidiaries”) and all of the entities that will become direct or indirect subsidiaries of MM pursuant to the MM Reorganization(the “Reorg Subsidiaries”). All references to subsidiaries in this Article IV shall be deemed to includeboth existing subsidiaries and the Reorg Subsidiaries. Each of MM and its subsidiaries is duly formed and organized, validly existingand in good standing under the Laws of the jurisdiction of its formation or incorporation and has the requisite corporate powerand authority to own, lease and operate its assets and properties and to carry on its business as it is now being conducted. Eachof MM and its subsidiaries is in possession of all Approvals necessary to own, lease and operate the properties it purports toown, operate or lease and to carry on its business as it is now being conducted, except where the failure to have such Approvalswould not, individually or in the aggregate, have or reasonably be expected to have a MM Material Adverse Effect. Each of MM andits subsidiaries, as applicable, are duly qualified or licensed as a foreign corporation to do business, and are in good standing,in each jurisdiction where the character of the properties owned, leased or operated by such entity or the nature of its activitiesmakes such qualification or licensing necessary, except for such failures to be so duly qualified or licensed and in good standingthat would not, either individually or in the aggregate, have or reasonably be expected to have a MM Material Adverse Effect.

 

(b)   MM has no subsidiariesexcept the subsidiaries set forth on Section 4.1(a) of the MM Disclosure Letter and owns no debt, equity or other similarinterest in any other Person except in such subsidiaries. Except as otherwise set forth in Section 4.1(a) of the MM DisclosureLetter, each of the subsidiaries set forth in Section 4.1(a) of the MM Disclosure Letter is wholly owned by MM or will bewholly owned by MM upon completion of the MM Reorganization. Except as required for, or contemplated by, the MM Reorganization,neither MM nor any of its subsidiaries have agreed, are obligated to make, or are bound by, any Contract, under which it may becomeobligated to make, any future investment in or capital contribution to any other Person. Neither MM nor any of its subsidiariesdirectly or indirectly own any equity or similar interest in or any interest convertible, exchangeable or exercisable for, anyequity or similar interest in, any other Person.

 

  

4.2.   Articles of Incorporationand Bylaws.   MM and its subsidiaries have previously furnished to the Company complete and correct copies oftheir respective organizational documents as amended to date. Such organizational documents are in full force and effect. NeitherMM nor any of its subsidiaries are in violation of any of the provisions of their respective organizational documents in any materialrespect.

 

4.3.   Capitalization.

 

(a)   The authorized capitalstock of MM consists of 300,000,000 shares of stock with a par value of  $0.002 per share (the “MM Stock”)as of the close of business on the date hereof and will consist of 500,000,000 shares of stock with a par value of  $0.002per share at the Effective Time. As of the close of business on the date hereof, there were (i) 183,450,000 shares of MM Stockissued and outstanding, all of which are validly issued, fully paid and non-assessable and (ii) no shares of MM Stock held in treasuryby MM. Section 4.3(a) of the MM Disclosure Letter sets forth: (i) the name of each Person that is a record or beneficialowner of MM Stock; (ii) the number of shares of MM Stock owned by each such Person; (iii) the number of such shares of MM Stockwith respect to which such Person has sole or shared dispositive control (and, if such Person shares dispositive control, the nameof the Person or Persons with whom it shares such control); and (iv) if such Person is not an individual, the names of each Personthat controls (as defined in the definition of Affiliate) such Person. All shares of MM Stock subject to the issuance aforesaid,upon issuance on the terms and conditions specified in the instrument pursuant to which they are issuable, would be duly authorized,validly issued, fully paid and non-assessable. There are no commitments or agreements of any character to which MM is bound obligatingMM to accelerate the vesting of any option, warrant or other security or right exercisable for or convertible into MM Stock asa result of the Merger. All outstanding shares of MM Stock, and all outstanding equity securities of MM’s subsidiaries havebeen issued and granted in compliance in all material respects with (i) all applicable Laws and any Orders or otherwise put intoeffect by or under the authority of any Governmental Entity and (ii) all requirements set forth in applicable Contracts.

 

(b)   Except as set forth inSection 4.3(a) hereof, there are no subscriptions, options, warrants, equity securities, equity-linked securities, appreciationrights, phantom equity, partnership interests or similar ownership interests, calls, rights (including preemptive rights), Contracts,commitments or agreements of any character to which MM or any of its subsidiaries is a party or by which any are bound obligatingMM or any of its subsidiaries to issue, deliver or sell, or cause to be issued, delivered or sold, or repurchase, redeem or otherwiseacquire, or cause the repurchase, redemption or acquisition of, or deliver cash or other consideration with respect to, any sharesof capital stock, partnership interests or similar ownership interests or equity-linked securities of MM or any of its subsidiariesor obligating MM or any of its subsidiaries to grant, extend, accelerate the vesting of or enter into any such subscription, option,warrant, equity security, equity-linked security, appreciation rights, call, right, commitment or agreement. Except as contemplatedby this Agreement, there are no registration rights and there is no voting trust, proxy, rights plan, antitakeover plan or otheragreement or understanding to which MM or any of its subsidiaries is a party or by which any are bound with respect to any equitysecurity of any class of MM or any of its subsidiaries.

 

4.4.   Authority Relative tothis Agreement.   MM has all necessary corporate power and authority to execute and deliver this Agreement andthe Transaction Documents and to perform its obligations hereunder and thereunder. The execution and delivery of this Agreementand the Transaction Documents by MM and the consummation by MM of the transactions contemplated hereby and thereby have been dulyand validly authorized by all necessary corporate action on the part of MM and no other corporate proceedings on the part of MMare necessary to authorize this Agreement and the Transaction Documents or to consummate the transactions so contemplated. ThisAgreement and the Transaction Documents have been duly and validly executed and delivered by MM and, assuming the due authorization,execution and delivery by the Company, constitute the legal and binding obligation of MM, enforceable against MM in accordancewith their respective terms, subject to (i) the effect of bankruptcy, fraudulent conveyance, reorganization, moratorium and othersimilar laws relating to or affecting the enforcement of creditor’s rights generally, and (ii) general equitable principles(whether considered in a proceeding in equity or at law).

 

  

4.5.    No Conflict; Required Filingsand Consents.

 

(a)   The execution and deliveryof this Agreement and the Transaction Documents by MM do not, and the performance of this Agreement and the Transaction Documentsby MM will not, (i) conflict with or violate the Articles of Incorporation or Bylaws or equivalent organizational documents ofMM or any of its subsidiaries, (ii) subject to obtaining the consents, approvals, authorizations and permits and making the registrations,filings and notifications set forth in Section 4.5(b) hereof  (or Section 4.5(b) of the MM Disclosure Letter),conflict with or violate any Law applicable to MM or any of its subsidiaries or the Contributed Assets or by which either or anyof their respective properties is bound or affected, (iii) except as set forth on Section 4.5(a)(iii) of the MM DisclosureLetter, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default)under, or impair MM’s or any of its subsidiaries’ rights or alter the rights or obligations of any third party under,or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien onany of the properties or assets of MM or any of its subsidiaries or the Contributed Assets pursuant to, any material Contract towhich MM or any of its subsidiaries is a party or by which MM or any of its subsidiaries or the Contributed Assets or any of theirrespective properties are bound or affected, or (iv) cause the acceleration of any vesting of any awards for or rights toMM Stock or the payment of or the acceleration of payment of any change in control, severance, bonus or other cash payments orissuance of MM Stock, except in the case of clauses (ii) and (iii), to the extent such conflict, violation, breach, default, impairmentor other effect would not, individually or in the aggregate, reasonably be expected to have a MM Material Adverse Effect.

 

(b)   Except as set forth onSection 4.5(b) of the MM Disclosure Letter, the execution and delivery of this Agreement and the Transaction Documents byMM does not, and the performance of this Agreement and the Transaction Documents by MM will not, require any consent, approval,authorization or permit of, or registration, filing with or notification to, any Governmental Entity, except for (i) applicablerequirements, if any, of the Securities Act, Exchange Act, Blue Sky Laws, and of foreign Governmental Entities and the rules andregulations promulgated thereunder, (ii) the filing and recordation of the Certificates of Merger as required by the CGCL and theDGCL, as applicable, and (iii) such consents, approvals, authorizations, permits, filings or notifications which, if not obtainedor made, would not have a MM Material Adverse Effect.

 

4.6.   Compliance; Permits.

 

(a)   Neither MM nor any of itsAffiliates is in conflict with, or in default or violation of: (i) any Law or Order applicable to MM or any of its subsidiariesor the Contributed Assets, or by which any of the respective properties of MM or any of its subsidiaries or the Contributed Assetsare bound or affected, or (ii) any Contract to which MM or any of its subsidiaries is a party or by which MM or any of its subsidiariesor the Contributed Assets or any of their respective properties are bound or affected, except for any conflicts, defaults or violationsof such Laws, Orders or Contracts that (individually or in the aggregate) would not have or reasonably be expected to have a MMMaterial Adverse Effect. Except as set forth in Section 4.6 of the MM Disclosure Letter, no Governmental Entity has indicatedin writing to MM or any of its Affiliates an intention to conduct an investigation or review against MM, its subsidiaries or theContributed Assets, and, to the Knowledge of MM, no investigation or review by any Governmental Entity is pending or threatenedagainst MM, its subsidiaries or the Contributed Assets, other than, in each such case, those the outcome of which would not, individuallyor in the aggregate, have or reasonably be expected to have a MM Material Adverse Effect.

 

(b)   MM and its Affiliates holdall permits, licenses, variances, exemptions, orders and approvals from Governmental Entities which are material to operation ofthe business of MM, its subsidiaries and the Contributed Assets as currently conducted (collectively, the “MM Permits”).To the Knowledge of MM, MM and its Affiliates are in compliance in all material respects with the terms of the MM Permits.

 

4.7.   No Undisclosed Liabilities.   Exceptfor matters reflected or reserved against in the balance sheet as of September 30, 2014 included in the MM Financial Statementsor the MM US GAAP Financials, neither MM nor any of its subsidiaries had at such date, or has incurred since that date, any Liabilitiesor obligations (whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature thatwould be required by GAAP to be reflected on a consolidated balance sheet of MM and its

 

 

 

consolidated subsidiaries (including the notes thereto), exceptLiabilities or obligations which were incurred in the ordinary course of business consistent with past practice (none of whichis a Liability for breach of contract, breach of warranty, tort, infringement or a Legal Action for environmental Liability) orLiabilities which would not be reasonably expected to have, individually or in the aggregate, a MM Material Adverse Effect.

 

4.8.   Absence of Certain Changesor Events.   Since March 31, 2014, except as described in the MM Disclosure Letter or as otherwise requiredfor, or contemplated by, the MM Reorganization, neither MM nor any of its subsidiaries, or with respect to the Contributed Assetsonly, any of its Affiliates, have:

 

(i)   sold or transferred anyportion of their respective assets or property that would be material to MM or any of its subsidiaries or the Contributed Assets,except for sales in the ordinary course of business consistent with past practice;

 

(ii)   suffered any materialloss, or any material interruption in use, of any material assets or property on account of fire, flood, riot, strike or otherhazard or Act of God that is not covered by insurance;

 

(iii)   suffered any changeto their respective businesses which has had, or would reasonably be expected to have, a MM Material Adverse Effect;

 

(iv)   entered into any Contractthat would constitute a MM Material Agreement;

 

(v)   terminated or materiallymodified, waived any material right under or cancelled any MM Material Agreement or waived any material right with respect to anyof the items disclosed in Section 4.17 of the MM Disclosure Letter;

 

(vi)   incurred any Liens onany material assets or property, or any Liabilities, except for Liabilities incurred in the ordinary course of business consistentwith past practice which are not material to their respective business;

 

(vii)   granted any registrationrights with respect to any of their respective equity securities;

 

(viii)   paid or declared anydividends or other distributions on their respective equity securities of any class or issued, purchased or redeemed any of theirrespective equity securities of any class;

 

(ix)   transferred, assignedor granted any license or sublicense of any material rights under or with respect to items disclosed in Section 4.17 of the MMDisclosure Letter;

 

(x)   made any material capitalexpenditures;

 

(xi)   split, combined or reclassifiedany shares of their respective equity securities;

 

(xii)   made any capital investmentin, or any loan to, any other Person;

 

(xiii)   amended any of theirrespective organizational or constituent documents;

 

(xiv)   paid or materially increasedany bonuses, salaries, or other compensation to any director, officer, or employee, except pursuant to a MM Benefit Plan or inthe ordinary course of business consistent with past practice;

 

(xv)   adopted, modified orincreased payments or benefits under any MM Benefit Plan;

 

(xvi)   entered into, terminated,or received notice of termination of any (a) license, distributorship, dealer, sales representative, joint venture, credit or similaragreement, or (b) Contract or transaction involving a total remaining commitment of at least $250,000;

 

(xvii)   materially changedany accounting method, assumption or period, made, changed or revoked any Tax election, filed a Tax Return in a jurisdiction inwhich a Tax Return was not previously filed, failed to file any Tax Return (taking into account extensions of time to file) consentedto any extension or waiver of the limitations period applicable to any Tax claim or assessment, entered into a closing agreement,or settled any administrative or judicial proceeding related to Taxes;

 

 

 

(xviii)   materially changedcash management practices with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts,accrual of accounts receivable, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of otherexpenses, deferral of revenue and acceptance of customer deposits;

 

(xix)   instituted, settledor compromised any Legal Actions pending or threatened before any arbitrator, court or other Governmental Entity involving thepayment of monetary damages of any amount exceeding $250,000 in the aggregate; or

 

(xx)   agreed or committed,whether orally or in writing, to do any of the foregoing.

 

4.9.   Absence of Litigation.   Exceptas required for, or contemplated by, the MM Reorganization, to the Knowledge of MM, there are no Legal Actions pending or threatenedagainst MM or any of its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates, or any propertiesor rights of MM or any of its subsidiaries or the Contributed Assets, before any Governmental Entity.

 

4.10.   Employee Benefit Plans.

 

(a)   Each “employee benefitplan,” as defined in Section 3(3) of ERISA and all other pension, retirement, supplemental retirement, deferred compensation,excess benefit, profit sharing, bonus, incentive, stock purchase, stock ownership, stock option, stock appreciation right, profitsinterest, employment, severance, salary continuation, termination, change-of-control, health, life, disability, group insurance,vacation, holiday and fringe benefit plan, program, contract, or arrangement (whether written or unwritten, qualified or nonqualified,funded or unfunded and including any that have been frozen or terminated) maintained, contributed to, or required to be contributedto, by (i) MM, (ii) any of its subsidiaries, (iii) the Contributed Assets or (iv) any trade or business (whether or not incorporated)which is an ERISA Affiliate, under which MM or any ERISA Affiliate has any Liability with respect to any current or former employee,director, officer or independent contractor of MM or any of its subsidiaries or, with respect to the Contributed Assets, any ofits Affiliates (the “MM Benefit Plans”), are listed in Section 4.10(a) of the MM Disclosure Letter. MMhas made available to the Company, as applicable: (i) correct and complete copies of all documents embodying each MM Benefit Planincluding (without limitation) all amendments thereto, all related trust documents, and all material written agreements and contractsrelating to each such MM Benefit Plan; (ii) the three (3) most recent annual reports (Form Series 5500 and all schedules and financialstatements attached thereto), if any, required under ERISA or the Code in connection with each MM Benefit Plan; (iii) the mostrecent summary plan description together with the summary(ies) of material modifications thereto, if any, required under ERISAwith respect to each MM Benefit Plan; (iv) all IRS determination, opinion, notification and advisory letters; (v) to the extentavailable, all material correspondence to or from any Governmental Entity relating to any MM Benefit Plan; (vi) to the extent available,all COBRA forms and related notices within the last three (3) years; (vii) to the extent available, all discrimination tests forthe MM Benefit Plan for the most recent three (3) plan years; (viii) the most recent annual actuarial valuations, if any, preparedfor each MM Benefit Plan; (ix) the most recent annual and periodic accounting of the MM Benefit Plan assets; (x) all material writtenagreements and contracts relating to each MM Benefit Plan, including, but not limited to, administrative service agreements, groupannuity contracts and group insurance contracts; (xi) all material communications generally distributed to all employees or formeremployees within the last three (3) years relating to any amendments, terminations, establishments, increases or decreases in benefits,acceleration of payments or vesting schedules or other events which would result in any material Liability under any MM BenefitPlan or proposed MM Benefit Plan; (xii) all policies pertaining to fiduciary liability insurance covering the fiduciaries for eachMM Benefit Plan; and (xiii) all registration statements, annual reports and prospectuses prepared in connection with any MM BenefitPlan.

 

(b)   MM and each ERISA Affiliateare in compliance in all material respects with the provisions of ERISA, the Code and all statutes, orders, rules and regulations(foreign or domestic) applicable to the MM Benefit Plans. Each MM Benefit Plan is and has been maintained, operated and administeredin compliance in all material respects with its terms and any related documents or agreements and the applicable provisions ofERISA, the Code and all statutes, orders, rules and regulations (foreign or domestic) which are applicable to such MM Benefit Plans.

 

 

 

(c)   No Legal Actions (excludingindividual claims for benefits incurred in the normal operation of any MM Benefit Plan) have been brought, or to the Knowledgeof MM is threatened, against or with respect to any such MM Benefit Plan. Neither MM nor any of its Affiliates has received anycorrespondence from the IRS or the DOL regarding, and, to the Knowledge of MM, there are no audits, enquiries or proceedings pendingor, threatened by the IRS or the DOL with respect to any MM Benefit Plans. All contributions, reserves or premium payments requiredto be made or accrued as of the date hereof and as of the Closing Date to MM Benefit Plans have or will have been timely made oraccrued.

 

(d)   Any MM Benefit Plan intendedto be qualified under Section 401(a) of the Code and each trust intended to qualify under Section 501(a) of the Code has obtained(or has an outstanding application for) a favorable determination, notification, advisory and/or an opinion letter, as applicable,as to its qualified status from the IRS, and, to the Knowledge of MM, nothing has occurred with regard to each such pension planand the related trusts that could jeopardize such qualified status and exemption from taxation under Section 501(a) of the Code.MM does not have any plan or commitment to establish any new MM Benefit Plan, to materially modify any MM Benefit Plan (exceptto the extent required by Law or to conform any such MM Benefit Plan to the requirements of any applicable Law, in each case aspreviously disclosed to MM in writing, or as required by this Agreement), or to enter into any new MM Benefit Plan.

 

(e)   No MM Benefit Plan is nowor at any time has been subject to Part 3, Subtitle B of Title I of ERISA or Title IV of ERISA. Neither MM nor any ERISA Affiliatehas ever contributed to, or been required to contribute to any “multiemployer plan” (within the meaning of Section3(37) of ERISA) and neither MM nor any ERISA Affiliate has any Liability (contingent or otherwise) relating to the withdrawal orpartial withdrawal from a multiemployer plan. Neither MM nor any of its subsidiaries or, with respect to the Contributed Assetsonly, any of its Affiliates, is subject to any Liability or penalty under Section 4975 through 4980B of the Code or Title I ofERISA (other than routine claims for benefits under any MM Benefit Plan). No “prohibited transaction,” within the meaningof Section 4975 of the Code or Sections 406 and 407 of ERISA, and not otherwise exempt under Section 408 of ERISA, has occurredwith respect to any MM Benefit Plan that would reasonably be expected to impose a material Liability on MM or any of its subsidiariesor the Contributed Assets.

 

(f)   MM, its subsidiaries andeach ERISA Affiliate have complied in all material respects with the notice and continuation coverage requirements of COBRA. Noneof the MM Benefit Plans promises or provides retiree medical or other retiree welfare benefits to any Person except as requiredby applicable Law and neither MM nor any of its subsidiaries have represented, promised or contracted (whether in oral or writtenform) to provide such retiree benefits to any employee, former employee, director, consultant or other Person, except to the extentrequired by Law.

 

(g)   Neither the execution anddelivery of this Agreement or the Transaction Documents nor the consummation of the transactions contemplated hereby and thereby,solely by themselves, will (i) result in any material payment (including severance, unemployment compensation, golden parachute,bonus or otherwise) becoming due to any stockholder, director or employee of MM, any of its subsidiaries or the Contributed Assetsunder any MM Benefit Plan or otherwise, (ii) materially increase any benefits otherwise payable under any MM Benefit Plan, (iii)limit the right to merge, amend or terminate any MM Benefit Plan, or (iv) result in the acceleration of the time of payment orvesting of any such benefits.

 

(h)   No payment or benefit thatwill or may be made by MM or its ERISA Affiliates with respect to any employee, former employee, director, officer or independentcontractor of MM, any of its subsidiaries or the Contributed Assets, either alone or in conjunction with any other payment, eventor occurrence, (X) will or could reasonably be characterized as an “excess parachute payment” under Section 280G ofthe Code or (Y) will not be fully deductible as a result of Section 162(m) of the Code. There is no Contract to which MM or anyof its subsidiaries is a party or by which they or the Contributed Assets are bound to compensate any individual for excise taxespaid pursuant to Section 4999 of the Code.

 

(i)   Section 4.10(i)of the MM Disclosure Letter sets forth the name, title and current annual salary of all present officers and employees of MM, andits subsidiaries or any other officer or employee who will become officers or employees in connection with the Contributed Assetswhose rate of annual

 

 

 

compensation equals or exceeds $250,000 together with a statementof the full amount of all remuneration paid by MM or its Affiliates to each such person, during the twelve (12)-month period endedMarch 31, 2014 and the six month period ended September 30, 2014.

 

(j)   Except as would not reasonablybe expected to result in a material liability to MM, each MM Benefit Plan that constitutes a “non-qualified deferred compensationplan” within the meaning of Section 409A of the Code, complies in both form and operation with the requirements of Section409A of the Code so that no amounts paid pursuant to any such MM Benefit Plan is subject to tax under Section 409A of the Code.

 

(k)   Neither MM nor any of itssubsidiaries or, with respect to the Contributed Assets only, its Affiliates has or is required to have an International EmployeePlan.

 

(l)   MM and each ERISA Affiliatehas, for purposes of each MM Benefit Plan, correctly classified all individuals performing services for MM as common law employees,leased employees, independent contractors or agents, as applicable.

 

4.11.   Labor Matters.

 

(a)   Neither MM nor any of itsAffiliates is a party to any collective bargaining agreement or other labor union contract applicable to Persons employed by MM,any of its subsidiaries or the Contributed Assets nor does MM have Knowledge of any activities or proceedings of any labor unionto organize any such employees or Knowledge of any strikes, slowdowns, work stoppages or lockouts, or threats thereof, by or withrespect to any employees of MM, any of its subsidiaries or the Contributed Assets.

 

(b)   During the past three (3)years, (i) each of MM and its Affiliates is and has been in material compliance with all applicable Laws with respect to laborand employment with respect to the employees of MM or any of its subsidiaries or the Contributed Assets, including, without limitation,Laws with respect to fair employment practices, discrimination, immigration and naturalization, retaliation, work place safetyand health, unemployment compensation, workers’ compensation, affirmative action, terms and conditions of employment andwages and hours, (ii) to the Knowledge of MM, there have been no Legal Actions pending before any Governmental Entity, or threatsthereof with respect to labor and employment matters, including Legal Actions between MM or any of its Affiliates (on the one hand)and any of the current or former employees or current or former workers of MM or any of its subsidiaries or the Contributed Assets(on the other hand), (iii) there have been no written notices of charges of discrimination in employment or employment practicesfor any reason or noncompliance with any other Law with respect to labor or employment that have been asserted, or, to the Knowledgeof MM, threats thereof, before the United States Equal Employment Opportunity Commission or any other Governmental Entity, (iv)neither MM nor any of its Affiliates has been a party to, or otherwise bound by, any consent decree or settlement agreement with,or citation by, any Governmental Entity relating to the current or former employees of MM or any of its subsidiaries or the ContributedAssets or employment practices of MM or any of its subsidiaries, or with respect to the Contributed Assets only, its Affiliates,and (v) to the Knowledge of MM, neither MM nor any of its Affiliates has been subject to any audit or investigation by the OccupationalSafety and Health Administration, the DOL, or other Governmental Entity with respect to labor or employment Laws applicable toMM or any of its subsidiaries or the Contributed Assets or with respect to the employees of MM or any of its subsidiaries or theContributed Assets, or subject to fines, penalties, or assessments associated with such audits or investigations.

 

(c)   To the Knowledge of MM,all of the employees of MM, its subsidiaries and the Contributed Assets employed in the United States are (i) United States citizensor lawful permanent residents of the United States, (ii) aliens whose right to work in the United States is unrestricted, or (iii)aliens who have valid, unexpired work authorizations issued by the United States government.

 

(d)   Neither MM nor any of itsAffiliates has experienced a “plant closing,” “business closing,” or “mass layoff” as definedin the WARN Act or any similar state, local or foreign law or regulation affecting any site of employment of MM or any of its subsidiariesor the Contributed Assets or one or more facilities or operating units within any site of employment or facility of MM or any ofits subsidiaries or the Contributed Assets, and, during the ninety (90) day period preceding the date hereof, no Person has

 

 

 

suffered an “employment loss” (as defined in the WARNAct) with respect to MM or any of its subsidiaries or the Contributed Assets. Except as set forth in Section 4.10(i) ofthe MM Disclosure Letter, in the past twelve (12) months no officer’s or key employee’s employment with MM or any ofits subsidiaries or the Contributed Assets has been terminated for any reason, and, to the Knowledge of MM, no officer or key employeehas expressed any plans to terminate his, her or their employment or service arrangement with MM or any of its subsidiaries orthe Contributed Assets.

 

(e)   To the Knowledge of MM,MM and its subsidiaries have properly treated all individuals performing rendered services to MM or any of its subsidiaries orthe Contributed Assets as employees, leased employees, independent contractors or agents, as applicable, for all federal, statelocal and foreign Tax purposes. There has been no determination by any Governmental Entity that any independent contractor is anemployee of MM or any of its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates.

 

4.12.   Registration Statement;Proxy Statement.   None of the information supplied or to be supplied by MM or any of its Affiliates for inclusionor incorporation by reference in (i) the Proxy Statement and the Registration Statement will contain any untrue statement of amaterial fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein,in light of the circumstances under which they are made, not misleading, and (ii) the Proxy Statement and the Registration Statementwill, on the dates mailed to the stockholders of the Company, at the time of the Company Stockholders’ Meeting and as ofthe Effective Time, contain any untrue statement of a material fact or omit to state any material fact required to be stated thereinor necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading.The Registration Statement and the Proxy Statement will comply as to form in all material respects with the provisions of the ExchangeAct and the Securities Act and the rules and regulations promulgated by the SEC thereunder.

 

4.13.   Restrictions on BusinessActivities.   There is no agreement, commitment, judgment, injunction, order or decree binding upon MM or anyof its subsidiaries or, with respect the Contributed Assets only, its Affiliates or to which MM or any of its subsidiaries or,with respect the Contributed Assets only, its Affiliates is a party which has or would reasonably be expected to have the effect,in any material respect, of prohibiting or impairing any present business practice of MM or any of its subsidiaries or the ContributedAssets, any acquisition of property by MM or any of its subsidiaries or the Contributed Assets or the conduct of business by MMor any of its subsidiaries or the Contributed Assets as currently conducted.

 

4.14.   Title to Property.   

 

(a)   Neither MM nor any of itssubsidiaries or, with respect to the Contributed Assets only, its Affiliates own any real property. Section 4.14 of theMM Disclosure Letter identifies by street address all real property leased or subleased by MM, its subsidiaries and, with respectto the Contributed Assets only, its Affiliates (the “MM Leased Real Estate”). All MM Leased Real Estate is leasedto them pursuant to written leases (collectively the “MM Leases”). MM, its subsidiaries and, with respect tothe Contributed Assets only, its Affiliates, have a valid leasehold interest in the MM Leased Real Estate, free and clear of allLiens. Except as otherwise set forth in Section 4.14 of the MM Disclosure Letter, neither MM nor any of its Affiliates hassubleased any MM Leased Real Estate. The MM Leased Real Estate is not subject to any third-party licenses, concessions, leasesor tenancies of any kind, except as indicated on the MM Disclosure Letter. The MM Leases are in full force and effect. There areno defaults in any material respect on the part of any landlord or MM or any of its Affiliates under the MM Leases. MM, its subsidiariesand its Affiliates, have performed in all material respects all of the obligations on their respective parts to be performed underthe MM Leases. No written consent of any landlord under the MM Leases is required or necessary in order to consummate the transactionscontemplated by this Agreement and the Transaction Documents.

 

(b)   Neither MM, any of itssubsidiaries, or with respect to the Contributed Assets only, its Affiliates, has received written notice that the use or occupancyof the MM Leased Real Estate violates in any material respect any covenants, conditions or restrictions that encumber such property,or that any such property is subject to any restriction for which any material permits necessary to the current use thereof havenot been obtained.

 

 

 

(c)   To the Knowledge of MM,there are no pending or threatened condemnation proceedings with respect to any material portion of the MM Leased Real Estate.

 

4.15.   Taxes.

 

(a)   Tax Returns and Audits.

 

(i)   MM and its subsidiarieshave timely filed all Tax Returns relating to Taxes required to be filed by them in all the jurisdictions in which MM or any ofits subsidiaries (x) are qualified to do business and (y) they operate, except with respect to clause (y) as would not be reasonablyexpected to result in a MM Material Adverse Effect. Except as disclosed in Section 4.15 of the MM Disclosure Letter, suchTax Returns are true and correct in all material respects, have been completed in accordance with applicable Law, and all Taxesshown to be due on such Tax Returns have been paid. MM has delivered to the Company correct and complete copies of all Tax Returns,examination reports, and statements of deficiencies assessed against or agreed to by MM, any of its subsidiaries filed or receivedsince December 31, 2010. There are no liens for Taxes (other than Taxes not yet due and payable) upon any assets of MM orany of its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates.

 

(ii)   MM and its subsidiariesas of the Effective Time will have withheld with respect to their respective employees all federal and state income Taxes, Taxespursuant to the Federal Insurance Contribution Act, Taxes pursuant to the Federal Unemployment Tax Act and other Taxes requiredto be withheld.

 

(iii)   Neither MM nor any ofits subsidiaries has been delinquent in the payment of any Tax nor is there any Tax deficiency outstanding, proposed or assessedagainst MM or any of its subsidiaries, nor has MM or any of its subsidiaries executed any unexpired waiver of any statute of limitationson or extending the period for the assessment or collection of any Tax.

 

(iv)   Except as disclosed inSection 4.15 of the MM Disclosure Letter, to the Knowledge of MM, no audit or other examination of any Tax Return of MMor any of its subsidiaries by any tax authority is presently in progress. Neither MM nor any of its subsidiaries has been notifiedin writing of any such audit or other examination. MM and each of its subsidiaries have paid in full any demands raised by anytax authority as a result of any audit that has been previously conducted.

 

(v)   No adjustment relatingto any Tax Returns filed by MM or any of its subsidiaries has been proposed in writing formally or informally by any tax authorityto MM or any of its subsidiaries or any Representative thereof.

 

(vi)   Neither MM nor any ofits subsidiaries has any Liability for any unpaid Taxes, whether or not such Taxes have been accrued for or reserved on the MMFinancial Statements or the MM US GAAP Financials in accordance with GAAP or whether or not asserted or unasserted, contingentor otherwise, except for Taxes not yet due and payable or which are being contested in good faith.

 

(b)   Tax Agreements.   NeitherMM nor any of its subsidiaries is party to or has any obligation under any Tax-sharing, Tax indemnity or Tax allocation agreementor arrangement other than agreements between MM and any of its subsidiaries.

 

(c)   No Intent to AcquireMM Stock.   MM does not have any plan or intention to reacquire, and to MM’s Knowledge, no person relatedto MM within the meaning of Section 1.368-1(e)(3) of the United States Income Tax Regulations has any plan or intention to acquire,any MM Stock issued in the Merger.

 

(d)   No Other Actions.   NeitherMM nor any of its Affiliates has taken or agreed to take any action, or is aware of any fact or circumstance, that could reasonablybe expected to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code.

 

4.16.   Environmental Matters.

 

(a)   To the Knowledge of MM,MM, its subsidiaries and, with respect to the Contributed Assets only, its Affiliates, are in compliance, in all material respects,with all applicable Environmental Laws and Environmental Permits.

 

 

 

(b)   MM, its subsidiaries and,with respect to the Contributed Assets only, its Affiliates, possess all material Environmental Permits which are required forthe operation of their respective businesses.

 

(c)   To the Knowledge of MM,there is no Environmental Claim pending or overtly threatened against MM, its subsidiaries or, with respect to the ContributedAssets only, its Affiliates.

 

(d)   To the Knowledge of MM,neither MM nor any of its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates, have treated, stored,disposed of, arranged for or permitted the disposal of, transported, handled, released or exposed any Person to any Hazardous Substancesor owned or operated any property or facility (and no such property or facility is contaminated by any Hazardous Substance), soas to give rise to any Environmental Claim.

 

(e)   Without limiting the generalityof the foregoing, to the Knowledge of MM, neither MM nor any of its subsidiaries or the Contributed Assets have any outstandinglegal or contractual obligation under any applicable Environmental Law, or any unresolved enforcement action or Liability pursuantto any Environmental Law, including but not limited to, any outstanding investigation, cleanup, removal, response activity, remediation,or corrective action obligation under any applicable Environmental Law or any outstanding indemnification obligation owed to anythird party under any applicable Environmental Law relating to the MM Leased Real Estate, any formerly owned or operated property,or any offsite disposal location.

 

(f)   To the Knowledge of MM,neither this Agreement or the Transaction Documents nor the consummation of the transactions contemplated hereby and thereby willresult in any obligations for site investigation or cleanup, or notification to or consent of any governmental entity or thirdparties, pursuant to any of the so-called “transaction-triggered” or “responsible property transfer” EnvironmentalLaws.

 

(g)   MM and its Affiliateshave made available to the Company copies of all material Environmental Permits, studies, reports and audits or correspondenceto or from any government authority pertaining to MM Leased Real Estate that are within MM’s and its Affiliates’ possessionor control.

 

4.17.    Intellectual Property.

 

(a)   Section 4.17(a)(i)of MM Disclosure Letter contains an accurate and complete list of all MM Registered Intellectual Property Rights, specifying asto each such Registered Intellectual Property Right, as applicable, (i) the jurisdictions by or in which such Registered IntellectualProperty Right has been issued or registered or in which an application for such issuance or registration has been filed and (ii)the registration or application numbers thereof. Section 4.17(a)(ii) of the MM Disclosure Letter contains an accurate andcomplete list of all MM Intellectual Property Rights that are material to the business of MM or any of its subsidiaries or withrespect to the Contributed Assets. Section 4.17(a)(iii) of the MM Disclosure Letter contains an accurate and complete listof all material Computer Software that is owned, licensed, leased or otherwise used in the business of MM or any of its subsidiariesor with respect to the Contributed Assets, excluding (x) commercially available “off the shelf” software, and (y) ComputerSoftware that MM or any of its subsidiaries or the Contributed Assets receives as “free software”, “open sourcesoftware” or under a similar licensing or distribution model). Section 4.17(a)(iii) of the MM Disclosure Letter identifieswhich Computer Software is owned, licensed, leased or otherwise used in the business of MM or any of its subsidiaries or with respectto the Contributed Assets, as the case may be. Section 4.17(a)(iv) of the MM Disclosure Letter lists all Computer Softwareand service offerings that MM or any of its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates,have licensed, sold, distributed or provided to third parties in the five (5) years prior to the date hereof, or that MM or anyof its subsidiaries or, with respect to the Contributed Assets only, any of its Affiliates, is obligated to provide maintenanceor support thereunder (collectively, “MM Products”). Neither MM nor any of its subsidiaries or, with respectto the Contributed Assets only, any of its Affiliates, own any patents or patent applications.

 

(b)   Section 4.17(b)(i)of the MM Disclosure Letter lists any License Agreements and Contracts under which MM or any of its subsidiaries has granted anythird party rights that are exclusive, or exclusive of all other third parties, to use, sublicense, resell or distribute any MMIntellectual Property Right. Section 4.17(b)(ii) of the MM Disclosure Letter lists any License Agreements and Contractsunder which (x) MM or any of its subsidiaries has deposited or is obligated to deposit source code or other proprietary materialsin escrow for the benefit of a third party, or (y) a third party is or under any circumstances may be entitled to receive sourcecode directly from MM or any of its subsidiaries or from escrow.

 

 

 

(c)   Neither MM nor any of itssubsidiaries are a party to any License Agreements, forbearances to sue, consents, judgments, orders or similar obligations thatrestrict the rights of MM, any of its subsidiaries or the Contributed Assets to use or enforce any MM Intellectual Property Rights.

 

(d)   MM, its subsidiaries, orwith respect to the Contributed Assets only, its Affiliates, as applicable, own all right, title, and interest, free and clearof all security interests and similar encumbrances, in and to all MM Intellectual Property Rights. Except as listed in Section4.17(d) of the MM Disclosure Letter, MM or one of its Affiliates, as applicable, are listed in the records of the appropriateUnited States, state or foreign agency as the sole owner for each MM Registered Intellectual Property Right.

 

(e)   To the Knowledge of MM,MM’s and its subsidiaries’ Licensed Intellectual Property Rights and the MM Intellectual Property Rights together constituteall the Intellectual Property Rights necessary to conduct the business of MM, its subsidiaries and the Contributed Assets as currentlyconducted. To MM’s Knowledge, the conduct of the business of MM, its subsidiaries and the Contributed Assets as such businessis currently conducted, including the design, development, marketing and sale of the MM Products and services: (A) does not infringe,misappropriate or otherwise violate the Intellectual Property Rights of any third party; and (B) does not constitute unfair competitionor unfair trade practices under the Laws in the United States.

 

(f)   None of MM, any of itssubsidiaries, or with respect to the Contributed Assets only, its Affiliates, has received any written, or, to the Knowledge ofMM, oral communications from any third party claiming that the operation of the business of MM, any of its subsidiaries or theContributed Assets or any act of MM, any of its subsidiaries or, with respect to the Contributed Assets only, its Affiliates, orMM Product or service or the use of any MM Product or service infringes, misappropriates or otherwise violates the IntellectualProperty Rights of any third party or constitute unfair competition or unfair trade practices under the Laws of any jurisdiction.Neither MM nor any of its subsidiaries or, with respect to the Contributed Assets only, its Affiliates, has received any writtencommunication from a third party pursuant to which the third party offered any of them a license to use any technology or IntellectualProperty Rights in order to avoid a claim of infringement or misappropriation.

 

(g)   Neither MM nor any of itssubsidiaries has received written notice of, and to the Knowledge of MM, there is no pending or threatened Legal Action by a thirdparty before any Governmental Entity in any jurisdiction challenging the ownership, use, validity, enforceability or registrabilityof any MM Intellectual Property Rights. To the Knowledge of MM, there is no pending or threatened Legal Action relating to thebusiness of MM, its subsidiaries or the Contributed Assets before any Governmental Entity in any jurisdiction: challenging theownership, use, validity, enforceability, or registrability of any of MM’s or its subsidiaries’ Licensed IntellectualProperty Rights or the rights of MM or any of its subsidiaries to use or exploit any of MM’s or its subsidiaries’ LicensedIntellectual Property Rights, in each case, other than as would not be reasonably expected to result in a MM Material Adverse Effect.

 

(h)   To the Knowledge of MM,no Person has infringed, misappropriated, or otherwise violated, or is infringing, misappropriating, or otherwise violating, anyMM Intellectual Property Rights. Neither MM nor any of its Affiliates has brought any Legal Action against any third party alleginginfringement, misappropriation or violation of MM Intellectual Property Rights that remain unresolved. MM and its Affiliates, asapplicable, have the sole and exclusive right to bring a Legal Action against a third party for infringement or violation of theMM Intellectual Property Rights.

 

(i)   To the Knowledge of MM,the MM Intellectual Property Rights are subsisting, in full force and effect, have not been cancelled or abandoned, have not expired,and, with respect to the MM Registered Intellectual Property Rights only, are valid and enforceable. To the Knowledge of MM, neitherMM nor any of its Affiliates nor any of their respective officers, employees or agents have knowingly done, or failed to do, anyact or thing which may, after the Effective Time, materially prejudice the validity or enforceability of any of the MM IntellectualProperty Rights or MM’s and its subsidiaries’ Licensed Intellectual Property Rights. All necessary registration, maintenanceand renewal fees in connection with any MM Registered Intellectual Property Rights have been paid and all necessary documents,recordations and certificates in connection with such MM Registered Intellectual Property Rights have been filed with the relevantpatent, copyright, trademark or other authorities in the United States or foreign jurisdictions, as the case may be, for the purposesof maintaining such MM Registered Intellectual Property Rights.

 

 

 

(j)   There are no actions thatmust be taken by MM or any of its subsidiaries within 120 days of the Effective Time, including the payment of any registration,maintenance or renewal fees or the filing of any responses to office actions by the patent, copyright, trademark or other authoritiesin the United States or foreign jurisdictions, documents, applications or certificates for the purposes of obtaining, maintaining,perfecting or preserving or renewing any MM Registered Intellectual Property Rights.

 

(k)   MM and its Affiliates havemade commercially reasonable efforts to protect their respective trade secrets and preserve their status as intellectual propertyunder applicable Law. MM, its subsidiaries and, with respect to the Contributed Assets only, its Affiliates, as applicable, havein place a policy requiring all employees, contractors and other parties having access to such trade secrets to execute a proprietaryinformation/confidentiality agreement.

 

(l)   Following the EffectiveTime, the Surviving Corporation will be permitted to exercise all of the rights of MM or its subsidiaries under such License Agreementsor Contracts to the same extent MM or its subsidiaries would have been able to had the transactions contemplated hereby, includingthe MM Reorganization, not occurred and without the payment of additional amounts or consideration other than ongoing fees, royalties,payments which MM or its subsidiaries would otherwise be required to pay. The consummation of the Merger and the transactions contemplatedhereby will not (i) result in the breach, modification, cancellation, termination, or suspension of any of MM’s or its subsidiaries’or the Contributed Assets’ License Agreements or any Contract with any customer of MM or any of its subsidiaries or the ContributedAssets, or give any Person (other than MM or any of its subsidiaries) or a party to any of MM’s or its subsidiaries’or the Contributed Assets’ License Agreements or any Contract with any customer of MM or any of its subsidiaries or the ContributedAssets the right to do any of the foregoing, (ii) give rise to a right by any third party to obtain, directly from MM or any ofits subsidiaries or from escrow, source code for Computer Software or other proprietary materials of MM or any of its subsidiariesor the Contributed Assets, (iii) result in the loss or impairment of MM’s or its subsidiaries’ or the Contributed Assets’ownership of or right to use MM Intellectual Property Rights or Licensed Intellectual Property Rights, or (iv) cause SurvivingCorporation or any of its Affiliates (x) to be bound by any non-compete or other restriction on the operation of any business or(y) to grant any rights or licenses to any Intellectual Property Rights of the Surviving Corporation or any of its Affiliates toa third party (including, without limitation, a covenant not to sue).

 

(m)   To MM’s Knowledge,since March 31, 2013, MM and its Affiliates have complied in all material respects with all applicable Laws and regulationsrelating to privacy, data protection and the collection and use of personally identifiable information gathered or accessed inthe course of the operations of MM, its subsidiaries and the Contributed Assets. To the Knowledge of MM, MM and its Affiliateshave at all times complied in all material respects with all rules, policies and procedures established by MM or any of its Affiliates,as applicable, from time to time with respect to the foregoing, if any. To MM’s Knowledge, no claims are pending or threatenedor likely to be asserted against MM or any of its Affiliates by any Person alleging a violation of such Person’s privacy,personal or confidentiality rights under any such Laws, regulations, rules, policies or procedures. To MM’s Knowledge, theconsummation of the Merger and the transactions contemplated hereby will not breach or otherwise cause any violation of any suchLaws, regulations, rules, policies or procedures.

 

(n)   With respect to sensitivepersonally identifiable information, to MM’s Knowledge, MM, its subsidiaries and, with respect to the Contributed Assetsonly, its Affiliates have taken all commercially reasonable steps (including, without limitation, implementing and monitoring compliancewith adequate measures with respect to technical and physical security) to ensure that such information is protected against lossand against unauthorized access, use, modification, disclosure or other misuse. To the Knowledge of MM, there has been no unauthorizedaccess to or other misuse of that information.

 

4.18.   Material Agreements.   Section4.18 of the MM Disclosure Letter sets forth a list of all MM Material Agreements. All of the MM Material Agreements are infull force and effect and constitute the valid, legal and binding obligation of MM or its Affiliates, as applicable, and constitutethe valid, legal and binding obligation of the other parties thereof, enforceable against each such Person in accordance with itsterms, subject to (i) the effect of bankruptcy, fraudulent conveyance, reorganization, moratorium and other similar laws relatingto or affecting the enforcement of creditor’s rights generally, and (ii) general equitable

 

 

 

principles (whether considered in a proceeding in equity or at law).There are no material breaches or defaults by MM or any of its Affiliates under any of the MM Material Agreements or, to the Knowledgeof MM, events which with notice or the passage of time would constitute a material breach or default by MM or any of its Affiliates,and neither MM nor any of its Affiliates have received written notice of any such material breach or default from any other partyunder any of the MM Material Agreements. MM has made available to the Company true and complete copies of all MM Material Agreements,including all amendments thereto.

 

4.19.   Customers and Suppliers.   MMhas delivered to the Company a list identifying each customer of MM, its subsidiaries and, with respect to the Contributed Assetsonly, its Affiliates, from which, for the twelve (12) month period ended March 31, 2014 and the eight month period ended November 30,2014, MM, its subsidiaries and, with respect to the Contributed Assets only, its Affiliates received revenue (on a consolidatedbasis) in excess of  $4,000,000 for such year or period, as applicable (collectively, “MM Major Customers”).Section 4.19 of the MM Disclosure Letter sets forth the names of the five (5) largest suppliers (by consolidated expenditure)to MM, its subsidiaries and the Contributed Assets for the twelve (12) month period ended March 31, 2014 and the eight monthperiod ended November 30, 2014. Within the preceding twelve (12) months, neither MM nor any of its Affiliates has receivedwritten or, to the Knowledge of MM, oral notice that any MM Major Customer or supplier listed in Section 4.19 of the MMDisclosure Letter has: (i) threatened to cancel, suspend or otherwise terminate, or intends to cancel, suspend or otherwise terminate,any relationships of such Person with MM or any of its subsidiaries or the Contributed Assets, (ii) decreased materially or threatenedto stop, decrease or limit materially, or intends to modify materially its relationships with MM or any of its subsidiaries orthe Contributed Assets, or (iii) intends to refuse to pay any amount due to MM or any of its subsidiaries or the Contributed Assetsor seek to exercise any remedy against MM or any of its subsidiaries or the Contributed Assets. Neither MM or any of its subsidiariesor, with respect to the Contributed Assets only, any of its Affiliates, within the past twelve (12) months have been engagedin any material dispute with any MM Major Customer or supplier listed in Section 4.19 of the MM Disclosure Letter. MM, itssubsidiaries and, with respect to the Contributed Assets only, its Affiliates are in compliance in all material respects with theinsurance requirements set forth in its agreements with each of its customers.

 

4.20.   Agreements with RegulatoryAgencies.   Neither MM nor any of its subsidiaries (a) is subject to any cease-and-desist or other Order issuedby, (b) is not a party to any Contract, consent agreement or memorandum of understanding with, (c) is not a party to any commitmentletter or similar undertaking to, (d) is not subject to any order or directive by, (e) is not a recipient of any extraordinarysupervisory letter from, and (f) has not adopted any board resolutions at the request of any Governmental Entity that restrictsthe conduct of its business or that in any manner relates to its management or its business, or would reasonably be expected, followingthe Merger and the consummation of the transactions contemplated hereby, to impair in any material respect the Surviving Corporation’sability to conduct the business of MM and its subsidiaries and the Contributed Assets after the Effective Time, as presently conducted.Neither MM nor any of its subsidiaries have been advised by any Governmental Entity that such Governmental Entity is consideringissuing or requesting any Regulatory Agreement, except for any such proposed Regulatory Agreements that, individually or in theaggregate, would not reasonably be expected to result in a MM Material Adverse Effect.

 

4.21.   Accounts Receivable.   Theaccounts receivable of MM, its subsidiaries and, with respect to the Contributed Assets only, its Affiliates represent or willrepresent valid, bona fide claims against debtors for sales or other charges arising from sales actually made or services actuallyperformed by MM or any of its Affiliates in the ordinary course of business and in conformity in all material respects with theapplicable purchase orders, agreements and specifications, and such accounts receivable are not subject to any defenses, set-offsor counterclaims. MM and its Affiliates have performed in all material respects all obligations with respect to such accounts receivablewhich it was obligated to perform through the Effective Time.

 

4.22.   Insurance.   Allcasualty, general liability, business interruption, product liability, director & officer liability, worker’s compensation,environmental, automobile and sprinkler and water damage and other insurance policies and bond and surety arrangements maintainedby MM, any of its subsidiaries or, with respect to the Contributed Assets only, its Affiliates are listed in Section 4.22of the MM Disclosure

 

 

 

Letter (the “MM Insurance Policies”) and trueand complete copies of the MM Insurance Policies have been made available to the Company. Neither MM nor any of its Affiliateshas received any written notice of cancellation of premium increase with respect to or alteration of coverage under any MM InsurancePolicy since January 1, 2014. Neither MM nor its Affiliates have received any written notice that any carrier under such MMInsurance Policies is financially insolvent. There are no claims related to the business of MM, its subsidiaries or the ContributedAssets pending under any MM Insurance Policy as to which coverage has been questioned, denied or disputed or in respect of whichthere is an outstanding reservation of rights. Neither MM nor its Affiliates are in default under, or has otherwise failed to complywith, in any material respect, any provision contained in any MM Insurance Policy. Since January 1, 2011, any claims underany MM Insurance Policy have been reported to carriers in a timely manner. All such MM Insurance Policies (x) are valid and bindingin accordance with their terms (y) to the Knowledge of MM, are provided by carriers who are financially solvent; and (z) have notbeen subject to any lapse in coverage. The MM Insurance Policies are of the type and in the amounts customarily carried by Personsconducting a business similar to MM, its subsidiaries and the Contributed Assets and are sufficient for compliance, in all materialrespects, with all applicable Laws and Contracts to which MM, its subsidiaries or the Contributed Assets are a party or by whichthey are bound.

 

4.23.   Board Approval.   TheBoard of Directors of MM has, as of the date hereof, unanimously (i) approved this Agreement and the transactions contemplatedhereby, subject to stockholder approval, (ii) determined that the Merger is fair to and in the best interests of the shareholdersof MM and (iii) recommended that the stockholders of MM approve and adopt the Agreement and approve the Merger.

 

4.24.   Vote Required.   Theaffirmative vote of the holders of the outstanding shares of MM Stock in accordance with the CGCL and MM’s Articles of Incorporationand Bylaws (the “MM Stockholders’ Approval”) is the only vote of the holders of any class or series ofMM’s capital stock necessary to approve and adopt this Agreement and approve the Merger and the transactions contemplatedhereby. MM has obtained the MM Stockholders’ Approval.

 

4.25.   Financial Statements.

 

(a) Complete copies of the audited or unaudited(to the extent no audited financial statements exist as of the date of this Agreement) financial statements of MM and its subsidiariesconsisting of the balance sheet of MM and each such subsidiary as at March 31, 2014, March 31, 2013 and June 30,2012 and the related statements of income and retained earnings, stockholders’ equity and cash flow for the years then ended,and unaudited financial statements consisting of the balance sheet of MM and its subsidiaries as at September 30, 2014 andthe related statements of income and retained earnings, stockholders’ equity and cash flow for the six month period thenended (the “MM Financial Statements”) have been provided to the Company. The audited and unaudited financialstatements included in the MM Financial Statements were prepared in accordance with Indian generally accepted accounting principles,applied on a consistent basis during the periods involved (except as may be indicated therein in the notes thereto), and fairlypresent (subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments (which are notexpected to be, individually or in the aggregate, materially adverse to MM and its subsidiaries taken as a whole) and the absenceof complete footnotes)), in all material respects, the financial position of MM and its subsidiaries as at the respective datesthereof and the results of their operations and cash flows for the respective periods then ended, and were compiled from, and areconsistent with, the books and records of MM and its subsidiaries, which books and records are accurate and complete in all materialrespects.

 

(b) The audited and unaudited financial statementsof MM and its subsidiaries (including financials related to the Contributed Assets) to be included in the Proxy Statement and theRegistration Statement (the “MM US GAAP Financials”) will have been prepared in accordance with GAAP, appliedon a consistent basis during the periods involved (except as may be indicated therein in the notes thereto), and fairly present(subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments (which are not expectedto be, individually or in the aggregate, materially adverse to MM, its subsidiaries and the Contributed Assets taken as a whole)and the absence of complete footnotes)), in all material respects, the financial position of MM, its subsidiaries and the ContributedAssets as at the

 

 

 

respective dates thereof and the results of their operations andcash flows for the respective periods then ended and will have been compiled from, and be consistent with, the books and recordsof MM, its subsidiaries and the Contributed Assets, which books and records will be accurate and complete in all material respects.

 

4.26.   MM Reorganization.   

 

(a) Set forth in Section 4.26 of theMM Disclosure Letter is a complete and accurate description of the MM Reorganization, including: (i) the identity of all partiesthereto; (ii) all Approvals necessary in order to consummate the MM Reorganization, as well as the expected timing of the receiptof such Approvals; (iii) all Contracts entered into by MM and its subsidiaries in connection with the MM Reorganization (the “MMReorg Contracts”) and (iv) a list of all shareholders, members or other equity interest holders of MM and each of itssubsidiaries.

 

(b) The execution and delivery of the MM ReorgContracts by MM or any subsidiaries does not, and the performance of the MM Reorg Contracts by MM or any of its subsidiaries willnot, (i) conflict with or violate the Articles of Incorporation or Bylaws or equivalent organizational documents of MM or any ofits subsidiaries, (ii) subject to obtaining the consents, approvals, authorizations and permits and making the registrations, filingsand notifications set forth in Section 4.26 of the MM Disclosure Letter, conflict with or violate any Law applicable toMM or any of its subsidiaries or by which either or any of their respective properties is bound or affected, (iii) result in anybreach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or impairMM’s or any of its subsidiaries’ rights or alter the rights or obligations of any third party under, or give to othersany rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the propertiesor assets of MM or any of its subsidiaries pursuant to, any MM Material Agreement, or (iv) cause the acceleration of any vestingof any awards for or rights to MM Stock or the payment of or the acceleration of payment of any change in control, severance, bonusor other cash payments or issuance of MM Stock.

 

4.27.   Related Party Transactions.   Exceptas otherwise set forth in Section 4.27 of the MM Disclosure Letter and other than in respect of Contracts or interests relatedto employment or incentive arrangements in the ordinary course of business, no executive officer or director of MM or any of itssubsidiaries or any Person owning 5% or more of the shares of Surviving Corporation Common Stock (or any of such Person’simmediate family members or Affiliates or associates) is a party to any Contract with or binding upon MM or any of its subsidiariesor any of their respective assets, rights or properties or has any interest in any property owned by or has engaged in any transactionwith any of the foregoing within the last twelve (12) months.

 

4.28.   Brokers.   NeitherMM nor any of its subsidiaries have incurred, nor will they incur, directly or indirectly, any Liability for brokerage or finder’sfees or agent’s commissions or any similar charges in connection with this Agreement or any transaction contemplated hereby.

 

**ArticleV******

**COVENANTS**

** **

5.1.   Covenants of MM andthe Company.   At all times from and after the date hereof until the Effective Time, each of MM and the Companycovenant and agree as to themselves and their respective subsidiaries that (except as necessary to effectuate the MM Reorganizationand the Merger and otherwise as expressly contemplated or permitted by this Agreement, or to the extent that the other party shallotherwise previously consent in writing, which such consent shall not be unreasonably withheld, conditioned or delayed):

 

(a) Ordinary Course.   Eachparty and their respective subsidiaries shall conduct their respective businesses only in, and none of the parties and their respectivesubsidiaries shall take any action except in, the ordinary course consistent with past practice.

 

(b) Negative Covenants.   Withoutlimiting the generality of Section 5.1(a), (i) each party and its subsidiaries shall use all commercially reasonable effortsto preserve intact in all material respects their respective present business organizations and reputation, to keep available theservices of their key officers

 

 

 

and employees, to maintain their assets and properties in good workingorder and condition, ordinary wear and tear excepted, to maintain insurance on their tangible personal property and businessesin such amounts and against such risks and losses as are currently in effect, to preserve their relationships with customers andsuppliers and others having significant business dealings with them and to comply in all material respects with all Laws and Ordersof all Governmental Entities, and (ii) except as necessary to effectuate the Merger and the MM Reorganization, neither party, northeir subsidiaries, shall, except as otherwise expressly provided for in this Agreement or as set forth in Section 5.1(b)of the MM Disclosure Letter:

 

(i)   amend or propose to amendtheir organizational documents;

 

(ii)   (w) declare, set asideor pay any dividends on or make other distributions in respect of any of its capital stock, (x) split, combine, reclassify or takesimilar action with respect to any of its capital stock or issue or authorize or propose the issuance of any other securities inrespect of, in lieu of or in substitution for shares of its capital stock, (y) adopt a plan of complete or partial liquidationor resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalizationor other reorganization or (z) directly or indirectly redeem, repurchase or otherwise acquire any shares of its capital stock orany options with respect thereto;

 

(iii)   issue, deliver or sell,or authorize or propose the issuance, delivery or sale of, any shares of its capital stock or any options or other equity incentiveswith respect thereto (other than issuances pursuant to options or warrants outstanding on the date hereof and in accordance withtheir present terms);

 

(iv)   acquire (by merging orconsolidating with, or by purchasing a substantial equity interest in or a substantial portion of the assets of, or by any othermanner) any business or any other Person or otherwise acquire or agree to acquire any material assets, except, with respect toMM, for acquisitions for a total consideration not exceeding $10 million;

 

(v)   other than in the ordinarycourse of business consistent with past practice****and of assets which are not, individually or in the aggregate, materialto their business, sell, lease, transfer, license, pledge, grant any security interest in or otherwise dispose of or encumber anyof its material assets or properties;

 

(vi)   except to the extentrequired by applicable Law, GAAP or Contracts existing on the date hereof, permit any material change in (A) any pricing, marketing,purchasing, investment, accounting, financial reporting, inventory, credit, allowance or Tax practice or policy or (B) any methodof calculating any bad debt, contingency or other reserve for accounting, financial reporting or Tax purposes;

 

(vii)   except to the extentrequired by applicable Law or Contracts existing on the date hereof, make any material Tax election or settle or compromise anymaterial Tax Liability with any Governmental Entity;

 

(viii)   (x) incur any indebtednessfor borrowed money, or guarantee any such indebtedness, in each case, other than in the ordinary course of business consistentwith past practice and other than indebtedness incurred by MM for acquisition financing in an amount not exceeding $10 million,or (y) voluntarily purchase, cancel, prepay or otherwise provide for a complete or partial discharge in advance of a scheduledrepayment date with respect to, or waive any right under, any indebtedness for borrowed money in excess of  $500,000, ineach case, other than in the ordinary course of its business consistent with past practice;

 

(ix)   enter into, adopt, amendin any material respect (except as may be required by applicable Law) or terminate any Company Plan or MM Benefit Plan, or****increasein any manner the compensation or fringe benefits of any director, officer or employee or pay any benefit not required by any CompanyPlan or MM Benefit Plan in effect as of the date hereof, except for annual salary increases in the ordinary course of businessconsistent with past practices;

 

(x)   enter into any MM MaterialAgreement or Company Material Agreement, as applicable, or amend, modify or otherwise terminate any existing MM Material Agreementor Company Material Agreement, as applicable;

 

 

 

(xi)   make any capital expendituresor commitments for additions to property or equipment constituting capital assets in an aggregate amount exceeding $1 million forMM or $250,000 for the Company;

 

(xii)   make any material changein the lines of business in which it participates or is engaged;

 

(xiii)   institute, settle orcompromise any Legal Actions pending or threatened before any arbitrator, court or other Governmental Entity involving the paymentof monetary damages of any amount exceeding $250,000 in the aggregate; providedthat neither party nor their subsidiariesshall settle or agree to settle any Legal Action which settlement involves a conduct remedy or injunctive or similar relief orhas a restrictive impact on their respective business; or

 

(xiv)   enter into any Contract,commitment or arrangement to do or engage in any of the foregoing.

 

MM covenants that, pending consummation ofthe MM Reorganization, it shall cause its Affiliates to comply with the covenants in this Section 5.1 with respect to theContributed Assets.

 

Nothing contained in this Agreement shall giveto any party or its subsidiaries, directly or indirectly, rights to control or direct the operation of the other party or suchother party’s subsidiaries prior to the Closing Date. Prior to the Closing Date, each party shall exercise, and shall causeits subsidiaries to exercise, consistent with the terms and conditions of this Agreement, complete control and supervision of itsown operations.

 

(c)   Advice of Changes.   Eachparty shall promptly advise the other, orally and in writing, of any change or event, including, without limitation, any complaint,investigation or hearing by any Governmental Entity (or communication indicating the same may be contemplated) or the institutionor threat of Legal Action, having, or which, insofar as can be reasonably foreseen, could have, a Company Material Adverse Effector a MM Material Adverse Effect, as applicable; provided that no party shall be required to make any disclosure to the extentsuch disclosure would constitute a violation of any applicable Law. No notice given pursuant to this Section 5.1(c) shallhave any effect on the representations, warranties, covenants or agreements contained in this Agreement for purposes of determiningsatisfaction of any condition contained herein.

 

(d)   Notice and Cure.   Eachof MM and the Company will notify the other of, and will use all commercially reasonable efforts to cure before the Closing, anyevent, transaction or circumstance, as soon as practical after it becomes known to such party, that causes or will cause any covenantor agreement of such party under this Agreement to be breached in any material respect or that renders or will render untrue anyrepresentation or warranty of such party contained in this Agreement in any material respect. Each of MM and the Company also willnotify the other in writing of, and will use all commercially reasonable efforts to cure, before the Closing, any material violationor breach, as soon as practical after it becomes known to such party, of any representation, warranty, covenant or agreement madeby such party. No notice given pursuant to this paragraph shall have any effect on the representations, warranties, covenants oragreements contained in this Agreement for purposes of determining satisfaction of any condition contained herein.

 

(e)   Fulfillment of Conditions.   Subjectto the terms and conditions of this Agreement, each of MM and the Company will take or cause to be taken all commercially reasonablesteps necessary or desirable and proceed diligently and in good faith to satisfy each condition to the other’s obligationscontained in this Agreement and to consummate and make effective the transactions contemplated hereby, and neither MM nor the Companywill, nor will it permit any of its subsidiaries to, take or fail to take any action that could be reasonably expected to resultin the nonfulfillment of any such condition.

 

5.2.   No Solicitations.   

 

(a)   The Company shall not,and shall cause the Subsidiary not to, and shall not authorize and shall use its commercially reasonable efforts to cause its andthe Subsidiary’s Representatives not to, directly or indirectly, solicit, initiate or knowingly take any action to facilitateor encourage the submission of any Takeover Proposal or the making of any proposal that could reasonably be expected to lead toany Takeover Proposal, or, subject to Section 5.2(b), (i) encourage, solicit, initiate, induce, conduct, engage or participate

 

 

 

in, any discussions or negotiations with, disclose any non-publicinformation relating to the Company or any Subsidiary to, afford access to the business, properties, assets, books or records ofthe Company or the Subsidiary to, or knowingly assist, participate in, facilitate or encourage any effort by, any third party thatis seeking to make, or has made, any Takeover Proposal, (ii) (A) amend or grant any waiver or release under any standstill or similaragreement with respect to any class of equity securities of the Company or the Subsidiary or (B) approve any transaction under,or any third party becoming an “interested stockholder” under, Section 203 of the DGCL (other than MM), (iii) enterinto any binding or non-binding agreement in principle, letter of intent, term sheet, acquisition agreement, merger agreement,option agreement, joint venture agreement, partnership agreement or other Contract relating to any Takeover Proposal (each, a “CompanyAcquisition Agreement”), or (iv) grant approval pursuant to any “moratorium”, “control share acquisition”,“business combination”, “fair price”, or other form of anti-takeover law, including Section 203 of theDGCL to any Person (other than MM). Subject to Section 5.2(b), neither the Company Board nor any committee thereof shall(i) fail to make, withdraw, amend, modify or materially qualify, in a manner adverse to MM, the Company Board Recommendation, (ii)recommend a Takeover Proposal, (iii) fail to recommend against acceptance of any tender offer or exchange offer for the sharesof Company Common Stock within ten (10) Business Days after the commencement of such offer, (iv) make any public statement inconsistentwith the Company Board Recommendation, or (v) resolve or agree to take any of the foregoing actions (any of the foregoing, a “CompanyAdverse Recommendation Change”). The Company shall, and shall cause the Subsidiary to, cease immediately and cause tobe terminated, and shall not authorize, and shall use commercially reasonable efforts not to permit, any of its or their Representativesto continue, any and all existing activities, discussions or negotiations, if any, with any third party conducted prior to thedate hereof with respect to any Takeover Proposal and shall use its commercially reasonable efforts to cause any such third party(or its agents or advisors) in possession of non-public information in respect of the Company or the Subsidiary that was furnishedby or on behalf of the Company and the Subsidiary to return or destroy (and confirm destruction of) all such information.

 

(b)   Notwithstanding Section5.2(a), prior to the receipt of the Company Stockholders’ Approval, the Company Board, directly or indirectly throughany Representative, may, subject to Section 5.2(c) and Section 5.2(d), (i) participate in negotiations or discussionswith any third party from which the Company received an unsolicited Takeover Proposal that the Company Board believes in good faithcould constitute or result in a Superior Proposal, (ii) thereafter furnish to such third party (and any persons acting in concertwith such third party and to their respective financing sources and Representatives) non-public information relating to the Companyor the Subsidiary pursuant to an executed confidentiality agreement that constitutes an Acceptable Confidentiality Agreement (acopy of which confidentiality agreement shall be promptly (in all events within twenty-four (24) hours) provided for informationalpurposes only to MM), (iii) following receipt of and on account of a Superior Proposal, make a Company Adverse Recommendation Change,and/or (iv) take any action that any court of competent jurisdiction orders the Company to take (which order remains unstayed),but in each case referred to in the foregoing clauses (i) through (iv), only if the Company Board determines in good faith, afterconsultation with outside legal counsel, that the failure to take any such action could reasonably be expected to cause the CompanyBoard to be in breach of its fiduciary duties under applicable Law. Nothing contained herein shall prevent the Company Board fromdisclosing to the Company’s stockholders a position contemplated by Rule 14d-9 and Rule 14e-2(a) promulgated under the ExchangeAct with regard to a Takeover Proposal and the filing with the SEC of such disclosure pursuant to Rule 14d-9 and Rule 14e-2(a)shall not constitute a Company Adverse Recommendation Change in and of itself, if the Company determines, after consultation withoutside legal counsel, that failure to disclose such position would constitute a violation of applicable Law.

 

(c)   The Company Board shallnot take any of the actions referred to in clauses (i) through (iv) of Section 5.2(b) unless the Company shall have deliveredto MM a prior written notice advising MM that it intends to take such action. The Company shall notify MM promptly (but in no eventlater than twenty-four (24) hours) after it obtains knowledge of the receipt by the Company (or any of its Representatives) ofany Takeover Proposal, any inquiry that would reasonably be expected to lead to a Takeover Proposal, any request for non-publicinformation relating to the Company or the Subsidiary or for access to the business, properties, assets, books or records of theCompany or the Subsidiary by any third party. In such notice, the Company shall identify the third party making, and details ofthe material terms

 

 

and conditions of, any such Takeover Proposal, indication orrequest. The Company shall keep MM reasonably informed, on a reasonably current basis, of the status and of any material changeto the terms of any such Takeover Proposal, indication or request, including any material amendments or proposed amendments asto price and other material terms thereof. The Company shall promptly provide MM with a list of any non-public information concerningthe Company’s business, present or future performance, financial condition or results of operations, provided to any thirdparty, and, to the extent such information has not been previously provided to MM, copies of such information.

 

(d)   Except as set forthin this Section 5.2(d), the Company Board shall not make any Company Adverse Recommendation Change or enter into (or permitthe Subsidiary to enter into) a Company Acquisition Agreement. Notwithstanding the foregoing, at any time prior to the receiptof the Company Stockholders’ Approval, the Company Board may make a Company Adverse Recommendation Change or enter into (orpermit the Subsidiary to enter into) a Company Acquisition Agreement, if: (i) the Company promptly notifies MM, in writing, atleast five (5) Business Days (the “Notice Period”) before making such Company Adverse Recommendation Changeor entering into (or causing the Subsidiary to enter into) such Company Acquisition Agreement, of its intention to take such actionwith respect to a Superior Proposal, which notice shall state expressly that the Company has received a Takeover Proposal thatthe Company Board intends to declare a Superior Proposal and that the Company Board intends to make a Company Adverse RecommendationChange and/or the Company intends to enter into a Company Acquisition Agreement; (ii) the Company attaches to such notice the mostcurrent version of the proposed agreement for such Superior Proposal (which version shall be updated on a prompt basis) and theidentity of the third party making such Superior Proposal; (iii) the Company shall, and shall cause the Subsidiary to, and shalluse its commercially reasonable efforts to cause its and the Subsidiary’s Representatives to, during the Notice Period, negotiatewith MM in good faith to make such adjustments in the terms and conditions of this Agreement so that such Takeover Proposal ceasesto constitute a Superior Proposal, if MM, in its discretion, proposes to make such adjustments (it being agreed that in the eventthat, after commencement of the Notice Period, there is any material revision to the terms of a Superior Proposal, including, anyrevision in price, the Notice Period shall be extended, if applicable, to ensure that at least three (3) Business Days remainsin the Notice Period subsequent to the time the Company notifies MM of any such material revision (it being understood that theremay be multiple extensions)); and (iv) the Company Board determines in good faith, after consulting with outside legal counseland the Company Financial Advisor, that such Takeover Proposal continues to constitute a Superior Proposal after taking into accountany adjustments made by MM during the Notice Period in the terms and conditions of this Agreement.

 

5.3.   Third Party StandstillAgreements.   During the period from the date hereof through the Effective Time, except as contemplated by Sections5.2(b), (c) or (d), neither the Company nor the Subsidiary shall terminate, amend, modify or waive any provision of any confidentialityor standstill agreement to which it is a party. During such period, the Company shall enforce, to the fullest extent permittedunder applicable Law, the provisions of any such agreement, including, but not limited to, by obtaining injunctions to preventany breaches of such agreements and to enforce specifically the terms and provisions thereof in any court having jurisdiction.

 

5.4.   Takeover Statutes.   Ifany “fair price”, “moratorium”, “control share acquisition” or other form of antitakeover statuteor regulation shall become applicable to the transactions contemplated hereby, the Company and the members of the Company Boardand MM and the members of its Board of Directors shall grant such approvals and take such actions as are reasonably necessary sothat the transactions contemplated hereby may be consummated as promptly as practicable on the terms contemplated hereby and therebyand otherwise act to eliminate or minimize the effects of such statute or regulation on the transactions contemplated hereby andthereby.

 

5.5.   Access to Information;Confidentiality.

 

(a)   Each of the Companyand MM shall, and shall cause each of its subsidiaries to, throughout the period from the date hereof until the earlier of theEffective Time or the termination of this Agreement, (i) provide the other party and its Representatives with reasonable access,upon reasonable prior notice and during normal business hours, to all officers, employees, agents and accountants of the Companyor MM, as applicable, and its subsidiaries and their respective assets, properties, books and records, but only to the

 

 

extent that such access does not unreasonably interfere withthe business and operations of the Company or MM, as applicable, and its subsidiaries, and (ii) furnish promptly to such Personsall other information and data concerning the business and operations of the Company or MM, as applicable, and its subsidiariesas the other party or any of such other Persons reasonably may request. Neither party nor any of such party’s subsidiariesshall be required to provide access to or disclose information where such access or disclosure would: (A) jeopardize the protectionof the attorney-client privilege; (B) contravene any Law; or (C) contravene any confidentiality obligations in favor of athird party (it being agreed that the parties shall use their reasonable best efforts to cause such information to be providedin a manner that would not result in such jeopardy or contravention). No investigation pursuant to this paragraph or otherwiseshall affect any representation or warranty contained in this Agreement or any condition to the obligations of the parties hereto.Any such information or material obtained pursuant to this Section 5.5 that constitutes “Confidential Information”(as such term is defined in the Confidentiality Agreement) shall be governed by the terms of the Confidentiality Agreement.

 

(b)   Each party will hold,and will use its commercially reasonable efforts to cause its Representatives to hold, in strict confidence, unless (i) compelledto disclose by judicial or administrative process or by other requirements of applicable Laws (including, without limitation, inconnection with obtaining the necessary approvals of this Agreement or the transactions contemplated hereby by a Governmental Entity),or (ii) disclosed in an action or proceeding brought by a party hereto in pursuit of its rights or in the exercise of its remedieshereunder, all documents and information concerning the other party and its subsidiaries furnished to it by such other party orits Representatives in connection with this Agreement or the transactions contemplated hereby, except to the extent that such documentsor information can be shown to have been (x) previously known by the Company or MM, as applicable, or its Representatives or Affiliates,(y) in the public domain (either prior to or after the furnishing of such documents or information hereunder) through no faultof the Company or MM, as applicable, and its Representatives or Affiliates or (z) later acquired by the Company or MM, as applicable,or its Representatives or Affiliates from another source if the recipient is not aware that such source is under an obligationto the Company or MM, as applicable, or such party’s Affiliates to keep such documents and information confidential. In theevent that this Agreement is terminated without the transactions contemplated hereby having been consummated, upon the requestof the Company or MM, as the case may be, the other party will, and will cause its Representatives to, promptly redeliver or causeto be redelivered all copies of documents and information furnished by the Company or MM, as applicable, or its Representativesto such party and its Representatives in connection with this Agreement or the transactions contemplated hereby or destroy or causeto be destroyed all such documentation and information and all notes, memoranda, summaries, analyses, compilations and other writingsrelated thereto or based thereon prepared by the Company or MM, as applicable, or its Representatives or Affiliates.

 

5.6.   Preparation ofRegistration Statement and Proxy Statement, Charter Amendment.

 

(a)   The Company and MMshall prepare and file with the SEC as soon as reasonably practicable after the date hereof a single document constituting theProxy Statement and Registration Statement. The Company and MM shall use their respective commercially reasonable efforts to havethe Registration Statement declared effective by the SEC as promptly as practicable after such filing. If at any time prior tothe Effective Time any event shall occur that should be set forth in an amendment of or a supplement to the combined Proxy Statementand Registration Statement, the Company and MM shall prepare and the Company shall file with the SEC such amendment or supplementas soon thereafter as is reasonably practicable. No amendment or supplement to the combined Proxy Statement and Registration Statementwill be made without the approval of each party, which approval shall not be unreasonably withheld, conditioned or delayed; providedthat the Company, in connection with a Company Adverse Recommendation Change made in compliance with the terms hereof  (includingSection 5.2), may amend or supplement the Proxy Statement and Registration Statement pursuant to an amendment or supplementto the extent it contains (i) a Company Adverse Recommendation Change, (ii) a statement of the reason of the Company Board formaking such Company Adverse Recommendation Change, and (iii) additional information reasonably related to the foregoing. The Companyand MM shall cooperate with each other in the preparation of the combined Proxy Statement and Registration Statement and any amendmentor supplement thereto.

 

 

 

(b)   The Company and MMshall promptly notify the other and such other party’s counsel of the receipt of any comments or other communications, whetherwritten or oral, from the SEC or its staff with respect to the combined Proxy Statement and Registration Statement and of any requestsby the SEC or its staff for any amendment or supplement thereto or for additional information. The Company and MM shall promptlyprovide the other and such other party’s counsel with copies of all such comments or other communications between the SECand such party or any of it Representatives with respect to the combined Proxy Statement and Registration Statement. The Companyand MM shall provide the other a reasonable opportunity to participate in the response to those comments. Each of the Company andMM agrees to use its commercially reasonable efforts, after consultation with the other party hereto, to respond promptly to allsuch comments of, and requests by, the SEC and to cause (i) the Registration Statement to be declared effective by the SEC at theearliest practicable time and to be kept effective as long as is necessary to consummate the Merger, and (ii) the Proxy Statementto be mailed to the holders of Company Common Stock entitled to vote at the meeting of the stockholders of the Company at the earliestpracticable time.

 

(c)   The parties shall causethe combined Proxy Statement and Registration Statement to comply as to form and substance in all material respects with the applicablerequirements of  (i) the Exchange Act, including Sections 14(a) and 14(d) thereof and the respective regulations promulgatedthereunder, (ii) the Securities Act, (iii) the rules and regulations of the NYSE MKT and (iv) other applicable Laws, includingthe DGCL and the CGCL. All other documents that a party is responsible for filing with the SEC in connection with the transactionscontemplated hereby will comply as to form and substance in all material respects with the applicable requirements of the SecuritiesAct and the Exchange Act and all other applicable Laws.

 

(d)   If at any time priorto the Effective Time any event or circumstance relating to a party, or its officers or directors, is discovered that should beset forth in an amendment or a supplement to the combined Proxy Statement and Registration Statement so that such document wouldnot include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein inlight of the circumstances under which they were made, not misleading, such party shall promptly inform the other.

 

(e)   Each party will advisethe other, promptly after it receives notice thereof, of the time when the Registration Statement has become effective or any supplementor amendment has been filed, the issuance of any stop order, the qualification (or suspension) of the Surviving Corporation CommonStock issuable in connection with the Merger for offering or sale in any jurisdiction.

 

(f)   As soon as reasonablypracticable after the date hereof, MM will prepare for inclusion in the Proxy Statement and Registration Statement the MM US GAAPFinancials required to be included therein.

 

5.7.   Approval of Stockholders.   TheCompany shall, through the Company Board, duly call, give notice of, convene and hold a meeting of its stockholders (the “CompanyStockholders’ Meeting”) for the purpose of voting on the adoption and approval of this Agreement and the Mergeras soon as reasonably practicable after the date hereof. Subject to Section 5.2, the Company shall use its commerciallyreasonable efforts to solicit proxies from Company stockholders in order to obtain the Company Stockholders’ Approval. Exceptas provided in Section 5.2, the Company shall, through the Company Board, include in the Proxy Statement the Company BoardRecommendation. In the event that the Company Stockholders’ Approval is not obtained on the date on which the Company Stockholders’Meeting is initially convened, the Company Board shall have the right to adjourn such Company Stockholders’ Meeting on oneor more occasions solely for the purpose of soliciting proxies from the Company’s stockholders in order to obtain the CompanyStockholders’ Approval and, subject to Section 5.2, shall use its commercially reasonable efforts during any suchadjournments to obtain the Company Stockholders’ Approval. Notwithstanding anything contained herein to the contrary, theCompany shall not be required to hold the Company Stockholders’ Meeting if this Agreement is terminated before the meetingis held.

 

5.8.   Credit Agreement;Warrants.

 

(a)   From and after thedate this Agreement, the Company shall cause all amounts outstanding under the Credit Agreement to be repaid in full and all Indebtednessthereunder discharged and such Credit Agreement to be terminated, each, in form reasonably satisfactory to MM, in connection withthe consummation of the Merger and the other transactions contemplated hereby.

 

 

(b)   In connection therewith,the parties shall use commercially reasonable efforts to cause the cancellation of the Company Warrants immediately prior to theMerger including, if permitted under the Company Warrant, by sending to the holders of such Company Warrants a notice forcing theexercise thereof. Any Warrant that is not so canceled prior to the Effective Time shall be assumed in accordance with its termsby the Surviving Corporation. MM and the Company pay in equal share all reasonable fees and other costs paid to the holders ofall such Warrants for the cancellation of all such Warrants; provided, however, that no party shall settle with the holders ofthe Warrants without the consent of the other party hereto.

 

5.9.    Stock ExchangeListing.   MM shall use its commercially reasonable efforts to cause the shares of Surviving Corporation CommonStock to be issued in the Merger in accordance with this Agreement to be approved for listing on the NYSE****MKT, subject toofficial notice of issuance, prior to the Effective Time.

 

5.10.   Tax RepresentationLetters.   Officers of MM and the Company shall execute and deliver to Pepper Hamilton LLP, tax counsel forMM, and Sills Cummis & Gross P.C., tax counsel for the Company, tax representation letters, in each case, in form and substancereasonably acceptable to such counsel in order for them to issue the tax opinions referred to in Sections 6.2(h) and 6.3(f).Each of MM and the Company shall use its commercially reasonable efforts not to take or cause to be taken any action that wouldcause to be untrue (or fail to take or cause to take any action which would cause to be untrue) any of the facts or other informationset forth or referred to in the tax representation letters.

 

5.11.   Regulatory andOther Approvals; Further Assurances.

 

(a)   Subject to the termsand conditions of this Agreement, each of the Company and MM will proceed diligently and in good faith to, as promptly as practicable,(i) obtain all consents, approvals or actions of, make all filings (including any Form 8-K filings) with and give all notices toGovernmental Entities or any other public or private third parties required to consummate the Merger and the transactions contemplatedhereby, and (ii) provide such other information and communications to such Governmental Entities or other public or private thirdparties as the other party or such Governmental Entity or other public or private third parties may reasonably request in connectiontherewith. No party shall consent to any voluntary extension of any statutory deadline or delay the consummation of the Mergerat the request of a Governmental Entity without the consent of the other party, which consent shall not be unreasonably withheld,conditioned or delayed. All such filings and notices made by a party shall be provided for review and comment by the other partyand shall not be filed or made until reasonably acceptable to both parties.

 

(b)   Each party hereto will,either prior to or after the Effective Time, execute such further documents, instruments, deeds, bills of sale, assignments andassurances and take such further actions as may reasonably be requested by the other to consummate the Merger to vest the SurvivingCorporation with full title to all assets, properties, privileges, rights, approvals, immunities and franchises of either of theCompany or MM or to effect the other purposes of this Agreement.

 

5.12.   Equity-BasedAwards.

 

(a)   The terms of each Option,whether or not exercisable or vested, shall be adjusted as necessary to provide that, at the Effective Time, each Option outstandingimmediately prior to the Effective Time shall be replaced by and substituted for an option (each, an “Adjusted MM Option”)to acquire, on the same terms and conditions as were applicable under such Option immediately prior to the Effective Time, thenumber of shares of Surviving Corporation Common Stock equal to the product of  (i) the number of shares of Company CommonStock subject to such Option immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio, with any fractionalshares rounded down to the next lower whole number of shares. The exercise price per share of Surviving Corporation Common Stocksubject to any such Adjusted MM Option will be an amount equal to the quotient of  (A) the exercise price per share of CompanyCommon Stock subject to such Option immediately prior to the Effective Time divided by (B) the Exchange Ratio, with any fractionalcents rounded up to the next higher number of whole cents. Notwithstanding the foregoing, if the conversion of an Option in accordancewith the preceding provisions of this Section 5.12(a) would cause the related Adjusted MM Option to be treated as the grantof new stock right for purposes of Section 409A of the Code, such Option shall not be converted in accordance with the

 

 

preceding provisions but shall instead be converted in a mannerreasonably acceptable to the Surviving Corporation and the Company that would not cause the related Adjusted MM Option to be treatedas the grant of new stock right for purposes of Section 409A. For avoidance of doubt, each Adjusted MM Option shall be vested tothe same extent to which the Option for which it was substituted was vested before or as of the Effective Time.

 

(b)   The terms of each restrictedstock unit that is settleable in shares of Company Common Stock (a “Company RSU”) that is outstanding and unvestedimmediately prior to the Effective Time and does not fully vest by its terms as of the Effective Time (an “Unvested CompanyRSU”) shall be adjusted as necessary to provide that, at the Effective Time, each Unvested Company RSU outstanding immediatelyprior to the Effective Time shall be replaced by and substituted for a restricted stock unit (each, an “Adjusted MM RSU”)to acquire, on the same terms and conditions as were applicable under such Unvested Company RSU immediately prior to the EffectiveTime, the number of shares of Surviving Corporation Common Stock equal to the product of  (i) the number of shares of CompanyCommon Stock subject to such Unvested Company RSU immediately prior to the Effective Time multiplied by (ii) the Exchange Ratio,with any fractional shares rounded down to the next lower whole number of shares. For avoidance of doubt, each Adjusted MM RSUshall be vested to the same extent to which the Unvested Company RSU for which it was substituted was vested before or as of theEffective Time.

 

(c)   To the extent permittedunder Treas. Reg. Section 1.409A-3(j)(4) (if applicable), the holder of each Company RSU that is outstanding immediately priorto the Effective Time and becomes vested by its terms before or as of the Effective Time (it being understood that any such awardthat vests pursuant to its terms before or as of the Effective Time shall, for purposes of this Agreement, be deemed to be vestedimmediately prior to the Effective Time) (a “Vested Company RSU”) shall receive the number of shares of CompanyCommon Stock subject to such Vested Company RSU in accordance with the terms and conditions of such Vested Company RSU, includingany terms and conditions regarding any Taxes required by applicable Law to be withheld, if any, with respect to the vesting ofsuch Vested Company RSU.

 

(d)   The parties covenantto cause the Surviving Corporation to (x) take such actions as are necessary to establish a new omnibus equity award plan followingthe Effective Time and to prepare and file with the SEC a registration statement on an appropriate form, or a post-effective amendmentto a registration statement previously filed under the Securities Act, with respect to the awards and shares of Surviving CorporationCommon Stock subject to the Adjusted MM Options and Adjusted MM RSUs and other awards issued under such plan and, where applicable,(y) use its commercially reasonable efforts to have such registration statement declared effective as soon as practicable followingthe Effective Time and (z) use its commercially reasonable efforts to maintain the effectiveness of such registration statementcovering such Adjusted MM Options and Adjusted MM RSUs (and to maintain the current status of the prospectus contained therein)for so long as any Adjusted MM Option or any Adjusted MM RSU remains outstanding.

 

(e)   With respect to thoseindividuals, if any, who, subsequent to the Effective Time, will be subject to the reporting requirements under Section 16(a) ofthe Exchange Act, where applicable, the Surviving Corporation shall administer any Adjusted MM Option and any Adjusted MM RSU assumedpursuant to this Section 5.12 in a manner that complies with Rule 16b-3 promulgated under the Exchange Act to the extentsuch Adjusted MM Option or such Adjusted MM RSU complied with such rule prior to the Merger.

 

(f)   The Company and MMacknowledge and agree that the substitution of Options and Unvested Company RSUs for Adjusted MM Options and Adjusted MM RSUs,respectively, as provided in this Section 5.12 shall constitute the substitution of  “Plan Awards” (asdefined in the Company Option Plan) for equivalent awards of the Surviving Corporation for purposes of the Company Option Planand such Plan Awards.

 

5.13.    Directors’and Officers’ Indemnification and Insurance.

 

(a)   From and after theEffective Time and until the sixth anniversary of the Effective Time and for so long thereafter as any claim for indemnificationasserted on or prior to such date has not been fully adjudicated, the Surviving Corporation shall indemnify, defend and hold harmlesseach Person who is now,

 

 

or has been at any time prior to the date hereof or who becomesprior to the Effective Time, a director or officer of the Company or the Subsidiary (the “Indemnified Parties”)against all losses, claims, damages, costs and expenses (including reasonable attorneys’ fees), Liabilities, judgments, finesand settlement amounts that are paid or incurred in connection with any Legal Action (whether civil, criminal, administrative orinvestigative and whether asserted or claimed prior to, at or after the Effective Time) that is based directly or indirectly (inwhole or in part) on, or arises directly or indirectly (in whole or in part) out of, the fact that such Indemnified Party is orwas a director or officer of the Company or the Subsidiary and relates to or arises out of any action or omission occurring ator prior to the Effective Time (including in connection with this Agreement or any of the transactions contemplated hereby) (“IndemnifiedLiabilities”) to the fullest extent permissible under applicable Law; provided that the Surviving Corporationshall not be liable for any settlement of any claim effected without its prior written consent; and provided, further,that the Surviving Corporation shall not****be liable for any Indemnified Liabilities which occur as a result of fraud or theunlawful criminal actions, gross negligence or willful misconduct of any Indemnified Party. Without limiting the foregoing, inthe event that any such Legal Action is brought against any Indemnified Party (whether arising prior to or after the EffectiveTime), the Surviving Corporation will pay expenses in advance to each Indemnified Party or promptly reimburse each IndemnifiedParty for such expenses as such expenses are incurred to the fullest extent permitted by applicable Law; provided that thePerson to whom expenses are advanced provides any undertaking required by applicable Law to repay such advance if it is ultimatelydetermined in a final, non-appealable judgment of a court of competent jurisdiction that such Person is not entitled to indemnification.Any Indemnified Party wishing to claim indemnification under this Section 5.13, upon learning of any such Legal Action,shall notify the Surviving Corporation, but the failure so to notify the Surviving Corporation shall not relieve the SurvivingCorporation from any Liability which it may have under this paragraph except to the extent such failure prejudices the SurvivingCorporation. The Indemnified Parties as a group may retain only one law firm to represent them with respect to each such matterunless there is, under applicable standards of professional conduct, a conflict on any significant issue between the positionsof any two or more Indemnified Parties in which case, the Indemnified Parties may retain more than one law firm; provided,however, that the Surviving Corporation shall only be required to pay the reasonable fees and expenses of one law firm asdetermined by the Surviving Corporation, which law firm shall be reasonably satisfactory to the Surviving Corporation.

 

(b)   Except to the extentrequired by Law, from and after the Effective Time until the sixth anniversary of the Effective Time and for so long thereafteras any claim for indemnification asserted on or prior to such date has not been fully adjudicated, the Surviving Corporation willnot take any action so as to amend, modify or repeal the provisions for indemnification of directors or officers contained in itsArticles of Incorporation and Bylaws or other comparable charter documents of the Surviving Corporation and its subsidiaries (orsuch documents of any successor to the Surviving Corporation or any of its subsidiaries) in such a manner as would adversely affectthe rights of any individual who shall have served as a director or officer of the Company or the Subsidiary prior to the EffectiveTime to be indemnified by such corporations in respect of their serving in such capacities prior to the Effective Time.

 

(c)   The Company shallpurchase, at its own cost and expense, at the Effective Time, a six-year prepaid “tail policy” with coverage not lessthan the existing coverage and other terms, conditions, retentions and limits of liability that are at least as favorable as thosecontained in the applicable directors and officers insurance policy of the Company in effect as of the date hereof; providedthat the aggregate premium for such “tail policy” shall not exceed 300% of the amount per annum the Company paid inits last full fiscal year. In the event the Company elects to purchase such a “tail policy,” the Surviving Corporationshall maintain such “tail policy” in full force and effect and continue to honor the Company’s obligations thereunder.

 

(d)   If the Surviving Corporationor any of its successors or assigns (i) consolidates with or merges into any other Person and shall not be the continuing or survivingcorporation or entity of such consolidation or merger, or (ii) transfers or conveys all or substantially all of its propertiesand assets to any Person, the Surviving Corporation shall cause proper provision to be made so that the successors and assignsof the Surviving Corporation shall assume the applicable obligations of such party set forth in Section 5.13(c).

 

 

(e)   All rights to indemnification,advancement of expenses and exculpation by the Company or the Subsidiary now existing in favor of each Indemnified Party as providedin the respective certificates of incorporation, bylaws or other comparable charter documents of the Company or the Subsidiary,in each case as in effect on the date hereof, or pursuant to any other Contracts in effect on the date hereof, shall be assumedby the Surviving Corporation in the Merger, without further action, at the Effective Time and shall survive the Merger and shallremain in full force and effect in accordance with their terms, and, in the event that any proceeding is pending or asserted orany claim made during such period, until the final disposition of such proceeding or claim. The Surviving Corporation shall complywith and shall not amend without the consent of the other parties thereto, any indemnification Contracts of the Company or theSubsidiary with any of their respective current or former directors, officers or employees as in effect immediately prior to theEffective Time.

 

(f)   The provisions of thisSection 5.13 are intended to be for the benefit of, and shall be enforceable by, each Indemnified Party and each party entitledto insurance coverage under Section 5.13(c) above, respectively, and his or her heirs and legal representatives, and shallbe in addition to any other rights an Indemnified Party may have under the certificate or articles of incorporation, bylaws orother comparable charter documents of the Company, the Subsidiary, the Surviving Corporation or any of their respective subsidiaries,under applicable Law or otherwise or under any agreement of any Indemnified Party with the Company or any of its Subsidiaries.

 

5.14.    Expenses.   Exceptas otherwise specifically set forth elsewhere in this Agreement, whether or not the Merger is consummated, all costs and expensesincurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costor expense, except that out-of-pocket expenses incurred in connection with printing and mailing the Proxy Statement and the RegistrationStatement, as well as any filing and listing fees relating thereto (including any SEC filing fees and NYSE MKT listing fees) (the“Shared Expenses”) shall be shared by MM and the Company in accordance with the Sharing Ratio. The Company shallpay its portion of each Shared Expense in accordance with the Sharing Ratio at the Closing upon presentation of invoices evidencingsuch Shared Expenses.

 

5.15.    StockholderLitigation.   The Company shall promptly advise MM orally and in writing of any Legal Action brought by anystockholder of the Company against the Company and/or its directors relating to this Agreement or the transactions contemplatedhereby, including the Merger (each a “Company Transaction Legal Action”), and shall promptly inform MM of thestatus thereof. The Company shall give MM the opportunity to participate in, subject to a customary joint defense agreement, butnot control the defense or settlement of, any Company Transaction Legal Action and shall not settle any Company Transaction LegalAction without the prior written consent of MM (which consent shall not be unreasonably withheld, conditioned or delayed). Forthe avoidance of doubt, each party shall be solely responsible for all of its own costs, fees and expenses associated with allCompany Transactions Legal Actions. Following the Closing, all future costs, fees and expenses arising after the Effective Timein connection with such Company Transaction Legal Action shall be borne by the Surviving Corporation.

 

5.16.   Public Announcements.   Theinitial press release with respect to this Agreement and the transactions contemplated hereby shall be a release mutually agreedto by the Company and MM. Thereafter, the Company and MM agree that no public release or other public announcement, including anyreleases, announcements or other correspondence with customers or suppliers of either party, concerning the transactions contemplatedhereby shall be issued by any party without the prior written consent of the other party (which consent shall not be unreasonablywithheld, conditioned or delayed), except as such release or announcement may be required by applicable Law or the rules or regulationsof the SEC or a Governmental Entity to which the relevant party is subject, wherever situated, in which case the party requiredto make the release or announcement shall consult with the other party about, and allow the other party reasonable time to commenton, such release or announcement in advance of such issuance.

 

5.17.   Section 16 Matters.   Priorto the Effective Time, the Company shall take all such steps as may be required to cause to be exempt under Rule 16b-3 promulgatedunder the Exchange Act any dispositions of shares of Company Common Stock (including derivative securities with respect to suchshares) that are treated as dispositions under such rule and result from the transactions contemplated hereby by each directoror officer of the Company who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to theCompany.

 

 

5.18.   Delivery of FinancialStatements.   Within five (5) Business Days following the completion of the audited MM US GAAP Financials, MMshall deliver to the Company copies of the MM US GAAP Financials.

 

5.19.   Notice of CertainEvents.   From and after the date hereof until the earlier of the Effective Time or the termination of thisAgreement, the Company shall give prompt notice to MM, and MM shall give prompt notice to the Company, in writing of any event,transaction or circumstance that has caused or could reasonably be expected to cause any covenant or agreement of such party underthis Agreement to be breached or that has rendered or could be reasonably expected to render untrue any representation or warrantyof such party contained in this Agreement as if the same were made on or as of the date of such event, transaction or circumstance.No notice given pursuant to this Section 5.19 shall have any effect on the representations, warranties, covenants or agreementscontained in this Agreement for purposes of determining satisfaction of any conditions contained herein.

 

5.20.   MM Reorganization.   MMshall use its commercially reasonable efforts to, and to cause its Affiliates to, consummate the MM Reorganization.

 

5.21.   Ownership ofMM.   Except as described in Section 5.21 of the MM Disclosure Letter, MM shall use its best efforts to assurethat there is no, and shall cause its shareholders not to permit or suffer any, change in record or beneficial ownership of theMM Stock at any time prior to immediately before the Effective Time.

 

5.22.   Employee Matters;Employee Benefits.   The Surviving Corporation (and any successor thereto) shall, as of the Effective Time,employ all employees of the Company and the Subsidiary who are working for the Company or the Subsidiary as of the Effective Time(each, a “Continuing Employee”) with such employment to be on such terms and conditions as are acceptable tothe Surviving Corporation. Such Continuing Employees shall be given credit for all service with the Company and/or the Subsidiary(and credit for service credited by the Company and/or the Subsidiary), to the same extent as such service was credited for suchpurpose by the Company and/or the Subsidiary with respect to the Company Plans, under each comparable plan, arrangement or policymaintained by the Surviving Corporation and any successor thereto under which a Continuing Employee participates for purposes ofeligibility and vesting and benefit accrual (provided that such benefits shall not accrue and be double counted to the extent theyare also provided by any plan, arrangement or policy maintained by the Surviving Corporation) and for the purposes of calculatingthe amount of each Continuing Employee’s severance benefits, if any. Other than as set forth in the employment agreementreferred to in Section 6.2(g), nothing contained in this Agreement shall confer upon any Continuing Employee any continuingright with respect to employment by the Surviving Corporation or its Affiliates after the Effective Time, nor shall anything hereininterfere with the right of Surviving Corporation or its Affiliates to terminate the employment of any such Continuing Employeeat any time, with or without cause, or restrict the Surviving Corporation or its Affiliates in the exercise of their independentbusiness judgment in modifying any of the terms and conditions of the employment of any such Continuing Employee. No provisionof this Agreement be deemed to be the adoption of, or an amendment to, any employee benefit plan, as that term is defined in Section3(3) of ERISA, or otherwise to limit the right of the Surviving Corporation or any of its Affiliates to amend, modify or terminateany such employee benefit plan.

 

5.23.   Closing WorkingCapital.

 

(a)   At least fifteen (15)days prior to the Closing Date, each party shall prepare and deliver, or cause to be prepared and delivered, to the other partya certificate certified by its Chief Financial Officer setting forth a good faith estimate of such party’s Working Capitalas of the close of business on the day immediately prior to the Closing Date (the “WC Closing Certificate”).Such WC Closing Certificate shall set forth detailed calculations of such party’s Working Capital and be accompanied by reasonablesupporting documentation. The parties shall discuss in good faith their respective determinations and any disagreements relatedthereto in order to agree to final Working Capital amounts for each party promptly prior to the Closing Date. In connection therewith,each party shall afford the other reasonable access upon the terms and conditions set forth in Section 5.5 to its officers,employees, agents, accountants, assets, properties, books and records in order to resolve any disagreement and finalize the partiesrespective Working Capital amounts.

 

 

(b)   Following finalizationof each party’s Working Capital amount under Section 5.23(a) above, if MM’s Working Capital does not represent83.5% of the combined Working Capital amounts of MM and the Company as of the date of determination, MM shall take all necessaryactions to cause the MM Working Capital to represent 83.5% of the combined Working Capital amounts of MM and the Company as finalizedabove, including making cash infusions or cash dividends or other distributions, as the case may be. For the avoidance of doubt,the Exchange Ratio shall not be adjusted as a result of the provisions of this Section 5.23 or of any actions taken by MMpursuant to this Section 5.23.

 

5.24.   Accounting Adjustment.   Followingreceipt of the Company Stockholders’ Approval, completion of the MM Reorganization and obtaining confirmation from the NYSEMKT of the Exchange Listing and provided MM is not in breach or violation of the terms of this Agreement at such time, simultaneouslywith the consummation of the Merger, the Company will take a one-time charge (the “One-Time Charge”) to expense inits accounts for (x) the unamortized portion of the capitalized software amount and (y) the deferred tax assets, in each case,in its balance sheet in order to conform to certain accounting practices of the Surviving Corporation.

 

**ArticleVI**

**CONDITIONS**

** **

6.1.   Conditions toEach Party’s Obligation to Effect the Merger.   The respective obligation of each party to effect theMerger is subject to the fulfillment, at or prior to the Closing, of each of the following conditions:

 

(a)   Stockholder Approval.   TheCompany Stockholders’ Approval shall have been obtained.

 

(b)   Registration Statement;State Securities Laws.   The Registration Statement shall have become effective in accordance with the provisionsof the Securities Act, and no stop order suspending such effectiveness shall have been issued and remain in effect and no proceedingseeking such an order shall be pending or threatened. MM shall have received all state securities or “blue sky” permitsand other authorizations necessary to issue the Surviving Corporation Common Stock pursuant to this Agreement after the Merger.

 

(c)   Exchange Listing.   Theshares of Surviving Corporation Common Stock issuable to the Company’s stockholders in the Merger in accordance with thisAgreement shall have been authorized for listing on the NYSE****MKT (the “Exchange Listing”), subject toofficial notice of issuance.

 

(d)   MM Reorganization.   TheMM Reorganization shall have been completed and be effective.

 

(e)   Injunctions or Restraints.   Nocourt of competent jurisdiction or other competent Governmental Entity shall have enacted, issued, promulgated, enforced or enteredany Law or Order (whether temporary, preliminary or permanent) which is then in effect and has the effect of making illegal orotherwise restricting, preventing or prohibiting consummation of the Merger or the other transactions hereby and no such Law orOrder shall be pending.

 

6.2.   Conditions toObligation of MM to Effect the Merger.   The obligation of MM to effect the Merger is further subject to thefulfillment, at or prior to the Closing, of each of the following additional conditions (all or any of which may be waived in wholeor in part by MM in its sole discretion):

 

(a)   Representationsand Warranties.   The representations and warranties made by the Company in this Agreement shall be true andcorrect in all material respects (except that where any statement in a representation or warranty expressly includes a standardof materiality, such statement shall be true and correct in all respects) when made and as of the Closing Date as though made onand as of the Closing Date or, in the case of representations and warranties made as of a specified date earlier than the ClosingDate, on and as of such earlier date only. The Company shall have delivered to MM a certificate, dated the Closing Date and executedin the name and on behalf of the Company by its Chairman of the Board or President, to such effect.

 

(b)   Performance of Obligations.   TheCompany shall have performed and complied with, in all material respects, each agreement, covenant and obligation required by thisAgreement and all other Transaction Documents to which it is a party to be so performed or complied with by the Company at or priorto the Closing, and the Company shall have delivered to MM a certificate, dated the Closing Date and executed in the name and onbehalf of the Company by its Chairman of the Board or President, to such effect.

 

 

(c)   Governmental andRegulatory and Other Consents and Approvals.   Other than the filing of the Certificates of Merger and the CompanyStockholders’ Approval, all consents, approvals and actions of, filings with and notices to any Governmental Entity or anyother public or private third parties required of MM, the Company or any of their respective subsidiaries to consummate the Mergerand the transactions contemplated hereby, including those set forth in Section 6.2(c) of the Company Disclosure Letter shallhave been made or obtained, all in form and substance reasonably satisfactory to MM.

 

(d)   Proceedings.   Allproceedings to be taken on the part of the Company in connection with the transactions contemplated hereby and all documents incidentthereto shall be reasonably satisfactory in form and substance to MM, and MM shall have received copies of all such documents andother evidences as MM may reasonably request in order to establish the consummation of such transactions and the taking of allproceedings in connection therewith.

 

(e)   Company MaterialAdverse Effect.   Since the date hereof, there shall not have been any Company Material Adverse Effect or anyevent, change or effect that would, individually or in the aggregate, reasonably be expected to have a Company Material AdverseEffect.

 

(f)   Affidavit.   TheCompany shall have delivered a certificate (in form and substance acceptable to MM) pursuant to Section 1.1445-2(c)(3) of the U.S.Income Tax Regulations stating that the Company is not nor has it been a U.S. real property holding corporation (as defined insection 897(c)(2) of the Code) during the applicable period specified in section 897(c) of the Code.

 

(g)   Employment Agreement.   Mr.Shah shall remain the Company’s Chief Executive Officer immediately prior to the Effective Time and shall have entered intoan employment and restrictive covenant agreement in form and substance mutually acceptable to MM and Mr. Shah prior to the ClosingDate.

 

(h)   Tax Opinion.   MMshall have received the opinion of Pepper Hamilton LLP, counsel to MM, in form and substance reasonably satisfactory to MM, datedthe Closing Date, rendered on the basis of facts, representations and assumptions set forth or referred to in such opinion andthe certificates obtained from officers of MM and the Company, all of which are consistent with the state of facts existing asof the Effective Time, to the effect that (i) the Merger will qualify as a reorganization within the meaning of Section 368(a)of the Code and (ii) the Company and MM will each be a “party to the reorganization” within the meaning of Section368(b) of the Code, which opinion shall not have been withdrawn or modified in any material respect. In rendering the opinion describedin this Section 6.2(h), Pepper Hamilton LLP shall have received and may rely upon the tax representation letters referredto in Section 5.10 hereof.

 

6.3.   Conditions toObligation of the Company to Effect the Merger.   The obligation of the Company to effect the Merger is furthersubject to the fulfillment, at or prior to the Closing, of each of the following additional conditions (all or any of which maybe waived in whole or in part by the Company in its sole discretion):

 

(a)   Representationsand Warranties.   The representations and warranties made by MM in this Agreement shall be true and correctin all material respects (except that where any statement in a representation or warranty expressly includes a standard of materiality,such statement shall be true and correct in all respects) when made and as of the Closing Date as though made on and as of theClosing Date or, in the case of representations and warranties made as of a specified date earlier than the Closing Date, on andas of such earlier date only. MM shall have delivered to the Company a certificate, dated the Closing Date and executed in thename and on behalf of MM by its Chairman of the Board, President or any Vice President, to such effect.

 

(b)   Performance of Obligations.   MMshall have performed and complied with, in all material respects, each agreement, covenant and obligation required by this Agreementand all other Transaction Documents to which it is a party to be so performed or complied with by MM at or prior to the Closing,and MM shall have delivered to the Company a certificate, dated the Closing Date and executed in the name and on behalf of MM byits Chairman of the Board, Chief Executive Officer, President or any Vice President, to such effect.

 

(c)   Governmental andRegulatory and Other Consents and Approvals.   Other than the filing of the Certificates of Merger, all consents,approvals and actions of, filings with and notices to any Governmental Entity or any other public or private third parties requiredof MM, the Company or any of

 

 

their respective subsidiaries to consummate the Merger and thetransactions contemplated hereby, including those set forth in Section 6.3(c) of the MM Disclosure Letter shall have beenmade or obtained, all in form and substance reasonably satisfactory to the Company.

 

(d)   Proceedings.   Allproceedings to be taken on the part of MM in connection with the transactions contemplated hereby and all documents incident theretoshall be reasonably satisfactory in form and substance to the Company, and the Company shall have received copies of all such documentsand other evidences as the Company may reasonably request in order to establish the consummation of such transactions and the takingof all proceedings in connection therewith.

 

(e)   MM Material AdverseEffect.   Since the date hereof, there shall not have been any MM Material Adverse Effect or any event, changeor effect that would, individually or in the aggregate, reasonably be expected to have a MM Material Adverse Effect.

 

(f)   Tax Opinion.The Company shall have received the opinion of Sills Cummis & Gross P.C., counsel to the Company, in form and substance reasonablysatisfactory to the Company, dated the Closing Date, rendered on the basis of facts, representations and assumptions set forthor referred to in such opinion and the certificates obtained from officers of MM and the Company, all of which are consistent withthe state of facts existing as of the Effective Time, to the effect that (i) the Merger will qualify as a reorganization withinthe meaning of Section 368(a) of the Code and (ii) the Company and MM will each be a “party to the reorganization”within the meaning of Section 368(b) of the Code, which opinion shall not have been withdrawn or modified in any material respect.In rendering the opinion described in this Section 6.3(f), Sills Cummis & Gross P.C. shall have received and may relyupon the tax representation letters referred to in Section 5.10 hereof.

 

**ArticleVII**

**TERMINATION**

** **

7.1.   Termination.   ThisAgreement may be terminated, and the transactions contemplated hereby may be abandoned, at any time prior to the Effective Time,whether prior to or after the Company Stockholders’ Approval:

 

(a)   By mutual written agreementof the parties hereto duly authorized by action taken by or on behalf of their respective Boards of Directors;

 

(b)   By either the Companyor MM upon notification to the non-terminating party by the terminating party:

 

(i)   at any time afterJuly 30, 2015 if the Merger shall not have been consummated on or prior to such date and such failure to consummate the Mergeris not caused by a breach of this Agreement by the terminating party; provided, however, that if all of the conditionsto Closing shall have been satisfied or shall be then capable of being satisfied, other than the condition set forth in Section6.1(c) hereof, the parties hereto may agree in writing to extend such date to a date not later than September 15, 2015;

 

(ii)   if the Company Stockholders’Approval shall not be obtained by reason of the failure to obtain the requisite vote upon a vote held at the Company Stockholders’Meeting, or any adjournment thereof, called therefor;

 

(iii)   if there has beena material breach of any representation, warranty, covenant or agreement on the part of the non-terminating party set forth inthis Agreement, which breach is not curable or, if curable, has not been cured within thirty (30) days following receipt by thenon-terminating party of notice of such breach from the terminating party;

 

(iv)   if any court of competentjurisdiction or other competent Governmental Entity shall have issued an Order or Law making illegal or otherwise restricting,preventing or prohibiting the Merger and such Order or Law shall have become final and non-appealable; or

 

(c)   By the Company if (i) the Company Board shall have determined in good faith, based upon the advice of outside legal counsel, that failure to terminatethis Agreement is reasonably likely to result in the Company Board breaching its fiduciary duties to stockholders under applicableLaw by reason of the pendency of an unsolicited, bona fide Takeover Proposal, but only if the Company and the Subsidiary and

 

 

Representatives of the Company shall have complied with theirobligations under Section 5.2; provided, however, that the Company may not terminate this Agreement pursuantto this clause (c) unless (x) forty-eight (48) hours shall have elapsed after delivery to MM of a written notice of such determinationby such Company Board and (y) the Company shall have paid to MM any amounts owed by it pursuant to Section 7.2(b); or

 

(d)   By MM if the CompanyBoard (or any committee thereof) shall have (i) withdrawn or modified in a manner adverse to MM its Company Board Recommendationor resolved to do so, (ii) recommended or taken no position with respect to a Takeover Proposal or resolved to do so, or (iii) followingthe announcement or making of a Takeover Proposal, failed to publicly reconfirm its Company Board Recommendation within 24 hoursfollowing a written request for such reconfirmation by MM.

 

(e)   Notwithstanding anythingto the contrary in this Article VII, none of  (i) the failure by MM to obtain any Approvals, court orders or otherconsents required for any part of the MM Reorganization, including approval by its Affiliates’ public equityholders of theMM Reorganization, (ii) the failure by the Company to obtain the Company Stockholders’ Approval (other than as a result ofthe Company Board exercising its rights under Section 5.2 in connection with a Takeover Proposal) or (iii) the failure tosecure the Exchange Listing due to the failure to satisfy the NYSE MKT listing requirements with respect to the number of stockholders,minimum price or minimum market value of public float required by such listing requirements, shall be deemed a breach of this Agreementfor the purposes of Section 7.2(b) below.

 

7.2.   Effect of Termination.

 

(a)   If this Agreement isvalidly terminated by either the Company or MM pursuant to Section 7.1, this Agreement will forthwith become null and voidand there will be no Liability or obligation on the part of either the Company or MM (or any of their respective Representativesor Affiliates), except (i) that the provisions of Sections 5.5(b), 5.14 and 5.16 and this Section 7.2will continue to apply following any such termination and (ii) that nothing contained herein shall relieve any party hereto fromLiability for willful breach of its representations, warranties, covenants or agreements contained in this Agreement.

 

(b)   If  (x) theCompany shall have terminated this Agreement pursuant to Section 7.1(c) or (y) MM shall have terminated this Agreementpursuant to Section 7.1(d) or Section 7.1(b)(iii), in either of such cases, the Company shall pay to MM a terminationfee of  $2,500,000. If the Company shall have terminated this Agreement pursuant to Section 7.1(b)(iii), MM shallpay to the Company a termination fee of  $2,500,000. Any fee payable under this Section 7.2(b) shall be paid by wiretransfer of immediately available funds contemporaneous with a termination described in clause (x) or (y).

 

(c)   If, following the publicannouncement of a Takeover Proposal by any Person, either MM or the Company shall have terminated this Agreement pursuant to Section7.1(b)(i) or Section 7.1(b)(ii) and, within six (6) months after any termination described in this sentence, the Companyor the Subsidiary shall have entered into a binding agreement providing for the consummation of  (and which in fact is consummatedpursuant to such binding agreement), or shall have consummated a Company Acquisition Agreement, then, in any of such cases, theCompany shall pay to MM a termination fee of  $2,500,000. Any fee payable under this Section 7.2(c) shall be paidby wire transfer of immediately available funds concurrent with or prior to the consummation of such transaction under the CompanyAcquisition Agreement.

 

(d)   Each party agrees thatin the event that a termination fee is paid pursuant to Section 7.2(b) or Section 7.2(c), the payment of such terminationfee shall be the sole and exclusive remedy of the party to which such fee is paid, its subsidiaries and any of its respective shareholders,Affiliates, officers, directors, employees or representatives (collectively, “Related Persons”), and in no eventwill the party to which such fee is paid or any of its Related Persons be entitled to recover any other money damages or any otherremedy based on a claim in law or equity with respect to, (i) any loss suffered as a result of the failure of the Merger to beconsummated, (ii) the termination of this Agreement, (iii) any liabilities or obligations arising under this Agreement, or (iv)any Legal Action arising out of or relating to any breach, termination or failure of or under this Agreement, and upon paymentto the Company or MM, as applicable, such other party shall not have any further liability or obligation to the party that paidsuch termination fee or any of its Related Persons relating to or arising out of this Agreement or the transactions contemplatedhereby.

 

 

**ArticleVIII**

**DEFINED TERMS**

** **

8.1.   Definitions.   Forpurposes of this Agreement, the following terms will have the following meanings when used herein with initial capital letters:

 

“Acceptable Confidentiality Agreement”means a confidentiality and standstill agreement that contains confidentiality and standstill provisions that are no less favorableto the Company than those contained in the Confidentiality Agreement.

 

“Adjusted MM Option”has the meaning set forth in Section 5.12(a).

 

“Adjusted MM RSU” hasthe meaning set forth in Section 5.12(b).

 

“Affiliate” as appliedto any Person, means any other Person directly or indirectly controlling, controlled by, or under common control with, that Person;for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,”“controlled by” and “under common control with”), as applied to any Person, means the possession,directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whether throughthe ownership of voting securities, by Contract or otherwise.

 

“Agreement” has themeaning set forth in the preamble.

 

“Approvals” has themeaning set forth in Section 3.1(a).

 

“Blue Sky Laws” hasthe meaning set forth in Section 3.5(b).

 

“Book-Entry Shares”has the meaning set forth in Section 2.2(b).

 

“Business Day” meansa day other than a Saturday, Sunday or any day on which banks located in the State of New York are authorized or obligated to close.

 

“Certificates” has themeaning set forth in Section 2.2(b).

 

“Certificates of Merger”has the meaning set forth in Section 1.2.

 

“CGCL” has the meaningset forth in the recitals.

 

“Closing” has the meaningset forth in Section 1.2.

 

“Closing Date” has themeaning set forth in Section 1.2.

 

“COBRA” has the meaningset forth in Section 3.11(f).

 

“Code” has the meaningset forth in the recitals.

 

“Company” has the meaningset forth in the preamble.

 

“Company Acquisition Agreement”has the meaning set forth in Section 5.2.

 

“Company Adverse RecommendationChange” has the meaning set forth in Section 5.2.

 

“Company Board” hasthe meaning set forth in the recitals.

 

“Company Board Recommendation”has meaning set forth in Section 3.25.

 

“Company Common Stock”has the meaning set forth in Section 2.1(a).

 

“Company Disclosure Letter”has the meaning set forth in the preamble to Article III.

 

“Company Financial Advisor”has the meaning set forth in Section 3.27.

 

“Company Financial Statements”has the meaning set forth in Section 3.6.

 

“Company Insurance Policies”has the meaning set forth in Section 3.24.

 

“Company Intellectual PropertyRights” means any Intellectual Property Rights owned by, licensed exclusively to or registered to the Company or theSubsidiary, as applicable.

 

“Company Leases” hasthe meaning set forth in Section 3.15(a).

 

 

“Company Leased Real Estate”has the meaning set forth in Section 3.15(a).

 

“Company Material Adverse Effect”means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in theaggregate, materially adverse to (i) the business, results of operations, condition (financial or otherwise), or assets of theCompany and the Subsidiary, taken as a whole, or (ii) the ability of the Company to consummate the transactions contemplated herebyon a timely basis; provided*,*however*,* that, for the purposes of clause (i), a Company Material AdverseEffect shall not be deemed to include events, occurrences, facts, conditions or changes arising out of, relating to or resultingfrom: (a) changes generally affecting the economy or financial or securities markets; (b) the announcement of the transactionscontemplated hereby, including the impact thereof on the relationships, contractual or otherwise, of the Company or the Subsidiarywith employees, customers, suppliers or partners; (c) any outbreak or escalation of war or any act of terrorism or natural disasters(including hurricanes, tornadoes, floods or earthquakes); (d) changes (including changes of applicable Law) or general conditionsin the industry in which the Company and the Subsidiary operate; (e) changes in GAAP (or authoritative interpretations ofGAAP); (f) any Company Transaction Legal Action, to the extent relating to the negotiations between the parties and the terms andconditions of this Agreement; and (g) compliance with the terms of, or the taking of any action required by, this Agreement (including,without limitation and for the avoidance of doubt, the terms of Section 5.24); provided, further, however,that any event, change and effect referred to in clauses (a), (c) or (d) immediately above shall be taken into account in determiningwhether a Company Material Adverse Effect has occurred or would reasonably be expected to occur to the extent that such event,change or effect has a disproportionate effect on the Company and the Subsidiary, taken as a whole, compared to other participantsin the industries in which the Company and the Subsidiary conduct their respective businesses.

 

“Company Major Customers”has the meaning set forth in Section 3.20.

 

“Company Material Agreements”means each Contract to which the Company or the Subsidiary is a party or subject to or by which its assets are bound which: (a)provides for obligations, payments, Liabilities, consideration, performance of services or the delivery of goods to or by the Companyor the Subsidiary of any amount or value reasonably expected to be in excess of  $1,500,000 annually; (b) contains covenantslimiting the freedom of the Company or the Subsidiary to engage in any line of business in any geographic area or to compete withany Person or restricting the ability of the Company or the Subsidiary to acquire equity interests in any Person; (c) is an employmentor severance contract or indemnification contract, or a consulting or non-compete agreement, applicable to any employee of theCompany or the Subsidiary whose annual total compensation exceeds $200,000 or any director of the Company or the Subsidiary; (d)relates to, or is evidence of, or is a guarantee of, or provides security for, indebtedness or the deferred purchase price of property(whether incurred, assumed, guaranteed or secured by any asset of the Company or the Subsidiary); (e) is a letter of credit, bondor similar arrangement running to the account of, or for the benefit of, the Company or the Subsidiary in an amount in excess of $250,000; (f) is a lease or agreement under which the Company or the Subsidiary is a lessor of or permits any third party to holdor operate any property owned or controlled by the Company or the Subsidiary; (g) relates to the use of, or the right to use, IntellectualProperty Rights by the Company, except for any of the foregoing related to the use of generally available Computer Software thatis sold or licensed under shrink-wrap or click-through terms; (h) is a collective bargaining agreement; (i) is a joint ventureor partnership contract or a limited liability company operating agreement; (j) is entered into with, or otherwise relates to,any Affiliate, officer or director or their family members of the Company or the Subsidiary; (k) cannot be terminated on less than60 days’ notice without penalty or is continuous over a period of more than one year from the date hereof and cannot be terminatedon less than 60 days’ notice without penalty; (l) provides for the payment of cash or other compensation or benefits uponthe Merger and the consummation of the transactions contemplated hereby; (m) relates to any loan to any directors, officers orAffiliates of the Company or the Subsidiary; (n) relates to voting, transfer or other arrangements related to any equity interestsof the Company or the Subsidiary or warrants, options or other rights to acquire any equity interests of the Company or the Subsidiary(other than this Agreement, the Merger and the transactions contemplated hereby); or (o) is otherwise material to the operationsand business prospects of the Company and the Subsidiary.

 

“Company Option Plan”has the meaning set forth in Section 3.3(a).

 

 

“Company Products” hasthe meaning set forth in Section 3.18(a).

 

“Company Permits” hasthe meaning set forth in Section 3.7(b).

 

“Company Plans” hasthe meaning set forth in Section 3.11(a).

 

“Company Registered IntellectualProperty Rights” means any Registered Intellectual Property Rights included in the Company Intellectual Property Rights.

 

“Company RSU” has themeaning set forth in Section 5.12(b).

 

“Company RSU Awards”has the meaning set forth in Section 3.3(a).

 

“Company SEC Reports”has the meaning set forth in Section 3.6.

 

“Company Stockholders’ Approval”has the meaning set forth in Section 3.26.

 

“Company Stockholders’ Meeting”has the meaning set forth in Section 5.7.

 

“Company Transaction Legal Action”has the meaning set forth in Section 5.15.

 

“Company Warrants” hasthe meaning set forth in Section 2.1(c).

 

“Computer Software”means all computer programs, databases, compilations, data collections (in each case, whether in human-readable, machine readable,source code or object code form) and documentation related to the foregoing.

 

“Confidentiality Agreement”means that certain Mutual Confidentiality and Non-Disclosure Agreement and Restrictive Covenant by and between MM and the Company,dated September 23, 2013.

 

“Continuing Employee”has the meaning set forth in Section 5.22.

 

“Contract” means anycontract, agreement, license, lease, guaranty, indenture, sales or purchase order or other legally binding commitment in the natureof a contract (whether or not written) to which a Person is a party.

 

“Contributed Assets”has the meaning set forth in the definition of  “MM Reorganization.”

 

“Credit Agreement” meansthat certain Loan and Security Agreement by and among the Subsidiary and Imperium Commercial Finance Master Fund LP dated September 11,2012.

 

“DGCL” has the meaningset forth in the recitals.

 

“DOL” means the UnitedStates Department of Labor.

 

“DTC” has the meaningset forth in Section 2.2(b).

 

“Effective Time” hasthe meaning set forth in Section 1.2.

 

“Environmental Claim”means any and all administrative, regulatory or judicial Legal Actions alleging Liability arising out of or resulting from: (1)the presence or Release into the environment of any Hazardous Substance at the Company Leased Real Estate or MM Leased Real Estate,as applicable; or (2) any violation of Environmental Law.

 

“ Environmental Laws”means all federal, state or local statutes, laws, regulations, judgments and orders in effect on the Effective Time and relatingto protection of human health or the environment, including laws and regulations relating to Releases or threatened Releases ofHazardous Substances, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transportor handling of Hazardous Substances.

 

“ Environmental Permits”means all governmental licenses, permits, registrations and government approvals issued pursuant to Environmental Law.

 

“ERISA” has the meaningset forth in Section 3.11(a).

 

“ERISA Affiliate” hasthe meaning set forth in Section 3.11(a).

 

“Exchange Act” has themeaning set forth in Section 3.5(b).

 

 

“Exchange Agent” hasthe meaning set forth in Section 2.2(a).

 

“Exchange Listing” hasthe meaning set forth in Section 6.1(c).

 

“Exchange Reserve” hasthe meaning set forth in Section 2.2(a).

 

“Exchange Ratio” hasthe meaning set forth in Section 2.1(a).

 

“existing subsidiaries”has the meaning set forth in Section 4.1(a).

 

“GAAP” has the meaningset forth in Section 3.6(a).

 

“Governmental Entity”has the meaning set forth in Section 3.5(b).

 

“ Hazardous Substances”means any chemicals, materials or substances which are defined as or included in the definition of  “hazardous substances,”“hazardous wastes,” “hazardous materials,” “extremely hazardous wastes,” “restrictedhazardous wastes,” “toxic substances,” “toxic pollutants” or similar terms under any EnvironmentalLaw.

 

“Indebtedness” means,without duplication to current liabilities, all (i) obligations for borrowed money (including any unpaid principal, premium, accruedand unpaid interest, prepayment penalties, commitment and other fees, reimbursements, indemnities and all other amounts payablein connection therewith), (ii) liabilities evidenced by bonds, debentures, notes, or other similar instruments or debt securities,(iii) obligations, contingent or otherwise, in respect of any letters of credit or bankers’ acceptances (to the extentdrawn), sureties, performance bonds, guaranties, endorsements and other similar obligations, whether secured or not, in respectof the obligations of other Persons, (iv) obligations (including accrued interest) without duplication under a lease agreementthat would be capitalized pursuant to GAAP and (v) the deferred purchase price of property or services (excluding earn-outobligations which shall not be deemed Indebtedness under this Agreement). For purposes of calculating Indebtedness, (a) all interest,prepayment penalties, premiums, fees and expenses (if any) and other amounts which would be payable if Indebtedness were paid infull at the Closing shall be treated as Indebtedness and (b) all PIK instruments (including all interest, prepayment penalties,premiums, fees and expenses relating thereto) shall constitute “Indebtedness”. Notwithstanding the foregoing, for purposesof calculating Indebtedness under this Agreement, indebtedness incurred by MM to fund the costs, fees and expenses of the transactionscontemplated by Section 5.1(b) of the MM Disclosure Letter shall not constitute “Indebtedness” under this Agreement.

 

“Indemnified Liabilities”has the meaning set forth in Section 5.13(a).

 

“Indemnified Parties”has the meaning set forth in Section 5.13(a).

 

“Intellectual Property Rights”means all worldwide (a) inventions, whether or not patentable, (b) patents and patent applications, (c) trademarks, trademarkapplications, service marks, service mark applications, trade dress, logos, Internet domain names and trade names, whether or notregistered, and all goodwill associated therewith, (d) rights of publicity and other rights to use the names and likeness of individuals,(e) copyrights and related rights, whether or not registered, (f) Computer Software, data, databases, files, and documentationand other materials related thereto, (g) trade secrets and all confidential, technical, technological, industrial, business processesand business information, (h) know how, (i) all rights in any of the foregoing provided by bilateral or international treatiesor conventions, and (j) all rights to sue or recover and retain damages and costs and attorneys’ fees for past, present andfuture infringement or misappropriation of any of the foregoing.

 

“International Employee Plan”means an employee plan that has been adopted or maintained by a Person, whether informally or formally, for the benefit of currentor former employees of such Person outside the United States.

 

“IRS” means the UnitedStates Internal Revenue Service.

 

“Knowledge” means, withrespect to the Company, the actual Knowledge after reasonable enquiry of the Persons listed in Section 8.1 of the CompanyDisclosure Letter,****and with respect to MM, the actual Knowledge after reasonable enquiry of the Persons listed in Section8.1 of the MM Disclosure Letter; provided in each case that such enquiry shall not require making enquiries of customers, suppliersor other third party contractors.

 

 

“Law” has the meaningsset forth in Section 3.3(a).

 

“Legal Action” meansclaim, action, suit, arbitration, proceeding or governmental investigation or proceeding.

 

“Liabilities” has themeaning set forth in Section 3.9.

 

“License Agreements”means all agreements (whether written or oral, including license agreements, research agreements, development agreements, distributionagreements, consent to use agreements and covenants not to sue, or settlement agreements containing like provisions) to which aPerson is a party or otherwise bound, pursuant to which a Person has granted or been granted any right to use, exploit or practiceany Intellectual Property Rights, or that restrict the right of a Person to use or enforce any Intellectual Property Rights.

 

“Licensed Intellectual PropertyRights” means any Intellectual Property Rights owned by a third party that a Person has a right to use, exploit or practiceby virtue of a license grant, immunity from Legal Action or otherwise.

 

“Liens” means all liens,pledges, hypothecations, charges, mortgages, security interests, encumbrances, claims, infringements, interferences, options, rightof first refusals, preemptive rights, community property interests or restriction of any nature (including any restriction on thevoting of any security, any restriction on the transfer of any security or other asset, any restriction on the possession, exerciseor transfer of any other attribute of ownership of any asset), other than Permitted Liens.

 

“Merger” has the meaningset forth in Section 1.1.

 

“MM” has the meaningset forth in the preamble.

 

“MM Benefit Plans” hasthe meaning set forth in Section 4.10(a).

 

“MM Disclosure Letter”has the meaning set forth in the preamble to Article IV.

 

“MM Financial Statements”has the meaning set forth in Section 4.25(a).

 

“MM Insurance Policies”has the meaning set forth in Section 4.22.

 

“MM Intellectual Property Rights”means any Intellectual Property Rights owned by, licensed to or registered to MM, any of its subsidiaries or the Contributed Assets,as applicable.

 

“MM Leased Real Estate”has the meaning set forth in Section 4.14(a).

 

“MM Leases” has themeaning set forth in Section 4.14(a).

 

“MM Material Adverse Effect”means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in theaggregate, materially adverse to (i) the business, results of operations, condition (financial or otherwise), or assets of MM,its subsidiaries and the Contributed Assets, taken as a whole, or (ii) the ability of MM to consummate the transactions contemplatedhereby on a timely basis; provided*,*however*,*that, for the purposes of clause (i), a MM Material AdverseEffect shall not be deemed to include events, occurrences, facts, conditions or changes arising out of, relating to or resultingfrom: (a) changes generally affecting the economy or financial or securities markets; (b) the announcement of the transactionscontemplated hereby, including the impact thereof on the relationships, contractual or otherwise of MM or any of its subsidiariesor the Contributed Assets with employees, customers, suppliers or partners; (c) any outbreak or escalation of war or any act ofterrorism or natural disasters (including hurricanes, tornadoes, floods or earthquakes); (d) changes (including changes of applicableLaw) or general conditions in the industry in which MM, its subsidiaries or the Contributed Assets operate; (e) changes in GAAP(or authoritative interpretations of GAAP) and (f) compliance with the terms of, or the taking of any action required by,this Agreement (including, without limitation and for the avoidance of doubt, the terms of Section 5.24); provided,further, however, that any event, change and effect referred to in clauses (a), (c) or (d) immediately above shallbe taken into account in determining whether a MM Material Adverse Effect has occurred or would reasonably be

 

 

expected to occur to the extent that such event, change or effecthas a disproportionate effect on MM, its subsidiaries and the Contributed Assets, taken as a whole, compared to other participantsin the industries in which MM, its subsidiaries or the Contributed Assets conduct their respective businesses.

 

“MM Major Customers”has the meaning set forth in Section 4.19.

 

“MM Material Agreements”means each Contract to which MM or any of its subsidiaries is a party or subject to or by which its assets are bound which: (a)provides for obligations, payments, Liabilities, consideration, performance of services or the delivery of goods to or by MM orany of its subsidiaries of any amount or value reasonably expected to be in excess of  $2,500,000 annually; (b) containscovenants limiting the freedom of MM or any of its subsidiaries to engage in any line of business in any geographic area or tocompete with any Person or restricting the ability of MM or any of its subsidiaries to acquire equity interests in any Person;(c) is an employment or severance contract, or indemnification contract, or a consulting or non-compete agreement, applicable toemployees of MM, any of its subsidiaries or the Contributed Assets whose annual total compensation exceeds $350,000 or a directorof the Company or any of its subsidiaries; (d) relates to, or is evidence of, or is a guarantee of, or provides security for, indebtednessor the deferred purchase price of property (whether incurred, assumed, guaranteed or secured by any asset of MM or any of its subsidiaries);(e) is a letter of credit, bond or similar arrangement running to the account of, or for the benefit of, MM or any of its subsidiariesin an amount in excess of  $500,000; (f) is a lease or agreement under which MM or any of its subsidiaries is a lessor ofor permits any third party to hold or operate any property owned or controlled by MM or any of its subsidiaries; (g) relates tothe use of, or the right to use, Intellectual Property Rights by MM, except for any of the foregoing related to the use of generallyavailable computer software that is sold or licensed under shrink-wrap or click-through terms; (h) is a collective bargaining agreement;(i) is a joint venture or partnership contract or a limited liability company operating agreement; (j) is entered into with, orotherwise relates to, any Affiliate, officer, director or their family members of MM or any of its subsidiaries; (k) cannot beterminated on less than 60 days’ notice without penalty or is continuous over a period of more than one year from the datehereof and cannot be terminated on less than 60 days’ notice without penalty; (l) provides for the payment of cash orother compensation or benefits upon the Merger and the consummation of the transactions contemplated hereby; (m) relates to anyloan to any directors, officers, managers or Affiliates of MM or any of its subsidiaries; (n) relates to voting, transfer or otherarrangements related to any equity interests of MM or any of its subsidiaries or warrants, options or other rights to acquire anyequity interests of MM or any of its subsidiaries (other than this Agreement, the Merger and the transactions contemplated hereby);or (o) is otherwise material to the operations and business prospects of MM, any of its subsidiaries or the Contributed Assets.

 

“MM Permits” has themeaning set forth in Section 4.6(b).

 

“MM Products” meansall Computer Software and service offerings that MM or any of its subsidiaries have licensed, sold, distributed or otherwise disposedto third parties in the five (5) years prior to the date hereof, or that MM or any of its subsidiaries intends to produce, sell,distribute or otherwise dispose of in the future, with respect to which MM, any of its subsidiaries or the Contributed Assets asof the date hereof is obligated to provide maintenance or support obligation, including in each case any products or service offeringsunder development.

 

“MM Registered Intellectual PropertyRights” means any Registered Intellectual Property Rights included in the MM Intellectual Property Rights.

 

“MM Reorganization”means the contribution in a series of transactions set forth in Section 4.26 of the MM Disclosure Letter of all of the issuedand outstanding equity interests of each of Mastek MSC Sdn. Bhd. and Majesco Canada Ltd., and of all of the UK insurance businessassets of Mastek (UK) Ltd. and the insurance business assets of Majesco Software and Solutions India Private Limited (together,the “Contributed Assets”) to MM or its subsidiaries such that, after giving effect to all such transactionsset forth in Section 4.26 of the MM Disclosure Letter, MM will be the direct or indirect owner of all of the ContributedAssets.

 

“MM Reorg Contracts”has the meaning set forth in Section 4.26(a).

 

“MM Stock” has the meaningset forth in Section 4.3(a).

 

 

“MM Stockholders’ Approval”has the meaning set forth in Section 4.24.

 

“MM US GAAP Financials”has the meaning set forth in Section 4.25(b).

 

“Notice Period” hasthe meaning set forth in Section 5.2(d).

 

“One-Time Charge” hasthe meaning set forth in Section 5.24.

 

“Options” has the meaningset forth in Section 3.3(a).

 

“Order” has the meaningset forth in Section 3.3(a).

 

“Permitted Liens” means(a) statutory Liens for current Taxes or other governmental charges not yet due and payable or the amount or validity of whichis being contested in good faith, (b) mechanics’, carriers’, workers’, repairers’ and similar statutoryLiens arising or incurred in the ordinary course of business for amounts which are not delinquent or which are being contestedby appropriate proceedings, (c) zoning, entitlement, building and other land use regulations imposed by Governmental Entitieshaving jurisdiction over such Person’s owned or leased real property, which are not violated by the current use and operationof such real property, (d) covenants, conditions, restrictions, easements and other similar non-monetary matters of record affectingtitle to such Person’s owned or leased real property, which do not materially impair the occupancy or use of such real propertyfor the purposes for which it is currently used in connection with such Person’s businesses, (e) any right of way or easementrelated to public roads and highways, which do not materially impair the occupancy or use of such real property for the purposesfor which it is currently used in connection with such Person’s businesses, (f) Liens arising under workers’ compensation,unemployment insurance, social security, retirement and similar legislation, (g) with respect to the Company or the Subsidiary,Liens securing indebtedness of the Company or the Subsidiary, provided that such indebtedness shall be in existence on the datehereof, and (h) any other Liens that, in the aggregate, do not materially impair the value or the continued use and operation ofthe assets or properties to which they relate.

 

“Person” means any individual,corporation (including any non-profit corporation), general partnership, limited partnership, limited liability partnership, jointventure, estate, trust, company (including any limited liability company or joint stock company), firm or other enterprise, association,organization, entity or Governmental Entity.

 

“Proxy Statement” meansthe proxy statement relating to the Company Stockholders’ Meeting for the Company’s Stockholders’ Approval tobe filed with the SEC by the Company, as may be amended or supplemented from time to time.

 

“Registered Intellectual PropertyRights” means all patents and patent applications, registered copyrights and copyright applications, registered trademarksand trademark applications, and any other Intellectual Property Right that is the subject of an application, certificate, filing,registration or other document issued by, filed with, or recorded by, any Governmental Entity.

 

“Registration Statement”means the registration statement on Form S-4 to be filed with the SEC by MM for the issuance of the shares of Surviving CorporationCommon Stock in the Merger, as may be amended or supplemented from time to time.

 

“Regulatory Agreement”has the meaning set forth in Section 3.21.

 

“Related Persons” hasthe meaning set forth in Section 7.2(d).

 

“ Release” means anyrelease, spill, emission, emptying, leaking, injection, deposit, disposal, discharge, dispersal, leaching, pumping, pouring, ormigration into the atmosphere, soil, surface water, groundwater or property.

 

“Reorg Subsidiaries”has the meaning set forth in Section 4.1(a).

 

“Representatives” ofany entity means such entity’s directors, officers, employees, legal, investment banking and financial advisors, accountantsand any other agents and representatives.

 

“Sarbanes-Oxley Act”has the meaning set forth in Section 3.6(e).

 

 

“SEC” means the U.S. Securitiesand Exchange Commission.

 

“Securities Act” has themeaning set forth in Section 3.5(b).

 

“Shared Expenses” has themeaning set forth in Section 5.14.

 

“Shares” has the meaningset forth in Section 2.2(b).

 

“Sharing Ratio” means 83.5%as to MM and 16.5% as to the Company.

 

“Subsidiary” has the meaningset forth in Section 3.1(a).

 

“subsidiary” means, withrespect to any Person, any corporation or other organization, whether incorporated or unincorporated, of which more than fiftypercent (50%) of either the equity interests in, or the voting control of, such corporation or other organization is, directlyor indirectly through subsidiaries or otherwise, beneficially owned by such Person.

 

“Superior Proposal”****meansa bona fide written Takeover Proposal that the Company Board determines in good faith (after consultation with outside legal counseland the Company’s financial advisors) is more favorable from a financial point of view to the holders of Company Common Stockthan the Merger and other transactions contemplated hereby, taking into account (a) all financial considerations, (b) the identityof the third party making such Takeover Proposal, (c) the anticipated timing, conditions (including any financing condition orthe likelihood of obtaining financing pursuant to of any debt or equity funding commitments) and prospects for completion of suchTakeover Proposal, (d) the other terms and conditions of such Takeover Proposal and the implications thereof on the Company andits stockholders, including such legal, regulatory and other aspects of such Takeover Proposal as deemed relevant by the CompanyBoard, including potential synergies and other business considerations, and (e) any revisions to the terms of this Agreementand the Merger proposed by MM during the Notice Period set forth in Section 5.2(d).

 

“Surviving Corporation”has the meaning set forth in Section 1.1.

 

“Surviving Corporation Common Stock”has the meaning set forth in Section 2.1(a).

 

“Takeover Proposal”****meansa proposal or offer, or indication of interest in making a proposal or offer, from any Person (other than MM) relating to any (a)direct or indirect acquisition of equity or assets of the Company or the Subsidiary equal to twenty five percent (25%) or moreof the fair market value of the Company’s consolidated assets or to which twenty five percent (25%) or more of the Company’snet revenues or net income on a consolidated basis are attributable, (b) direct or indirect acquisition of twenty five percent(25%) or more of the voting equity interests of the Company, (c) tender offer or exchange offer that if consummated would resultin any Person beneficially owning (within the meaning of Section 13(d) of the Exchange Act) twenty five percent (25%) or more ofthe voting equity interests of the Company, (d) merger, consolidation, other business combination or similar transaction involvingthe Company or the Subsidiary, pursuant to which the holders of the Company’s shares immediately prior to such transactionown, in the aggregate, less than eighty-five percent (85%) of the outstanding voting power of the surviving or resulting entityin such transaction immediately after the consummation thereof; provided that the consummation of the transactions contemplatedby such proposal or offer are conditioned on the termination of this Agreement, or (e) liquidation or dissolution (or the adoptionof a plan of liquidation or dissolution) of the Company or the declaration or payment of an extraordinary dividend (whether incash or other property) by the Company.

 

“Tax” or “Taxes”has the meaning set forth in Section 3.16(a).

 

“Tax Returns” has the meaningset forth in Section 3.16(b).

 

“Transaction Documents”has the meaning set forth in Section 3.4.

 

“Unvested Company RSU” hasthe meaning set forth in Section 5.12(b).

 

“Vested Company RSU” hasthe meaning set forth in Section 5.12(c).

 

“Voting Agreement” has themeaning set forth in the recitals.

 

 

“WC Closing Certificate”has the meaning set forth in Section 5.23.

 

“Working Capital” of a partymeans (i) the current assets (including cash and cash equivalents) minus (ii) the current liabilities, and minus(iii) all Indebtedness of such party as of the date of determination, in each case, determined in accordance with GAAP consistentlyapplied in such party’s historical financial statements and derived from such party’s books and records and excludingthe effects or anticipated effects of the Merger or any change in circumstances or similar development arising after the ClosingDate; provided that (x) the Working Capital of each party shall include in current liabilities all unpaid costs and expensesof such party related to this Agreement, the Transaction Documents and the consummation of the Merger and the other transactionscontemplated thereunder, including all costs and expenses of such party pursuant to Section 5.13, 5.14 and 5.15and (y) the current liabilities of the Company shall include and reflect unanticipated current liabilities arising as a resultof the Merger.

 

**ArticleIX**

**GENERAL PROVISIONS**

** **

9.1.   Non-Survival of Representationsand Warranties.   The representations and warranties of the Company and MM contained in this Agreement shallterminate at the Effective Time, and only the covenants that by their terms survive the Effective Time shall survive the EffectiveTime.

 

9.2.   Notices.   Allnotices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemedto have been given (a) when delivered by hand (with written confirmation of receipt), (b) when received by the addressee if sentby a nationally recognized overnight courier (receipt requested), (c) on the date sent by facsimile or e-mail of a PDF document(with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sentafter normal business hours of the recipient, or (d) on the third day after the date mailed, by certified or registered mail, returnreceipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or atsuch other address for a party as shall be specified in a notice given in accordance with this Section 9.2):

 

(a) if to MM (following the Effective Time), to:

 

Majesco

5 Penn Plaza, 33rd Street & 8th Avenue, 14th Floor

New York, NY 10001

Attention: Ketan Mehta, Chief Executive Officer, FaridKazani,

Chief Financial Officer and Lori Stanley, General Counsel

Telephone No.: 646-731-1000

Telecopy No.: 646-674-1392

 

with a copy to (which will not constitute notice to MM):

 

Pepper Hamilton LLP

620 Eighth Avenue

New York, NY 10018

Attention: Valérie Demont

Telephone No.: 212.808.2745

Telecopy No.: 212.286.9806

 

(b) if to the Company, to:

 

Cover-All Technologies Inc.

412 Mt. Kemble Avenue, Suite 110C

Morristown, New Jersey

Attention: Manish D. Shah, President and Chief ExecutiveOfficer

Telephone No.: 973-461-5200

Telecopy No.: 973-461-5204

 

 

with a copy to (which will not constitute notice to theCompany):

 

Sills Cummis & Gross P.C.

101 Park Avenue, 28th Floor

New York, New York 10178

Attention: David E. Weiss

Telephone No.: 212.500.1579

Telecopy No.: 212.643.6500

 

or to such other Persons, addresses or facsimile numbers as maybe designated in writing by the Person entitled to receive such communication as provided above.

 

9.3.   Interpretation.   Whena reference is made in this Agreement to Exhibits, such reference shall be to an Exhibit to this Agreement unless otherwise indicated.When a reference is made in this Agreement to Sections, such reference shall be to a Section of this Agreement. Unless otherwiseindicated the words “include,” “includes” and “including” when used herein shall be deemedin each case to be followed by the words “without limitation.” The and headings contained in this Agreement are forreference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. When reference is madeherein to “the business of” an entity, such reference shall be deemed to include the business of all direct and indirectsubsidiaries of such entity. A reference in this Agreement to $ or dollars is to U.S. dollars. The words “hereof,”“herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreementas a whole and not to any particular provision of this Agreement. References to “this Agreement” shall include theCompany Disclosure Letter.

 

9.4.   Counterparts.   ThisAgreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall becomeeffective when one or more counterparts have been signed by each of the parties and delivered to the other party, it being understoodthat all parties need not sign the same counterpart.

 

9.5.   Entire Agreement;Third Party Beneficiaries.   This Agreement and the documents and instruments and other agreements among theparties hereto as contemplated by or referred to herein, including the Confidentiality Agreement, Company Disclosure Letter andthe MM Disclosure Letter (i) constitute the entire agreement among the parties with respect to the subject matter hereof andsupersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matterhereof; and (ii) except as provided in Section 5.13, are not intended to confer upon any other Person any rights or remedieshereunder.

 

9.6.   Amendment.   ThisAgreement may be amended, supplemented or modified by action taken by or on behalf of the respective Boards of Directors of theparties hereto at any time prior to the Effective Time, whether prior to or after the Company Stockholders’ Approval shallhave been obtained, but after such adoption and approval, only to the extent permitted by applicable Law or in accordance withthe rules of any self-regulatory organization. No such amendment, supplement or modification shall be effective unless set forthin a written instrument duly executed by or on behalf of each party hereto.

 

9.7.   Waiver.   Atany time prior to the Effective Time any party hereto, by action taken by or on behalf of its Board of Directors, may to the extentpermitted by applicable Law (i) extend the time for the performance of any of the obligations or other acts of the other partyhereto, (ii) unless prohibited by applicable Law, waive any inaccuracies in the representations and warranties or compliance withthe covenants and agreements of the other party hereto contained herein or in any document delivered pursuant hereto or (iii) unlessprohibited by applicable Law, waive compliance with any of the conditions of such party contained herein. No such extension orwaiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the party extending the timeof performance or waiving any such inaccuracy or non-compliance. No waiver by any party of any term or condition of this Agreement,in any one or more instances, shall be deemed to be or construed as a waiver of the same or any other term or condition of thisAgreement on any future occasion

 

9.8.   Severability.   Inthe event that any provision of this Agreement or the application thereof, becomes or is declared by a court of competent jurisdictionto be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the applicationof such provision to

 

 

other Persons or circumstances will be interpreted so as reasonablyto effect the intent of the parties hereto. The parties further agree to negotiate in good faith to modify this Agreement so asto replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that is mutually agreeableto the parties and that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceableprovision.

 

9.9.   Governing Law; DisputeResolution.   This Agreement, and all claims or causes of action (whether at law, in contract or in tort) thatmay be based upon, arise out of or relate to this Agreement or the negotiation, execution or performance hereof, shall be governedby and construed in accordance with the Laws of the State of Delaware, without giving effect to any choice or conflict of law provisionor rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdictionother than the State of Delaware. Each of the parties hereto irrevocably (i) consents to submit itself to the personal jurisdictionof the Court of Chancery of the State of Delaware in the event any dispute arises out of this Agreement or any of the transactionscontemplated hereby, and, in connection with any such matter, to service of process by notice as otherwise provided herein, (ii)agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any suchcourt and (iii) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated herebyin any court other than the Court of Chancery of the State of Delaware. In the event (but only in the event) that the Court ofChancery of the State of Delaware does not have subject matter jurisdiction over such action or proceeding, then the parties willsubmit to personal jurisdiction of any federal court in the State of Delaware. Any party may make service on another party by sendingor delivering a copy of the process to the party to be served at the address and in the manner provided for the giving of noticesin Section 9.2.

 

9.10.   Rules of Construction.   Theparties hereto agree that they have been represented by counsel during the negotiation and execution of this Agreement and, therefore,waive the application of any Law, regulation, holding or rule of construction providing that ambiguities in an agreement or otherdocument will be construed against the party drafting such agreement or document.

 

9.11.   Assignment.   Noparty may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written approvalof the other party. Subject to the preceding sentence, this Agreement shall be binding upon and shall inure to the benefit of theparties hereto and their respective successors and permitted assigns.

 

9.12.   WAIVER OF JURY TRIAL.   EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF THE PARTIES IN THENEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.

 

*[Remainder of Page Intentionally Left Blank]*

 

 

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

 

 

*[Signature Page to Agreement and Plan ofMerger]*

* *