Document:

Exhibit 10.3

 

Execution Version

 

INVESTMENT AGREEMENT

 

THIS INVESTMENT AGREEMENT (this “Agreement”) is made as of March 7, 2019 by and between VIA optronics AG, a German stock corporation (Aktiengesellschaft), with business address at Sieboldstraße 18, 80411 Nuremberg, Germany (“VIA”), VIA Optronics GmbH, a German private limited company (Gesellschaft mit beschränkter Haftung), with business address at Lettenfeldstraße 15, 90592 Schwarzenbruck, Germany (“VIA GmbH”) and Corning Research & Development Corporation, a Delaware corporation, with business address at One Riverfront Plaza, Corning, New York 14831, USA (“Corning”).

 

WHEREAS, concurrently with the execution of this Agreement, VIA GmbH and Corning Automotive Glass Solutions (Hefei) Co., Ltd. are entering into each of that certain Long Term Supply Agreement and Manufacturing Services Agreement and VIA GmbH and Corning Auto Glass Solutions LLC are entering into that certain Development Agreement (collectively, the “Commercial Agreements”);

 

WHEREAS, VIA is organized in the legal form of the German stock corporation (Aktiengesellschaft) and is in the process of becoming duly registered in the commercial register of the Local Court of Nuremberg. The registered share capital of VIA amounts to EUR 100,000 and is divided into 100,000 non-par value shares (nennwertlose Stückaktien). On the date hereof, no authorized capital and no conditional capital exist for VIA. The registered share capital of VIA is owned as follows:

 

	
Name of shareholder
    	
 
    	
Number of non-par
   value shares
    	
 
    	
Percentage
    	
 
    
	
Coöperatief IMI   Europe U.A. (“IMI”)
    	
 
    	
76,000
    	
 
    	
76
    	
%
    
	
Mr. Jürgen   Eichner (“Mr. Eichner”)
    	
 
    	
24,000
    	
 
    	
24
    	
%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total
    	
 
    	
100,000
    	
 
    	
100
    	
%
    

 

WHEREAS, VIA GmbH is registered in the commercial register of the Local Court of Nuremberg under HRB 22650. The share capital of VIA GmbH amounts to EUR 73,327 and is as of the date hereof owned as follows:

 

	
Name of shareholder
    	
 
    	
Nominal amount of
   shares in EUR
    	
 
    	
Percentage
    	
 
    
	
IMI
    	
 
    	
16,584
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
1,711
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
5,132
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
13,150
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
3,500
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
15,652
    	
 
    	
 
    	
 
    
	
Subtotal:
    	
 
    	
55,729
    	
 
    	
76
    	
%
    
	
Mr. Eichner
    	
 
    	
17,598
    	
 
    	
24
    	
%
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total
    	
 
    	
73,327
    	
 
    	
100
    	
%
    

 

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WHEREAS, IMI and Mr. Eichner will contribute and transfer in due course, but in any case prior to the consummation of the IPO, the respective shares in VIA GmbH in the course of a capital increase in kind of VIA to VIA (“Capital Increase”). Following the consummation of the Capital Increase, (i) VIA will become the sole shareholder of VIA GmbH and (ii) IMI and Mr. Eichner will increase the number of shares owned by each of them on a pro rata basis so that IMI continues to own 76% of the shares in VIA and Mr. Eichner 24% of the shares in VIA.

 

WHEREAS, VIA GmbH owns

 

·                  100% the shares in the following companies

 

·                  VIA optronics (Suzhou) Co. Ltd., a company duly organized and existing under the laws of China, with its seat in Suzhou, China, and unified social credit number 91320505576725426F, with a registered share capital in the nominal amount of EUR 4,700,000;

 

·                  VIA optronics LLC, a company duly organized and existing under the laws of Oregon, registered with the Division of Corporations of the state of Oregon under the registration number 587590-94, with a registered share capital in the nominal amount of USD 2,305,000; and

 

·                  VIA optronics (Taiwan) Ltd., a company duly established and existing under the laws of Taiwan, with its registered seat in Taipei, Taiwan, and registration number 50907057, and a total share capital in the amount of TWD 5,000,000;

 

·                  65% of the shares in VTS-Touchsensor Co., Ltd., a company duly organized and existing under the laws of Japan, with registered seat in Shiga, Japan, and a total share capital in the nominal amount of JPY 324,970,770, of which JPY 211,231,000 have been paid up.

 

WHEREAS, VIA collectively with VIA GmbH and all the aforementioned companies is hereinafter referred to as “Group Companies” and each such company individually as “Group Company”.

 

WHEREAS, VIA is anticipating undertaking an initial underwritten public offering (the “IPO”) that is registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), of American Depositary Shares (the “ADSs”) representing VIA’s ordinary shares, with notional value €1.00 per share (the “Ordinary Shares”), and, in connection with the IPO, to list the ADSs for trading on the New York Stock Exchange;

 

WHEREAS, the ADSs will be issued pursuant to a deposit agreement (the “Deposit Agreement”) among VIA, Bank of New York Mellon, as depositary (the “Depositary”), and holders and beneficial owners from time to time of the American Depositary Receipts issued by the Depositary and evidencing the ADSs;

 

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WHEREAS, Corning desires to subscribe for and purchase from VIA, and VIA desires to issue, sell and transfer to Corning, in a transaction exempt from registration under the U.S. Securities Act and other applicable securities laws, ADSs at the purchase price per ADS specified in this Agreement; and

 

WHEREAS, the parties hereto have executed this Agreement on the date first written above, which is prior to the date on which the registration statement on Form F-1 relating to the offering and sale of ADSs in the IPO has been declared effective by the U.S. Securities and Exchange Commission (the “SEC”);

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereby agree as follows:

 

Section 1.                                           Purchase and Sale of the Corning Shares. Subject to the terms and conditions of this Agreement, at the Closing (as defined in Section 2), VIA agrees to issue, sell and transfer to Corning, free and clear of any pledges, encumbrances, attachments or other third-party rights, and Corning agrees to subscribe for and purchase from VIA, the number of ADSs (the “Corning Shares”) equal to that number, rounded down to the nearest whole number, which is obtained by dividing (x) USD 20,000,000.00 (the “Purchase Amount”) by (y) the purchase price per ADS sold to Corning (the “Purchase Price”). The Purchase Price is equal to the price obtained by multiplying (a) the price per ADS sold to the public in the IPO as set forth on the cover of the Final Prospectus (as defined in Section 3.7) by (b) 95%.

 

Section 2.                                           Closing. The closing of the purchase and sale of the Corning Shares (the “Closing”) shall take place concurrently with the initial closing of the IPO (the “Closing Date”) and remotely via the exchange of documents and signatures, or at such physical location as may be agreed upon by VIA and Corning, after the satisfaction or waiver of each of the conditions set forth in Section 6 and Section 7 (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions).

 

2.1.                            VIA’s Obligations at Closing. At the Closing, VIA (i) shall issue, sell and transfer, or cause to be issued, sold and transferred, to Corning ADSs in the amount representing the number of Corning Shares, as determined pursuant to Section 1, by corresponding increase of VIA’s registered share capital with respect to the Ordinary Shares represented by such ADSs, and (ii) shall exclusively admit or cause to be exclusively admitted Corning to subscribe for and purchase ADSs in the amount representing the number of Corning Shares, as determined pursuant to Section 1.

 

2.2.                            Corning’s Obligations at Closing. At the Closing, only after VIA has fulfilled its obligations as set forth in Section 2.1, Corning (i) shall subscribe for and purchase ADSs in the amount representing the number of Corning Shares, as determined pursuant to Section 1, by executing two (2) subscription declarations pursuant to and as required by § 185 German Stock Corporation Act with respect to the Ordinary Shares represented by such ADSs and shall deliver the executed subscription declarations to VIA, and (ii) shall pay to VIA an amount equal to the nominal amount of the Corning Shares (the “Capital Contribution”) in the form of a wire transfer in the currency Euro in immediately available funds to a bank account designated in writing by VIA at least two Business Days before the Closing Date.

 

2.3.                            VIA’s Obligations after the Closing. Following Corning’s fulfillment of its obligations as set forth in Section 2.2, VIA shall take all actions reasonably necessary to complete the issuance, sale and transfer of the Corning Shares to Corning, including, without limitation, (i) filing of the corresponding increase of VIA’s registered share capital to the competent commercial register and (ii) delivery to Corning or its nominee of instruments of transfer and evidence of ownership of the Corning Shares in accordance with the provisions of the Deposit Agreement. After the capital increase of VIA for the creation of the Corning Shares has been duly recorded in the commercial register of the

 

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Local Court of Nuremberg, VIA shall send a copy of a certified excerpt from the commercial register evidencing the occurrence of such registration to Corning.

 

2.4.                            Corning’s Obligations after the Closing. Within a period of three (3) Business Days following the receipt of the excerpt from the commercial register pursuant to Section 2.3 by Corning, Corning shall pay to VIA an amount equal to the Purchase Amount minus the amount of the Capital Contribution (converted into USD on the basis of the applicable USD/EUR exchange rate as published by the Wall Street Journal Europe at 11.00 am (German time) on the website “wsj.com” on the date of payment of the Contribution Amount to VIA) (the “Share Premium Payment”) in the form of a wire transfer in US dollars in immediately available funds to a bank account designated in writing by VIA at least three (3) Business Days before such payment becomes due. If Corning fails to make the Share Premium Payment pursuant to this Section 2.4 by the date required and within a further grace period of five (5) Business Days after a respective written notice by VIA, Corning shall be obliged, upon request of VIA, to transfer the Corning Shares subscribed by it to VIA or to VIA’s designee in return for reimbursement of the respective Capital Contribution. The Share Premium Payment shall be booked as an additional contribution (sonstige Zuzahlung) by Corning to the free capital reserves of VIA pursuant to Section 272(2) No. 4 of the German Commercial Code (HGB). It is hereby clarified that the payment obligation of Corning pursuant to Section 2.4 shall be considered as a voluntary share premium (schuldrechtliches Agio) and not as a corporative share premium (korporatives Agio).

 

Section 3.                                           Representations and Warranties of VIA. VIA represents and warrants to Corning by way of an independent guarantee irrespective of fault in the meaning of § 311 German Civil Code that the statements in Section 3.1 through Section 3.18 are true and correct as of the date hereof, except for the statements set forth in Sections 3.2, 3.4, 3.7 and 3.12, which will be true and correct as of the respective dates and event(s) referenced therein, (the “VIA Guarantees”), whereby the VIA Guarantees in Section 3.1 through Section 3.4 and Sections 3.11 and 3.12 are considered as “VIA Fundamental Guarantees”:

 

3.1.                            Organization. VIA is a stock corporation duly organized, validly existing and in good standing under the laws of Germany and has all requisite corporate power and authority to own and lease its properties, to carry on its business as presently conducted and as proposed to be conducted by it and to carry out the transactions contemplated by this Agreement. VIA is duly qualified as a foreign corporation and is in good standing in all such jurisdictions in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that any failure to be so qualified would not materially and adversely affect the financial condition, results of operations, assets or liabilities of VIA.

 

3.2.                            Capitalization. Immediately prior to the Closing and without giving effect to the IPO or the issuance of the Corning Shares, the sole holders and beneficial owners of VIA’s outstanding share capital are the persons set forth in the Preamble.

 

3.3.                            Authorization of this Agreement. The execution, delivery and performance by VIA of this Agreement as well as the issuance of the Corning Shares by VIA have been duly authorized by all requisite corporate action of VIA. VIA has duly authorized, executed and delivered this Agreement, and this Agreement constitutes the valid and binding obligation of VIA, enforceable in accordance with its terms (except as enforceability may be limited by (x) applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting the enforcement of creditors’ rights generally and (y) general equitable principles). The execution, delivery and performance of this Agreement, the issuance and delivery of the Corning Shares, and compliance with the provisions hereof by VIA do not and will not, with or without the passage of time or the giving of notice or both, violate, conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute a default (or give rise to any right of termination, cancellation or acceleration) under, or result in the creation of any lien, security interest, charge or encumbrance upon any of the properties

 

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or assets of VIA or the articles of association of VIA (collectively, the “Organizational Documents”), or any provision of law, statute, rule or regulation or any ruling, writ, injunction, order, judgment or decree of any court, administrative agency or other governmental body naming VIA.

 

3.4.                            Corning Shares. The Corning Shares, at the time the corresponding increase of VIA’s registered share capital has been registered with the commercial register, will be (i) validly issued and outstanding, fully paid and non-assessable, (ii) not subject to preemptive or any other similar rights of the shareholders of VIA or others, and (iii) be free and clear of any pledges, encumbrances, attachments or other third-party rights.

 

3.5.                            No Governmental Consent or Approval Required. No authorization, consent, approval or other order of, declaration to, or filing with, any governmental agency or body is required to be made or obtained by VIA for or in connection with the valid and lawful authorization, execution and delivery by VIA of this Agreement or for or in connection with the valid and lawful authorization, issuance, sale and delivery of the Corning Shares, except any filings and registrations to be made under the German Stock Corporation Act in connection with the issuance of the Corning Shares and exempted filings under applicable U.S. federal and state securities laws, which are not required to be made until after the Closing and which shall be made on a timely basis.

 

3.6.                            Financial Statements. The audited consolidated financial statements of VIA GmbH for the fiscal year 2017 ending December 31, 2017 and the unaudited consolidated financial statements of VIA GmbH for the fiscal year 2018 ending December 31, 2018, attached as Annex 3.6, were prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board as of the relevant date and fairly present in all material aspects the consolidated financial condition and results of operations of the Group Companies as of the relevant date. VIA shall provide the audited consolidated financial statements of VIA GmbH for the fiscal year 2018 ending December 31, 2018 prior to the Closing Date to Corning and such audited consolidated financial statements will replace the unaudited consolidated financial statements of VIA GmbH for 2018 for purposes of the VIA Guarantee set forth in this Section 3.6.

 

3.7.                            Registration Statement. The Registration Statement, as of the date when it is declared effective by the SEC, will conform in all material respects to the requirements of the U.S. Securities Act and the rules and regulations thereunder and as of such date will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. The preliminary prospectus contained in the Registration Statement as of the date hereof does not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they are made, not misleading. The Final Prospectus, (A) at the time of filing of the Final Prospectus pursuant to Rule 424(b) under the U.S. Securities Act and (B) on the Closing Date, will conform in all material respects to the requirements of the U.S. Securities Act and the rules and regulations thereunder and will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they are made, not misleading. “Registration Statement” means the registration statement of VIA on Form F-1, as amended, including any prospectus filed and to be filed pursuant to Rule 424 under the U.S. Securities Act, and any free writing prospectuses, relating to the IPO. “Final Prospectus” means the prospectus forming part of the Registration Statement which VIA shall file pursuant to Rule 424 under the U.S. Securities Act that discloses the public offering price, other information included pursuant to Rule 430A under the U.S. Securities Act and other final terms of the Ordinary Shares and the ADSs and otherwise satisfies Section 10(a) of the U.S. Securities Act.

 

3.8.                            Non-Contravention. The Group Companies are not in violation or default in any material respect of any provision of the Organizational Documents or of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound, or, to the Knowledge of VIA, of any provision of any statute, rule or regulation applicable to any Group Companies. The execution, delivery and performance of this Agreement and the consummation of the transactions

 

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contemplated hereby will not result in any material violation or constitute, with or without the passage of time and giving of notice, either (i) a default in any material respect of any such instrument, judgment, order, writ or decree or (ii) an event that results in the creation of any material lien, charge or encumbrance upon any material assets of any of the Group Companies or the suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, or authorization applicable to any of the Group Companies.

 

3.9.                            No Registration. Assuming the accuracy of the representations and warranties of Corning in Section 4, the offering, issuance and sale of the Corning Shares to Corning is exempt from registration requirements under the U.S. Securities Act pursuant to Section 4(a)(2) thereof.

 

3.10.                     Investment Company Act. VIA is not and, after giving effect to the offering and sale of the ADSs in the IPO and the Corning Shares pursuant hereto and the application of the proceeds thereof, will not be an “investment company” as defined in the U.S. Investment Company Act of 1940, as amended.

 

3.11.                     Organization, Authority and Qualification of the Group Companies.

 

(a)                                 Each Group Company is a legal entity duly organized, validly existing and in good standing (to the extent such concepts are recognized under applicable law) under the laws of its jurisdiction of organization and has all requisite corporate power and authority to own and lease its properties, to carry on its business as presently conducted and as proposed to be conducted by such Group Company and to carry out the transactions contemplated by this Agreement.

 

(b)                                 Each Group Company is in good standing in all such jurisdictions in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that any failure to be so qualified would not materially and adversely affect the consolidated financial condition, results of operations, assets or liabilities of the Group Companies.

 

(c)                                  There are no current insolvency, bankruptcy, liquidation or similar proceedings in respect of any of the Group Companies and no such proceedings have been threatened in writing against any of the Group Companies as of the Signing Date, and, to the Knowledge of VIA, no event has occurred which, under applicable law, would be reasonably likely to require or justify the commencement of or application for such proceedings.

 

(d)                                 The organizational documents of each Group Company are in full force and effect and no Group Company is in material violation of any of the provisions of its organizational documents.

 

3.12.                     Capitalization; Ownership.

 

(a)                                 The statements in the Preamble regarding the ownership in the shares of the Group Companies are true and correct. As of Closing, VIA will be the sole shareholder of VIA GmbH.

 

(b)                                 There are no options, warrants, convertible securities, or other rights, agreements, arrangements or commitments relating to the capital of any of the Group Companies obligating any of the Group Companies to issue or sell, or make payments with respect to, the capital of any of the Group Companies.

 

(c)                                  All shares in any of the Group Companies are (i) validly issued and outstanding, fully paid and non-assessable, (ii) not subject to preemptive or any other similar rights of the shareholders of VIA or others, and (iii) are free and clear of any pledges, encumbrances, attachments or other third-party rights.

 

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(d)                                 The contributions towards the shares in the Group Companies have been fully paid up and have not been repaid in whole or in part. There are no obligations of any of the shareholders in any of the Group Companies to make additional contributions or subsidiary payments or to refund any amounts paid.

 

(e)                                  The current articles of association of the Group Companies are included in Annex 3.12(e). No shareholders’ resolutions have been adopted which change or modify the articles of association of the Group Companies.

 

(f)                                   None of the Group Companies own any shares or participation in any other company or legal entity (other than the Group Companies) and none of the Group Companies has entered into the obligation to acquire such shares or participation.

 

(g)                                  No Group Company is party to any enterprise agreements within the meaning of §§ 291, 292 of the German Stock Corporation Act, any silent partnership agreements, or any similar agreements which would entitle a third party to participate in the profits or revenues or to exercise control of any of the Group Companies.

 

3.13.                     Litigation. Except as set forth in Annex 3.13, as of the Signing Date, none of the Group Companies is involved in any lawsuit, arbitration, administrative or other proceedings pending or, to the Knowledge of VIA, threatened by or against it before any state court, arbitration tribunal or governmental agency.

 

3.14.                     Compliance with Laws.

 

(a)                                 Since their organization, the Group Companies have conducted their business and have used their assets in accordance in all material respects with all applicable material laws (including applicable laws regulating competition) and governmental orders applicable to the Group Companies and none of the Group Companies is in material violation of any such laws (including applicable laws regulating competition) or such governmental orders and no event has occurred or exists that (with or without notice or lapse of time) would constitute or result in a material violation of any such laws or such governmental orders. There is no outstanding governmental order imposed upon any of the Group Companies or any of their respective assets that would have or would reasonably be expected to have, individually or in the aggregate, a material adverse effect.

 

(b)                                 None of the Group Companies or, to the Knowledge of VIA, none of their directors, officers or employees acting on behalf of any of the Group Companies have used any corporate or other funds for unlawful contributions, payments, gifts, or entertainment, or made any unlawful expenditures relating to political activity to government officials to assist any of the Group Companies in obtaining or retaining business or to other persons or established or maintained any unlawful funds or funds unrecorded in the books of any of the Group Companies, in each case which results in a violation of the Foreign Corrupt Practices Act of 1977, as amended, or any other applicable anti-bribery/anti-corruption law. To the Knowledge of VIA, none of the Group Companies have accepted or received any contributions, payments, gifts or expenditures in violation of applicable law.

 

(c)                                  The Group Companies have reasonable procedures to ensure that the officers, directors and employees of the Group Companies comply with applicable anti-corruption law.

 

(d)                                 None of the Group Companies or, to the Knowledge of VIA, none of its directors, officers or employees acting on behalf of any of the Group Companies is or has been the subject of any investigation, inquiry or enforcement proceedings by any governmental, administrative or regulatory body or any customer regarding any offence or alleged offence under applicable anti-corruption law, no such investigation, inquiry or proceedings are pending or have been threatened and there are no circumstances likely to give rise to any such material investigation, inquiry or proceedings.

 

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(e)                                  The Group Companies have complied in all material respects with all (employment) obligations towards the employees of the Group Companies applicable by law, collective agreements or individual agreements in all material respects.

 

3.15.                     Permits.

 

(a)                                 The Group Companies hold all material permits and other material public law approvals which are required under applicable law in order to operate and conduct their business as currently operated and conducted and all such permits and approvals are valid and subsisting in all material respects. As per the Signing Date, no such permit and other public law approval has been cancelled or revoked, and, to the Knowledge of VIA, no such cancellation or revocation has been threatened. The Group Companies conduct their respective business in compliance with all material provisions of such permits or public law approvals.

 

(b)                                 None of the Group Companies has received, has been granted or has applied for any state aids and subsidies.

 

3.16.                     Data and Privacy Protection.

 

(a)                                 Except as set forth in Annex 3.16(a), since their foundation each of the Group Companies has complied in all material respects with (i) all applicable laws concerning personal information, data security, cyber security, data privacy, (ii) its written privacy policies relating to the use, collection, storage, disclosure and transfer of any personal information and (iii) any contractual obligations that govern the use, collection, storage, disclosure and transfer of any personal information. No action is pending or, to the Knowledge of VIA, threatened against any of the Group Companies resulting from the collection, use, disclosure, protection or security of personal information by any Group Company.

 

(b)                                 The Group Companies have taken commercially reasonable steps to ensure that each third party that provides a Group Company with personal information has collected and provided that personal information in all material respects consistent with applicable laws, their own written privacy policies, and their usage and sharing rights.

 

(c)                                  Since their formation, to the Knowledge of VIA, the Group Companies have not suffered a security breach that has resulted in the loss of personal information.

 

3.17.                     Intellectual Property.

 

(a)                                 The intellectual property of the Group Companies, which includes for purposes of this Section 3.17 any software rights, together with the rights to use intellectual property pursuant to a contract providing for licenses of intellectual property from or to any of the Group Companies, excluding licenses to customers and end users granted in the ordinary course of business, constitutes all intellectual property that is used in or necessary for the conduct of the business of the Group Companies as currently conducted.

 

(b)                                 Except as set forth in Annex 3.17(b), no action is pending or, to the Knowledge of VIA, threatened against any of the Group Companies alleging infringement, violation, misappropriation or misuse by any of the Group Companies of any intellectual property of any person. To the Knowledge of VIA, the conduct of the business as currently conducted by the Group Companies does not infringe, violate, misappropriate or misuse any intellectual property of any person. To the Knowledge of VIA, none of the intellectual property of any of the Group Companies is infringed, violated, misused or misappropriated by any person.

 

3.18.                     Information in Data Room. VIA has compiled the information provided to Corning in the data room in good faith.

 

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3.19.                     Knowledge of VIA. “Knowledge of VIA” means (x) the actual knowledge of Jürgen Eichner (CEO) or Daniel Jürgens after due inquiry of their direct reports or (y) the actual knowledge of Jasmin Wörle (CMO), Christine Albert (Legal and Patents) or Howard Ho (GM-Suzhou).

 

Section 4.                                           Representations and Warranties of Corning. Corning represents and warrants to VIA by way of an independent guarantee irrespective of fault in the meaning of § 311 German Civil Code that the statements in Section 4.1 through Section 4.8 are true and correct as of the date hereof (the “Corning Guarantees”):

 

4.1.                            Purchase for Investment. Corning is acquiring the Corning Shares for its own account, for investment and not for, with a view to, or in connection with, any distribution or public offering thereof within the meaning of the U.S. Securities Act.

 

4.2.                            Unregistered Securities. Corning understands that the Corning Shares will not be certificated in one single share certificate available to Corning, but moreover, will be certificated, together with the other outstanding ADSs, in a global share certificate. Corning further understands that, except as provided in Section 5.3, the Corning Shares will not be registered under the U.S. Securities Act or any U.S. state securities law, by reason of their issuance in a transaction exempt from the registration requirements of the U.S. Securities Act and such rules and regulations thereunder, that the Corning Shares must be held indefinitely unless they are subsequently registered under the U.S. Securities Act and such state securities laws or a subsequent disposition thereof is exempt from registration, and that appropriate stop transfer instructions may be issued with respect to the Corning Shares. Corning further understands that such exemption depends upon, among other things, the bona fide nature of Corning’s investment intent expressed herein.

 

4.3.                            Status of Investor. Corning has not been formed for the specific purpose of acquiring the Corning Shares pursuant to this Agreement. Corning understands the term “accredited investor” as used in Regulation D promulgated under the U.S. Securities Act and represents and warrants to VIA that Corning is an “accredited investor” for purposes of acquiring the Corning Shares purchasable by it hereunder.

 

4.4.                            Knowledge and Experience; Economic Risk. Corning has sufficient knowledge and experience in business and financial matters and with respect to investment in securities of companies similar to the Company so as to enable it to analyze and evaluate the merits and risks of the investment contemplated hereby and is capable of protecting its interest in connection with this transaction. Corning is able to bear the economic risk of such investment, including a complete loss of the investment.

 

4.5.                            Access to Information.                    Corning acknowledges that it and its representatives have had the opportunity to ask questions and receive answers from officers and representatives of VIA concerning VIA and its business and the transactions contemplated by this Agreement and to obtain any additional information which VIA has advised Corning that it possesses or can acquire that is necessary to verify the accuracy of the information regarding VIA herein set forth or otherwise desired by Corning in connection with Corning’s purchase of the Corning Shares purchasable by it hereunder.

 

4.6.                            Place of Business. Corning has listed its principal place of business or registered address under its name on the signature page hereto.

 

4.7.                            Authorization of this Agreement. Corning has duly authorized, executed and delivered this Agreement, and this Agreement constitutes the valid and binding obligation of Corning, enforceable against Corning in accordance with its terms (except as enforceability may be limited by (x) applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting

 

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the enforcement of creditors’ rights generally and (y) general equitable principles (regardless of whether enforceability is considered in a proceeding in equity or at law)).

 

4.8.                            No Additional Warranties or Representations; Due Diligence. Corning, on behalf of itself and its affiliates, acknowledges that no Group Company nor any other person has made any representation or warranty, expressed or implied, as to the accuracy or completeness of any information regarding any Group Company, the Corning Shares or the business of the Group Companies, which has been communicated, furnished or made available to Corning or its equityholders, members, managers, partners, officers, directors, employees, agents, attorneys, accountants, advisors and representatives (collectively, “Representatives”), except as expressly set forth in Section 3. No Group Company nor any other person shall have or be subject to any liability to Corning or any other person resulting from the distribution to Corning or its Representatives, or any of Corning’s or its Representatives’ use of, any such information, documents or material made available to any of them in records stored on computer disks, in online or physical “data rooms,” provided during management presentations or in any other forms in expectation of the transactions contemplated by this Agreement except as expressly set forth in, and subject to the limitations of, Section 9 of this Agreement. Corning, on behalf of itself and its affiliates acknowledges and agrees that neither it nor any of its Representatives has relied, and none of such persons are relying, upon any statement, warranty or representations (whether written or oral) not made in Section 3. Corning and its Representatives have received from or on behalf of the Group Companies certain estimates, budgets, forecasts, plans and financial projections (“Forward-Looking Statements”), and Corning, on behalf of itself and its affiliates, acknowledges that (i) there are uncertainties inherent in making Forward-Looking Statements and (ii) it is familiar with such uncertainties and is taking full responsibility for making its own evaluation of the adequacy and accuracy of all Forward-Looking Statements so furnished to it and its Representatives (including the reasonableness of the assumptions underlying Forward-Looking Statements where such assumptions are explicitly disclosed). Except as expressly set forth in Section 3, neither the Group Companies nor any other person is making any representation or warranty with respect to, or shall have or be subject to any liability to Corning, or any other person resulting from, the distribution to any of Corning or its Representatives, or their use of, Forward-Looking Statements.

 

Section 5.                                           Covenants.

 

5.1.                            NYSE Listing. VIA shall use its commercially reasonable efforts to effectuate the IPO and to cause the ADSs subject to the IPO and constituting the Corning Shares to be listed on the New York Stock Exchange at the Closing, subject to official notice of issuance. VIA shall inform Corning promptly after the occurrence of each of the following actions: (i) any determination by VIA to abandon the IPO; (ii) the date on which the Registration Statement is initially submitted confidentially to the SEC; (iii) the date on which the Registration Statement initially is publicly filed with the SEC; (iv) the date on which the preliminary prospectus supplement containing a bona fide price range relating to the IPO is filed with the SEC; and (v) the date on which the SEC declares the Registration Statement effective under the Securities Act.

 

5.2.                            Removal of Restrictions. It is understood and agreed by VIA that any stop transfer instructions referred to in Section 4.2 issued by VIA shall be removed, upon written request by Corning to VIA (and at Corning’s cost), and VIA shall take such actions to effectuate such removal as may be required by the Depositary, at any time at which the Corning Shares (i) are registered under the U.S. Securities Act and sold pursuant to such registration, (ii) are sold or to be sold under Rule 144 under the U.S. Securities Act (“Rule 144”), or otherwise in a transaction exempt from, or not subject to, the registration requirements of the U.S. Securities Act, (iii) may be sold or otherwise transferred without registration under the U.S. Securities Act and (iv) from and after the first anniversary after the Closing Date, provided that, in each such case, Corning provides customary representations reasonably acceptable to VIA in relation thereto, including in the case of clause (iv), that Corning is not an “affiliate” of VIA within the meaning of Rule 144.

 

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5.3.                            Registration Rights.

 

(a)                                 If at any time following the date of this Agreement that any Registrable Securities (as defined below) remain outstanding and are not freely tradable under Rule 144 (A) there are not one or more effective registration statements under the U.S. Securities Act covering all of the Registrable Securities and (B) VIA proposes for any reason to register any Ordinary Shares or ADSs under the U.S. Securities Act (other than pursuant to a registration statement on Form F4 or Form F-8 (or a similar or successor form)) with respect to an offering by VIA for its own account or for the account of any of its holders of Ordinary Shares or ADSs, it shall at each such time promptly give prompt written notice to Corning of its intention to do so and, to the extent permitted under the provisions of Rule 415 under the U.S. Securities Act, include in such registration all Registrable Securities with respect to which Corning has requested inclusion therein within fifteen (15) Business Days after receipt of VIA’s notice (or five (5) Business Days if VIA states in such written notice or gives telephonic notice to Corning with written confirmation to follow promptly thereafter, stating that (i) such registration will be on Form F3 and (ii) such shorter period of time is required because of an earlier planned filing date) (a “Piggyback Registration”). Such notice shall offer Corning the opportunity to register such number of shares of Registrable Securities as Corning may request and shall indicate the intended method of distribution of such Registrable Securities.

 

(b)                                 If the managing underwriter of any underwritten offering shall inform VIA by letter of its belief that the number of Registrable Securities requested to be included in such registration pursuant to this Section 5.3, when added to the number of other securities to be offered in such registration by VIA, would materially adversely affect such offering, then VIA shall include in such registration, to the extent of the total number of securities which VIA is so advised can be sold in (or during the time of) such offering without so materially adversely affecting such offering, securities in the following priority: (x) first, all ADSs or Ordinary Shares or securities convertible into, or exchangeable or exercisable for, ADSs or Ordinary Shares that VIA proposes to register for its own account; and (y) second, the Registrable Securities and any other securities requested to be included that are owned by all holders thereof requesting inclusion, pro rata based on the respective amounts of Registrable Securities and other securities held by Corning and such other holders.

 

(c)                                  Notwithstanding the foregoing, (A) if such registration involves an underwritten public offering, Corning must sell its Registrable Securities to, if applicable, the underwriter(s) at the same price and subject to the same underwriting discounts and commissions that apply to the other securities sold in such offering and subject to Corning entering into customary underwriting documentation for selling stockholders in an underwritten public offering, and (B) if, at any time after giving written notice of its intention to register any Registrable Securities and prior to the effective date of the registration statement filed in connection with such registration, VIA shall determine for any reason not to cause such registration statement to become effective under the U.S. Securities Act, VIA shall deliver written notice to Corning and, thereupon, shall be relieved of its obligation to register any Registrable Securities in connection with such registration.

 

(d)                                 For purposes of this Agreement “Registrable Securities” means (i) the Corning Shares and (ii) any other securities issued or issuable with respect to or in exchange for the Corning Shares, whether by way of a stock dividend or distribution, stock split or similar transaction, or by merger, charter amendment, or otherwise; provided, that, a security shall cease to be a Registrable Security (and any obligation of VIA with respect thereto shall terminate) for so long as (a) a registration statement with respect to the sale of such Registrable Securities is declared effective by the SEC under the U.S. Securities Act and such Registrable Securities have been disposed of by the holder thereof in accordance with such effective Registration Statement, (b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) from and after the second anniversary of the Closing Date, such securities are eligible for resale pursuant to Rule 144 without volume or manner-of-sale restrictions and without current public information.

 

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5.4.                            Market Stand-Off. Corning agrees that from the Closing Date and until 180 days after the date of the Final Prospectus, upon written request by the managing underwriter or underwriters of the IPO, and subject to agreement by VIA’s directors, executive officers and other holders of Ordinary Shares or ADSs to enter into substantially the same undertakings (subject to the proviso in the last sentence of this Section 5.4), without the consent of VIA, Corning shall not: (i) offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, make any short sale or otherwise transfer or dispose of, directly or indirectly, any Corning Shares or any securities convertible into, exercisable or exchangeable for or that represent the right to receive Corning Shares; (ii) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Corning Shares, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of the Corning Shares or such other securities, in cash or otherwise; (iii) make any demand for, or exercise any right with respect to, the registration of Corning Shares or any security convertible into or exercisable or exchangeable for Corning Shares; or (4) publicly disclose the intention to do any of the foregoing. Notwithstanding the foregoing, Corning shall be entitled to any exceptions to such restrictions which shall be granted to any other party to such undertakings; provided that Corning’s entitlement to any such exception shall not apply to any exception that is granted solely and exclusively to Mr. Jürgen Eichner.

 

5.5.                            Potential Private Placement. If the Closing shall not have occurred as of the IPO Deadline (as defined below), then, from the IPO Deadline and until 6 month of the IPO Deadline, Corning shall have the option, but not the obligation, to engage in good faith negotiations with VIA regarding a potential equity investment in VIA (or one of its affiliates) by Corning based on an investment amount by Corning of USD 20,000,000 (in words: US Dollars twenty million) and assuming a pre-money valuation of VIA of USD 400,000,000 (in words: US Dollars four-hundred million).

 

Section 6.                                           Conditions Precedent to Closing by Corning. The obligation of Corning to subscribe the Corning Shares and pay the Purchase Amount at the Closing is subject to satisfaction (or waiver by Corning) of the following conditions precedent at or before the Closing (the “Corning Closing Conditions”):

 

6.1.                            Representations and Warranties Correct. Each of the representations and warranties of VIA contained in Section 3 shall be true and accurate in all material respects on and as of the Closing with the same force and effect as if they had been made at the Closing, except for (a) those representations and warranties that address matters only as of a particular date (which shall remain true and correct as of such particular date), with the same force and effect as if they had been made at the Closing, and (b) those representations and warranties which (i) are qualified as to materiality or (ii) provide that the Company’s failure to comply with such representation or warranty would not result in a material adverse effect shall be true and accurate in all respects as of the Closing.

 

6.2.                            Closing of IPO. The IPO shall have closed and the underwriters shall have purchased from VIA, concurrently with the subscription of the Corning Shares by Corning hereunder, the number of ADSs at the price per share to the public set forth on the cover of the Final Prospectus (less any underwriting discounts or commissions) on or before September 30, 2019 (the “IPO Deadline”).

 

6.3.                            NYSE Listing. The ADSs subject to the IPO and constituting the Corning Shares shall have been approved for listing on the New York Stock Exchange, subject to official notice of issuance.

 

6.4.                            Commercial Agreements.

 

(a)                                 The Commercial Agreements shall not have been terminated in accordance with their terms (i) by VIA (other than a termination pursuant to a material breach of such Commercial

 

12

 

Agreements by Corning) or (ii) by Corning due to a breach of a Commercial Agreement by the respective Group Companies; or

 

(b)                                 The respective Group Companies have not materially breached any obligations of the Commercial Agreements, unless such breach is capable of being cured within the respective cure period and the respective Group Companies are working diligently to cure such breach.

 

6.5.                            Qualifications. All authorizations, approvals, or permits, if any, of any governmental authority or regulatory body of the United States or of any state that are required in connection with the lawful issuance of the Corning Shares pursuant to this Agreement shall be duly obtained and effective as of the Closing.

 

6.6.                            Waiver by Corning. Corning is entitled to waive any of the Corning Closing Conditions other than the condition set forth in Section 6.2 by written notice to VIA, such waiver to be declared until one month after the expiration of the IPO Deadline at the latest.

 

Section 7.                                           Conditions Precedent to Closing by VIA.

 

The obligation of VIA to exclusively admit Corning to subscribe the Corning Shares and to issue the Corning Shares to Corning at the Closing is subject to satisfaction (or waiver by VIA) at or before the Closing of the following conditions precedent (the “VIA Closing Conditions”)

 

7.1.                            Representations and Warranties Correct. Each of the representations and warranties made in Section 4 by Corning shall be true and correct in all material respects on and as of the Closing with the same force and effect as if they had been made at the Closing.

 

7.2.                            Closing of IPO. The IPO shall have closed and the underwriters shall have purchased from VIA, concurrently with the subscription of the Corning Shares by Corning hereunder, the number of ADSs at the price per share to the public set forth on the cover of the Final Prospectus (less any underwriting discounts or commissions) on or before the IPO Deadline.

 

7.3.                            Commercial Agreements. The Commercial Agreements shall not have not been terminated in accordance with their terms by Corning, except where such termination by Corning is due to the uncured breach of a Commercial Agreement by the respective Group Companies.

 

7.4.                            Waiver by VIA. VIA is entitled to waive any of the VIA Closing Conditions other than the condition set forth in Section 7.2 by written notice to Corning, such waiver to be declared until one month after the expiration of the IPO Deadline at the latest.

 

Section 8.                                           Fees and Expenses. Each party to this Agreement shall bear all of its own fees and expenses incurred in connection with the preparation and negotiation of this Agreement and the consummation of the transactions contemplated hereby, including all fees of such party’s legal counsel; provided, that the notary costs and commercial register fees incurred in connection with the issuance of the Corning Shares shall be borne by VIA.

 

Section 9.                                           Remedies.

 

9.1.                            Rights of Corning prior to Closing. In case any one or more of the representations set out in Section 3 or any of the covenants set out in Section 5 have been breached by VIA prior to Closing and first identified by Corning prior to Closing, Corning may either (i) enforce its right under Section 5 or (ii) rescind this Agreement by notice vis-a-vis VIA with the effect for all parties and no party shall have any obligation or liability deriving from this Agreement, but Corning shall not be entitled to claim for damages as a result of any such breach of the respective representations or covenant.

 

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9.2.                            Rights of Corning after Closing. In case any one or more of the representations set out in Section 3 have been breached by VIA prior to Closing and first identified by Corning after the Closing, Corning may first demand VIA to cure the breach of the respective representation by way of specific performance. If specific performance (i) is not rendered by VIA within a period of one month after the breach has been notified by Corning in writing to VIA or (ii) is in Corning’s reasonable good faith opinion insufficient to compensate Corning for its reasonable and documented Losses suffered as a result of the breach of the representation, VIA shall pay to Corning monetary damages in accordance with and subject to the limitations of the provisions set forth in this Section 9. Under no circumstances, however, shall VIA have any obligation to pay damages to Corning if and to the extent such payment would violate the capital preservation provisions of § 57 German Stock Corporation Act, as applicable to VIA:

 

(a)                                 VIA shall pay monetary damages to Corning for the Losses incurred by Corning, whereby for the purposes of this Agreement “Losses” means only (x) direct damages and (y) indirect or consequential damages or loss of profits, each solely to the extent that such damages or losses are the reasonably foreseeable result of the breach of the VIA Guarantees and excludes (i) all indirect or consequential damages or loss of profits not recoverable pursuant to the immediately preceding clause 9.2(a)(y), (ii) punitive or exemplary damages, (iii) diminution in the value of the Corning Shares, (iv) any losses computed on the basis of, or related to, the value of the Corning Shares and/or VIA, (v) damages/losses to the good will of VIA, (vi) lost opportunities, (vii) frustrated costs and expenses, and (viii) internal costs incurred by Corning.

 

(b)                                 VIA shall not be obligated to pay monetary damages, if and to the extent that (i) the matter to which Corning’s claim relates has been reserved for in the audited financial statements 2017 of VIA optronics GmbH, (ii) Corning or any of its affiliates after Closing has participated in causing such claim pursuant to § 254 (1) German Civil Code or has failed to comply with its duty to mitigate damages pursuant to § 254 (2) German Civil Code or (iii) the claim results from, or is increased by, the passing of, or any change in any law, statute, ordinance, rule, regulation, common law rule or administrative practice of any government, governmental department, agency or regulatory body after the date of this Agreement.

 

(c)                                  No liability to pay monetary damages shall attach to VIA under this Section 9.2 based on breaches of the VIA Guarantees, if and to the extent (i) an individual claim or series of related claims of Corning under this Section 9.2 relate to Losses not exceeding an amount of $50,000.00 (the “De Minimis Amount”) and (ii) the individual claim or series of related claims (taken together) — provided that events which result in Losses in an amount beneath the De Minimis are not taken into consideration — relate to Losses not exceeding $200,000.00 (the “Basket”) whereby only the Losses, if any, in excess of the Basket shall be compensated.

 

(d)                                 The aggregate liability of VIA for all claims of Corning under this Section 9.2 shall (i) as regards the VIA Guarantees, other than the VIA Fundamental Guarantees, in no event exceed the amount of $3,000,000.00 and (ii) as regards the VIA Fundamental Guarantees, including any liability on account of the other VIA Guarantees, in no event exceed the amount of the Purchase Price (the “Liability Cap”).

 

(e)                                  In case damages have been incurred on the level of any of the Group Companies and such damages qualify as Losses for purposes of this Agreement, the amount of any such Loss to be compensated to Corning shall be calculated by the amount of the damages incurred by the applicable Group Company giving rise to such Loss multiplied by the applicable indirect ownership stake of Corning represented by the Corning Shares as of the Closing Date after giving effect to the consummation of the IPO.

 

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(f)                                   All claims of Corning under this Section 9.2 on account of breaches of the VIA Guarantees shall become time-barred (i) as regards the VIA Guarantees, other than the VIA Fundamental Guarantees, eighteen (18) months after the Closing Date and (ii) as regards the VIA Fundamental Guarantees three (3) years after the Closing Date.

 

(g)                                  All claims of Corning under this Section 9.2 on account of breaches of the VIA Guarantees shall be excluded to the extent that the underlying facts (i) have been reasonably identified on the face of the Annexes pertaining to this Agreement and any VIA Guarantee or (ii) are described in the Registration Statement. Furthermore, Section 442 of the German Civil Code and Section 377 of the German Commercial Code shall not apply.

 

9.3.                            Remedies after Closing. After the Closing Date each party in case of any breach of covenants or representations under this Agreement may proceed to protect and enforce its rights under this Agreement either by suit or by action at law, including, but not limited to, an action for damages as a result of any such breach of the representation or covenant; provided, however, that Corning shall be entitled to claim damages due to a breach of VIA of one or more of the representations set out Section 3 only in accordance with Section 9.2.

 

9.4.                            No other Remedies. This Section 9 provides the sole remedies of the parties for breaches of representations or covenants under this Agreement. Any further claims and remedies against a party, irrespective of which nature, amount or legal basis, are hereby expressly waived and excluded, in particular, without limitation, claims under pre-contractual fault (§§ 311 para. 2 and 3, 241 para. 2 German Civil Code), for breach of contract on the basis of statutory warranty provisions or tort as well as any and all other claims, which could, due to a rescission, except for the rights set forth in Section 9.1, challenging, reduction of the Purchase Amount or any other reasons, result in the termination, invalidity or winding up of this Agreement, an amendment of its content or a repayment or reduction of the Purchase Amount, unless such claim is based on willful act of or fraudulent misrepresentation by such party.

 

Section 10.                                    Entire Agreement; Effect on Prior Documents. This Agreement and the other documents referred to herein or delivered pursuant hereto contain the entire agreement among the parties with respect to the transactions contemplated hereby and supersede all prior negotiations, commitments, agreements and understandings among them with respect thereto. Subject to Section 21(b) below, the terms of this Agreement, including the names of the parties hereto, may be described by VIA in the Registration Statements and otherwise as required by the U.S. Securities Act, the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

 

Section 11.                                    Notices. All notices, requests, consents and other communications hereunder (“Notices”) to any party shall be contained in a written instrument addressed to such party at the address set forth below or such other address as may hereafter be designated in writing by the addressee to the addressor listing all parties and shall be deemed given (a) when delivered in person or duly sent by fax showing confirmation of receipt, (b) three days after being duly sent by first class mail postage prepaid (other than in the case of Notices to or from any non-U.S. resident, which Notices must be sent in the manner specified in clause (a) or (c)), or (c) two days after being duly sent by DHL, Federal Express or other recognized express international courier service:

 

(a)                                 if to VIA and/or VIA GmbH, to:

 

VIA Optronics GmbH

Lettenfeldstraße 15, 90592 Schwarzenbruck, Germany

Attn.: Daniel Jürgens, CFO

Email: DJuergens@via-optronics.com

 

15

 

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

 

Dechert LLP

1095 Avenue of the Americas

New York, New York 10036-6797

Attn: Federico Pappalardo, Esq.

          David Rosenthal, Esq.

          Gregory Schernecke, Esq.

          Fax: (212) 698-0416

 

(b)                                 if to Corning, to:

 

Corning Research & Development Corporation

One Riverfront Plaza

Corning, New York 14831

Attn: Corporate Secretary

 

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

 

Hogan Lovells International LLP

Karl-Scharnagl-Ring 5

80539 Munich, Germany

Attn: Volker Geyrhalter, Esq.

Fax: +49 89 29012 222

 

Section 12.                                    Amendments; Waivers. This Agreement may be amended, and compliance with the provisions of this Agreement may be omitted or waived, only by the written agreement of VIA and Corning.

 

Section 13.                                    Rescission Rights.

 

(a)                                 If the Corning Closing Conditions have not been fulfilled or waived by Corning on or before the IPO Deadline, Corning is entitled in its own discretion to withdraw (zurücktreten) from this Agreement within thirty (30) Business Days after the expiry of the IPO Deadline by written declaration to VIA.

 

(b)                                 If the VIA Closing Conditions have not been fulfilled or waived by VIA on or before the IPO Deadline, VIA is entitled in its own discretion to withdraw (zurücktreten) from this Agreement within thirty (30) Business Days after the expiry of the IPO Deadline by written declaration to Corning.

 

(c)                                  In case of a rescission or termination, this Agreement shall terminate except for the provisions set forth in Section 8 (Fees and Expenses), Section 11 (Notices), Section 18  (Governing Law), Section 19 (Venue), Section 21 (Confidentiality) and Section 22 (Final Provisions) which shall continue in further effect. In case of a rescission by VIA pursuant to Section 13(b) above, Section 5.5 (Potential Private Placement) shall continue to apply.

 

Section 14.                                    Counterparts; Facsimile Signatures. This Agreement may be executed in any number of counterparts, each such counterpart shall be deemed to be an original instrument, and all such counterparts together shall constitute but one agreement. Any such counterpart may contain one or more signature pages. This Agreement may be executed and delivered by facsimile, or by email in portable document format (.pdf) and upon such delivery of the signature page by such method will be deemed to have the same effect as if the original signature had been delivered to the other parties.

 

Section 15.                                    Headings. The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.

 

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Section 16.                                    Nouns and Pronouns. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of names and pronouns shall include the plural and vice-versa.

 

Section 17.                                    Corning’s Nomination Right. Corning shall be entitled to nominate an affiliate of Corning to serve as transferee regarding the Corning Shares instead of Corning by written notice to VIA no later than five (5) Business Days prior to the Expected Closing Date (such nominee the “Transferee”). In case Corning makes use of its nomination right pursuant to Section 17, the transfer of the Corning Shares at Closing shall not be effected to Corning but directly to the Transferee.

 

Section 18.                                    Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of the Federal Republic of Germany, to the exclusion of the UN Sales Convention (CISG) without regard to its principles of conflicts of laws.

 

Section 19.                                    Venue. All disputes arising in connection with this Agreement or about its validity will be finally settled by a written arbitral award stating the reasons for the decision rendered by an arbitral tribunal in accordance with the Arbitration Rules of the German Institution of Arbitration e.V. (DIS) and to the exclusion of the jurisdiction of the courts of law. The arbitral tribunal may also render an award on the validity of this arbitration clause, which award will be binding on the courts of law. The place of arbitration will be Munich, Germany. The number of arbitrators will be three (3). The language of the arbitral proceeding will be German.

 

Section 20.                                    Successors and Assigns. This Agreement shall be binding upon, and inure to the benefit of, each of the successors and assigns of the parties hereto and, except as otherwise expressly provided herein, each other person who shall become a registered holder named in a certificate evidencing Corning Shares transferred to such holder by Corning or its permitted transferees, and (except as aforesaid) its legal representatives, successors and assigns.

 

Section 21.                                    Confidentiality; Consent.

 

(a)                                 The Parties mutually undertake to keep the contents of this Agreement secret and confidential vis-à-vis any third party except to the extent that the relevant facts are in the public domain or the disclosure of which is required by law. In the latter case, the Parties shall, however, inform each other prior to such disclosure and shall limit any disclosure to the minimum required. No press release or other public announcement concerning the transactions contemplated by this Agreement shall be made by either Party unless the form and text of such announcement has first been approved by the other Party, except that — if and to the extent a Party is required by law or by applicable stock exchange regulations to make an announcement — it may do so after first consulting with the other Party.

 

(b)                                 VIA is entitled to describe the transaction set forth in the Agreement in the Registration Statement and any other offering documents relating to the IPO, including the name of Corning; provided, that Corning shall consent to such disclosure before such disclosure is initially confidentially submitted to or filed with the SEC and thereafter prior to any material change to such disclosure; provided, however, that any such consent shall not be unreasonably withheld, delayed or conditioned by Corning.

 

Section 22.                                    Final Provisions.

 

(a)                                 VIA GmbH shall guarantee the due performance of all obligations of VIA under this Agreement.

 

(b)                                 “Business Day” for purposes of the Agreement means any day other than a Saturday, Sunday or public holiday on which banks are generally open for business in Munich, Germany and New York, USA.

 

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(c)                                  This Agreement or any of its provisions may be amended, waived or terminated only by written instrument (or in any stricter form required by mandatory law) executed by both Parties and explicitly referring to this Agreement.

 

(d)                                 This Agreement is made in the English language. Any term to which a German translation has been added shall be interpreted throughout this Agreement as having the meaning assigned to it by such German translation. All other English language terms shall be interpreted without specific reference to any meaning attributed to them under English language legal system. With respect to any applicable jurisdiction other than Germany, such term shall be interpreted in accordance with comparative law (rechtsvergleichend) to come as close as possible to the legal meaning of the German term in such other applicable jurisdiction.

 

(e)                                  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

(f)                                   The term “including” means in all instances “including without limitation”. The term “shall” implies a strict liability to take or omit an action.

 

(g)                                  The Exhibits, Annexes and Schedules to this Agreement are an integral part of this Agreement and any reference to this Agreement includes this Agreement and the Exhibits, Annexes and Schedules as a whole.

 

[Remainder of page intentionally left blank]

 

18

 

IN WITNESS WHEREOF, the undersigned have executed this Investment Agreement as of the day and year first written above.

 

	
 
    	
VIA   OPTRONICS AG
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jürgen Eichner
    
	
 
    	
 
    	
Name:   Jürgen Eichner
    
	
 
    	
 
    	
Title:   Member of the Management Board
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Daniel Jürgens
    
	
 
    	
 
    	
Name:   Daniel Jürgens
    
	
 
    	
 
    	
Title:   Member of the Management Board
    

 

 

IN WITNESS WHEREOF, the undersigned have executed this Investment Agreement as of the day and year first written above.

 

	
 
    	
VIA   OPTRONICS GmbH
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jürgen Eichner
    
	
 
    	
 
    	
Name:   Jürgen Eichner
    
	
 
    	
 
    	
Title:   Managing Director
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Daniel Jürgens
    
	
 
    	
 
    	
Name:   Daniel Jürgens
    
	
 
    	
 
    	
Title:   Managing Director
    

 

 

IN WITNESS WHEREOF, the undersigned have executed this Investment Agreement as of the day and year first written above.

 

	
 
    	
CORNING   Research & Development Corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Lawrence D. McRae
    
	
 
    	
 
    	
Name:   Lawrence D. McRae
    
	
 
    	
 
    	
Title:   Vice Chairman & Corporate Development OfficerExhibit 10.4

 

FRAMEWORK AGREEMENT

 

between

 

VIA OPTRONICS GMBH

 

and

 

TOPPAN PRINTING CO., LTD.

 

dated

 

November 30, 2017

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I   DEFINITIONS
    	
1
    
	
 
    	
 
    
	
Section 1.01
    	
Definitions
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.02
    	
Other Defined Terms
    	
5
    
	
 
    	
 
    	
 
    
	
ARTICLE II   OVERVIEW   OF THE TRANSACTION
    	
6
    
	
 
    	
 
    
	
Section 2.01
    	
L/Cs, Competition   Clearance, Spin-off; Share Transfer; Newco Governance
    	
6
    
	
 
    	
 
    	
 
    
	
Section 2.02
    	
Intellectual Property
    	
7
    
	
 
    	
 
    	
 
    
	
Section 2.03
    	
Business Employees
    	
8
    
	
 
    	
 
    	
 
    
	
Section 2.04
    	
Manufacturing Agreement
    	
9
    
	
 
    	
 
    	
 
    
	
Section 2.05
    	
Lease Agreement
    	
9
    
	
 
    	
 
    	
 
    
	
Section 2.06
    	
Bank Guarantee
    	
9
    
	
 
    	
 
    	
 
    
	
Section 2.07
    	
Other Agreements
    	
9
    
	
 
    	
 
    	
 
    
	
Section 2.08
    	
Pre-Closing and Post-Closing   Liabilities
    	
10
    
	
 
    	
 
    	
 
    
	
Section 2.09
    	
Share Purchase Price   Adjustment
    	
10
    
	
 
    	
 
    	
 
    
	
Section 2.10
    	
Further Assurances
    	
11
    
	
 
    	
 
    	
 
    
	
ARTICLE III   CLOSING;   CLOSING DELIVERABLES
    	
11
    
	
 
    	
 
    
	
Section 3.01
    	
Closing
    	
11
    
	
 
    	
 
    	
 
    
	
Section 3.02
    	
Closing Deliverables   and Actions
    	
11
    
	
 
    	
 
    	
 
    
	
ARTICLE IV   REPRESENTATIONS   AND WARRANTIES OF TOPPAN
    	
13
    
	
 
    	
 
    
	
Section 4.01
    	
Organization and   Authority
    	
13
    
	
 
    	
 
    	
 
    
	
Section 4.02
    	
No Conflicts; Consents
    	
13
    
	
 
    	
 
    	
 
    
	
Section 4.03
    	
Legal Proceedings
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.04
    	
Antisocial Forces
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.05
    	
Title to Shares;   Capitalization
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.06
    	
Title to Transferred   Assets
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.07
    	
Condition of   Transferred Assets
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.08
    	
Spin-off
    	
14
    
	
 
    	
 
    	
 
    
	
Section 4.09
    	
Sufficiency of   non-Intellectual Property Assets
    	
15
    
	
 
    	
 
    	
 
    
	
Section 4.10
    	
Intellectual Property
    	
15
    
	
 
    	
 
    	
 
    
	
Section 4.11
    	
Balance Sheet
    	
16
    

 

i

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 4.12
    	
Brokers
    	
16
    
	
 
    	
 
    	
 
    
	
Section 4.13
    	
Exclusive   Representations and Warranties
    	
16
    
	
 
    	
 
    	
 
    
	
ARTICLE V   REPRESENTATIONS   AND WARRANTIES OF VIA
    	
17
    
	
 
    	
 
    
	
Section 5.01
    	
Organization and   Authority
    	
17
    
	
 
    	
 
    	
 
    
	
Section 5.02
    	
No Conflicts; Consents
    	
17
    
	
 
    	
 
    	
 
    
	
Section 5.03
    	
Legal Proceedings
    	
17
    
	
 
    	
 
    	
 
    
	
Section 5.04
    	
Sufficiency of Funds
    	
17
    
	
 
    	
 
    	
 
    
	
Section 5.05
    	
Antisocial Forces
    	
18
    
	
 
    	
 
    	
 
    
	
Section 5.06
    	
Brokers
    	
18
    
	
 
    	
 
    	
 
    
	
Section 5.07
    	
Investigation by VIA
    	
18
    
	
 
    	
 
    	
 
    
	
ARTICLE VI   COVFNANTS
    	
18
    
	
 
    	
 
    
	
Section 6.01
    	
Conduct of Business   before Closing; Maintenance of Transferred IP
    	
18
    
	
 
    	
 
    	
 
    
	
Section 6.02
    	
Access to Information
    	
18
    
	
 
    	
 
    	
 
    
	
Section 6.03
    	
Closing Conditions
    	
19
    
	
 
    	
 
    	
 
    
	
Section 6.04
    	
Third-Person Consents;   Antitrust Approvals
    	
19
    
	
 
    	
 
    	
 
    
	
Section 6.05
    	
Confidentiality
    	
20
    
	
 
    	
 
    	
 
    
	
Section 6.06
    	
Balance Sheet
    	
20
    
	
 
    	
 
    	
 
    
	
Section 6.07
    	
Transferred IP
    	
21
    
	
 
    	
 
    	
 
    
	
Section 6.08
    	
Further Assurances
    	
21
    
	
 
    	
 
    	
 
    
	
ARTICLE VII   CONDITIONS   TO CLOSING
    	
21
    
	
 
    	
 
    
	
Section 7.01
    	
Conditions to   Obligations of Both Parties
    	
21
    
	
 
    	
 
    	
 
    
	
Section 7.02
    	
Conditions to   Obligations of VIA
    	
21
    
	
 
    	
 
    	
 
    
	
Section 7.03
    	
Conditions to   Obligations of Toppan
    	
22
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII   TERMINATION
    	
22
    
	
 
    	
 
    
	
Section 8.01
    	
Termination
    	
22
    
	
 
    	
 
    	
 
    
	
Section 8.02
    	
Effect of Termination
    	
23
    
	
 
    	
 
    	
 
    
	
ARTICLE IX   INDEMNIFICATION
    	
24
    
	
 
    	
 
    
	
Section 9.01
    	
Survival
    	
24
    
	
 
    	
 
    	
 
    
	
Section 9.02
    	
Indemnification by   Toppan
    	
24
    

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Section 9.03
    	
Indemnification by VIA
    	
24
    
	
 
    	
 
    	
 
    
	
Section 9.04
    	
Certain Limitations
    	
25
    
	
 
    	
 
    	
 
    
	
Section 9.05
    	
Indemnification   Procedures
    	
26
    
	
 
    	
 
    	
 
    
	
Section 9.06
    	
Tax Treatment of   Indemnification Payments
    	
27
    
	
 
    	
 
    	
 
    
	
Section 9.07
    	
Exclusive Remedies
    	
28
    
	
 
    	
 
    	
 
    
	
ARTICLE X   MISCELLANEOUS
    	
28
    
	
 
    	
 
    
	
Section 10.01
    	
Expenses
    	
28
    
	
 
    	
 
    	
 
    
	
Section 10.02
    	
Further Assurances
    	
28
    
	
 
    	
 
    	
 
    
	
Section 10.03
    	
Notices
    	
28
    
	
 
    	
 
    	
 
    
	
Section 10.04
    	
Headings
    	
29
    
	
 
    	
 
    	
 
    
	
Section 10.05
    	
Severability
    	
29
    
	
 
    	
 
    	
 
    
	
Section 10.06
    	
Entire Agreement
    	
29
    
	
 
    	
 
    	
 
    
	
Section 10.07
    	
Successors and Assigns;   Assignment
    	
30
    
	
 
    	
 
    	
 
    
	
Section 10.08
    	
No Third-party   Beneficiaries
    	
30
    
	
 
    	
 
    	
 
    
	
Section 10.09
    	
Amendment and   Modification; Waiver
    	
30
    
	
 
    	
 
    	
 
    
	
Section 10.10
    	
Governing Law; Dispute   Resolution
    	
30
    
	
 
    	
 
    	
 
    
	
Section 10.11
    	
Specific Performance
    	
31
    
	
 
    	
 
    	
 
    
	
Section 10.12
    	
Attorneys’ Fees
    	
31
    
	
 
    	
 
    	
 
    
	
Section 10.13
    	
Counterparts
    	
31
    
	
 
    	
 
    
	
Schedules and Exhibits
    	
 
    
	
 
    	
 
    
	
Schedule 1 — Disclosure   Schedule
    	
 
    
	
 
    	
 
    
	
Exhibit A —   Ancillary Agreements
    	
 
    
	
 
    	
 
    
	
Exhibit B — Terms   of Share Purchase Agreement
    	
 
    
	
 
    	
 
    
	
Exhibit C — Terms   of Shareholders’ Agreement
    	
 
    
	
 
    	
 
    
	
Exhibit D — IP   Transfer Agreement Terms
    	
 
    
	
 
    	
 
    
	
Exhibit E — IP   License Agreement Terms
    	
 
    

 

iii

 

FRAMEWORK AGREEMENT

 

This Framework Agreement (this “Agreement”) is entered into on [November 30], 2017 between VIA optronics GmbH, a company organized under the laws of Germany (“VIA”), and Toppan Printing Co., Ltd., a company organized under the laws of Japan (“Toppan”). Each of Toppan and VIA is referred to as a “Party”, and together, as the “Parties”.

 

RECITALS

 

A.                                    Toppan operates a business in Japan that develops, manufactures, and markets copper touch panel sensors used in touch panel modules and copper PET film used in touch panel sensors (such products, the “Products”, and such business, the “Business”).

 

B.                                    VIA is active in the field of optical bonding solutions.

 

C.                                    The Parties wish to engage in the Business together by having Toppan transfer certain assets and liabilities of the Business to a newly formed company (“Newco”) in which VIA will hold a 65% equity interest and Toppan a 35% equity interest.

 

D.                                    In connection with the operation of the Business through Newco, the Parties will enter into several undertakings, pursuant to the Transaction Documents, regarding Newco’s establishment and governance, a corporate spin-off, and commercial matters relating to the Business.

 

E.                                     VIA wishes to purchase from Toppan, and Toppan wishes to transfer to VIA, certain assets and liabilities of the Business.

 

The Parties hereby agree as follows:

 

ARTICLE I
 DEFINITIONS

 

Section 1.01                            Definitions. The following terms have the meanings specified or referred to below:

 

Action: Any claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation, citation, summons, subpoena or investigation of any nature, civil, criminal, administrative, regulatory or otherwise, whether at law or in equity.

 

Affiliate: Of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

 

Ancillary Agreements: The agreements listed in Exhibit A.

 

Antisocial Force: An organized crime group (boryokudan), a member of an organized crime group, an individual for whom five years have not elapsed from the date he or she ceased to be an organized crime group member, a quasi-constituent member thereof, an enterprise related to an organized crime group, a corporate racketeer (sokaiya), an extortionist advocating social movement, a special intelligence violence group, and other similar Persons (collectively, “Organized Crime Group Member”), and a Person who falls under any of the following:

 

(i)                                     A Person that has any relationship by which its management is considered to be controlled by any Organized Crime Group Member,

 

(ii)                                  A Person that has any relationship by which any Organized Crime Group Member is considered to be involved substantially in its management,

 

(iii)                               A Person that has any relationship by which it is considered to make unlawful use of any Organized Crime Group Member for the purpose of securing unjust advantage for itself or any third party or for causing damage to any third Person,

 

(iv)                              A Person that has any relationship by which it is considered to offer funds or provide benefits to any Organized Crime Group Member, or

 

(v)                                 A person that has any officers or persons involved substantially in its management having socially condemnable relationships with any Organized Crime Group Member.

 

Antitrust Law: Statutes, rules, regulations, orders, decrees, administrative and judicial doctrines, and other Laws of any jurisdiction that are designed or intended to prohibit, restrict or regulate actions that may have the purpose or effect of creating a monopoly, lessening competition or restraining trade.

 

Business Day: Any day except Saturday, Sunday or any other day on which commercial banks located in Tokyo, Japan or Frankfurt, Germany are authorized or required by Law to be closed for business.

 

Closing: The consummation of the Spin-off, the Share Transfer, and the other transactions contemplated in ARTICLE II.

 

Companies Act: The Companies Act of Japan (Act No. 86 of July 26, 2005).

 

Data Room: The virtual data room relating to the Business established by Toppan and hosted by Firmex, as it existed on the Business Day immediately preceding the Closing Date, unless the Parties decide to close the data room earlier, in which case it will be as it existed on the Business Day before the data room closes.

 

Disclosure Schedule: The schedule attached as Schedule 1 to this Agreement.

 

2

 

Encumbrance: Any mortgage, pledge, lien, charge, security interest, claim or other encumbrance.

 

Exchange Rate: For purposes of the Share Purchase Price, the IP Purchase Price, the Closing IP Purchase Price, the IP Purchase Price Balance, the Final Inventory Price, and the Target Inventory Valuation only, 1 USD equals 115 JPY.

 

Governmental Authority: Any national, prefectural, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.

 

Governmental Order: Any order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority.

 

Intellectual Property: Any of the following rights in any jurisdiction: (a) patents and patent applications, (b) trademarks, service marks, trade dress, and other proprietary indicia of goods and services, whether registered or unregistered, and the goodwill connected with the use of and symbolized by any of the foregoing, (c) original works of authorship in any medium of expression, whether or not published, all copyrights (whether registered or unregistered), all registrations and applications for registration of such copyrights all of the following and similar intangible property and related proprietary rights, and (d) confidential information, formulas, designs, devices, technology, know-how, research and development, inventions, methods, processes, compositions and other trade secrets, whether or not patentable.

 

Inventory: Work in progress, spare parts, photomasks, and supplies used by the Business to manufacture Products.

 

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

 

Losses: Actual out-of-pocket losses, damages, liabilities, costs or expenses.

 

NDA: The Non-Disclosure Agreement dated December 7, 2016 between Toppan and VIA.

 

Other Antitrust Approvals: Any approval, other than the Identified Antitrust Approvals, of any Governmental Authority in relation to Antitrust Laws that is required to complete the Share Transfer and the other transactions contemplated by the Transaction Documents.

 

Permits: All permits, licenses, franchises, approvals, authorizations, registrations, certificates, variances and similar rights obtained, or required to be obtained, from Governmental Authorities.

 

3

 

Person: An individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity.

 

Representative: With respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants and other agents of such Person.

 

Retained IP: The Intellectual Property set forth under the heading “Retained IP” in Section 1.02 of the Disclosure Schedule.

 

Satte Facility: The facility located at 4237-1 Soushinden, Satte-shi, Saitama, 340-0013 Japan, that is currently being used by the Business.

 

Shiga Facility: The facility located at 1101-20, Myohoji-cho, Higashiomi, Shiga, 527-8566, Japan, that is currently being used by the Business.

 

Target Inventory Valuation: JPY200,896,000, which is equal to the valuation of the Inventory on August 31, 2017.

 

Termination Fee: JPY 55,000,000.

 

Toppan Account:

 

	
Bank Name &   Branch:
    	
Sumitomo Mitsui Banking   Corporation, Nihonbashi Branch
    
	
 
    	
 
    
	
Branch Address:
    	
2-1-1, Nihonbashi   Murromachi, Chuo-ku, Tokyo 103-0022, Japan
    
	
 
    	
 
    
	
Swift Code:
    	
SMBCJPJT
    
	
 
    	
 
    
	
Bank Account#:
    	
1025362
    

 

Transaction: The transactions contemplated by this Agreement and the Transaction Documents.

 

Transaction Documents: This Agreement and the Ancillary Agreements.

 

Transferred Assets: The assets set forth under the heading “Transferred Assets” in Section 1.01 of the Disclosure Schedule.

 

Transferred IP: The Intellectual Property set forth under the heading “Transferred IP” in Section 1.02 of the Disclosure Schedule.

 

Transferred Liabilities: The liabilities set forth under the heading “Transferred Liabilities” in Section 1.01 of the Disclosure Schedule.

 

VIA Account:

 

	
Bayerische Landesbank
    
	
SWIFT BIC BYLADEMMXXX
    

 

4

 

	
IBAN DE87 7005 0000   0004 5134 16 (EUR)
    
	
IBAN DE26 7005 0000   0174 5134 16 (USD)
    
	
IBAN DE61 7005 0000   0474 5134 16 (CNY)
    

 

Section 1.02                            Other Defined Terms. In addition to the terms defined above, the following terms shall have the respective meanings given thereto in the articles indicated below:

 

	
Defined Term
    	
 
    	
Section
    
	
Agreement
    	
 
    	
Preamble
    
	
Antitrust Approvals
    	
 
    	
Section 6.04(b)
    
	
Balance Sheet
    	
 
    	
Section 6.06
    
	
Bank
    	
 
    	
Section 2.06(a)
    
	
Business
    	
 
    	
Recitals
    
	
Business Assistance Agreement
    	
 
    	
Section 2.07(a) 
    
	
Closing Date
    	
 
    	
Section 3.01
    
	
Closing Date Inventory Statement
    	
 
    	
Section 2.09(a)
    
	
Closing IP Purchase Price
    	
 
    	
Section 2.02(a)
    
	
Direct Claim
    	
 
    	
Section 9.05(c)
    
	
Excluded Assets
    	
 
    	
Disclosure Schedule, Section 1.01
    
	
Excluded Liabilities
    	
 
    	
Disclosure Schedule, Section 1.01
    
	
Final Inventory Valuation
    	
 
    	
Section 2.09(c)
    
	
Governmental Approvals
    	
 
    	
Section 6.04(a)
    
	
Indemnified Party
    	
 
    	
Section 9.04
    
	
Indemnifying Party
    	
 
    	
Section 9.04
    
	
IP Purchase Price
    	
 
    	
Section 2.02(a)
    
	
IP Purchase Price Balance
    	
 
    	
Section 2.02(a)
    
	
Lease Agreement
    	
 
    	
Section 2.05
    
	
L/Cs
    	
 
    	
Section 2.06(a)
    
	
Loan
    	
 
    	
Section 2.01(e)
    
	
Loan Agreement
    	
 
    	
Section 2.01(e)
    
	
Manufacturing Agreement
    	
 
    	
Section 2.04
    
	
Newco
    	
 
    	
Recitals
    
	
Objection Notice
    	
 
    	
Section 2.09(c)
    
	
Party
    	
 
    	
Preamble
    
	
Perfection Actions
    	
 
    	
Section 2.02(a)
    
	
Products
    	
 
    	
Recitals
    
	
R&D Agreement
    	
 
    	
Section 2.07(c)
    
	
Re-employed Employees
    	
 
    	
Section 2.03(a)(i)
    
	
Seconded Employees
    	
 
    	
Section 2.03(b)(i)
    
	
Secondment Agreement
    	
 
    	
Section 2.03(b)(iii)
    
	
SHA
    	
 
    	
Section 2.01(d)
    
	
Share Purchase Price
    	
 
    	
Section 2.01(c)
    
	
Shares
    	
 
    	
Section 2.01(c)
    
	
Share Transfer
    	
 
    	
Section 2.01(c)
    
	
SPA
    	
 
    	
Section 2.01(c)
    
	
Spin-off
    	
 
    	
Section 2.01(a)
    

 

5

 

	
Spin-off Plan
    	
 
    	
Section 2.01(a)
    
	
System License Agreement
    	
 
    	
Section 2.07(b)
    
	
Third-Party Claim
    	
 
    	
Section 9.05(a)
    
	
Toppan
    	
 
    	
Preamble
    
	
Toppan Distribution Agreement
    	
 
    	
Section 2.07(d)
    
	
VIA
    	
 
    	
Preamble
    
	
VIA Distribution Agreement
    	
 
    	
Section 2.07(d)
    

 

ARTICLE II
 OVERVIEW OF THE TRANSACTION

 

Section 2.01                            L/Cs, Competition Clearance, Spin-off; Share Transfer; Newco Governance.

 

(a)                                 L/Cs and Antitrust Approvals. Promptly after execution of this Agreement, VIA shall deliver to Toppan the L/Cs and the Parties shall perform their obligations under Section 6.04.

 

(b)                                 Spin-off.

 

(i)                                     Promptly after execution of this Agreement, Toppan shall begin (A) formulating a plan (the “Spin-off Plan”) to transfer the Transferred Assets and Transferred Liabilities to Newco by means of an incorporation-type company split (shinsetsu bunkatsu) in accordance with the Companies Act (the “Spin-off”) and (B) preparing the documentation and take other steps necessary to implement the Spin-off. Toppan shall not implement the Spin-off Plan without VIA’s advance written consent, which consent VIA shall not unreasonably withhold, delay, or condition. Promptly following adoption of the Spin-off Plan, Toppan shall deliver a certified copy of the Spinoff Plan to VIA.

 

(ii)                                  The Spin-off Plan will provide for the incorporation of Newco as a joint stock company (kabushiki kaisha) under Japanese law.

 

(iii)                               As promptly as possible after VIA has obtained the Antitrust Approvals, Toppan shall implement the Spin-off Plan and complete the Spin-off through the filing with the relevant legal affairs bureau of an application for Newco’s commercial registry. Toppan shall show VIA a draft of the application at least seven Business Days before filing.

 

(c)                                  Share Transfer. At the Closing and immediately after the transfer of the Transferred Assets and Transferred Liabilities to Newco pursuant to the Spin-off, Toppan shall sell to VIA 65% of the Shares in exchange for payment by VIA to the Toppan Account of JPY211,231,000 (the “Share Purchase Price”) pursuant to a share purchase agreement that incorporates the terms set forth in Exhibit B (such agreement, the “SPA,” and such transfer of shares, the “Share Transfer”), such that following the Share Transfer, VIA will hold 65% of Newco’s share capital and Toppan will hold 35% of Newco’s share capital. The Parties shall exercise best efforts to finalize the SPA promptly

 

6

 

after execution of this Agreement and to execute the SPA promptly after it has been finalized, it being understood that the Share Transfer will occur, and other operative provisions of the SPA, will come into effect only when and if Closing occurs, and if this Agreement is terminated, the SPA will terminate automatically.

 

(d)                                 Shareholders’ Agreement. At Closing and immediately after the Share Transfer, the Parties shall enter into a shareholders’ agreement with respect to Newco that incorporates the terms set forth in Exhibit C (the “SHA”). The Parties shall exercise best efforts to finalize the SHA promptly after execution of this Agreement and to execute the SHA as promptly as practicable, it being understood that the operative provisions of the SHA will come into effect only when and if Closing occurs, and if this Agreement is terminated, the SHA will terminate automatically.

 

(e)                                  Loan to Newco. At the Closing and immediately after the Share Transfer, VIA shall extend a loan to Newco in the amount of JPY369,638,750, which represents 65% of the IP Purchase Price (the “Loan”), pursuant to a loan agreement between VIA and Newco (the “Loan Agreement”) that the Parties shall negotiate in good faith. The Loan will be at arm’s-length terms. The Parties shall cause Newco to use the entirety of the Loan proceeds to purchase the Transferred IP.

 

Section 2.02                            Intellectual Property.

 

(a)                                 Transfer of Transferred IP. At the Closing and immediately after extension of the Loan, Toppan shall transfer to Newco the Transferred IP in exchange for JPY568,675,000 (the “IP Purchase Price”), pursuant to an intellectual property purchase agreement between Toppan and Newco that incorporates the terms set forth in Exhibit D (the “IP Transfer Agreement”). Newco shall pay the IP Purchase Price to Toppan as follows: (i) JPY369,638,750 at Closing (the “Closing IP Purchase Price”) and (ii) the difference between the IP Purchase Price and the Closing IP Purchase Price (the “IP Purchase Price Balance”) in installments pursuant to terms to be agreed by the Parties in the IP Transfer Agreement. Newco’s obligation to pay the IP Purchase Price Balance will be secured by a security interest in all of Newco’s assets in favor of Toppan. The Parties shall, and shall cause Newco to, enter into an agreement and to take all actions necessary to create and perfect such security interest (the “Perfection Actions”), in forms to be agreed by the Parties. The Parties further agree that any costs associated with the Perfection Actions (including, but not limited to, applicable stamp duties, registration fees, filing fees as well as judicial scrivener fees or patent attorney fees, if applicable) shall be borne by Newco. For the avoidance of doubt, Toppan is entitled place and establish security interests to cover the amount of the unpaid IP Purchase Price Balance over the assets of Newco, and if Toppan enforces such security interests, Toppan is entitled to recover only the amount of such unpaid IP Purchase Price Balance at the time of such enforcement from such asset(s) enforced, the value of which will be determined in a commercially reasonable manner.

 

(b)                                 License of Retained IP. At the Closing and simultaneously with the transfer of the Transferred IP, Toppan shall license to Newco the Retained IP pursuant to an intellectual property license agreement between Toppan and Newco that incorporates

 

7

 

the terms set forth in Exhibit E (the “IP License Agreement”). The consideration for the license of the Retained IP is included in the Share Purchase Price and no separate consideration for the Retained IP license will be required.

 

Section 2.03                            Business Employees.

 

(a)                                 Re-employed Employees.

 

(i)                                     The Parties shall exercise reasonable efforts to cause certain employees of Toppan and its Affiliates agreed in advance by the Parties (the “Re-employed Employees”) to be employed by Newco at Closing immediately following the completion of the Spin-off, subject to their consent. It is anticipated that the Re-employed Employees will serve as management of Newco.

 

(ii)                                  As part of their reasonable efforts, the Parties shall cause Newco to offer to each Re-employed Employee, for a period of at least three years after Closing, employment terms (including compensation and retirement allowance) and work conditions that are, in the aggregate, at least equivalent to his or her employment terms and work conditions immediately before Closing.

 

(iii)                               Toppan shall pay to each Re-employed Employee at Closing the retirement allowance (taishokukin) or otherwise applicable allowances/considerations that he or she is entitled to receive upon retirement at Closing under Toppan’s work rules.

 

(iv)                              Neither Party will be required to offer a Re-employed Employee additional consideration to entice him or her to transfer to Newco in order for a Party to satisfy its reasonable efforts under this Section 2.03(a).

 

(b)                                 Seconded Employees.

 

(i)                                     The Parties shall negotiate in good faith to agree on a list of employees of Toppan and its Affiliates who are engaged in the manufacture, quality control, production management, production engineering, and line engineering of Products and who have the appropriate qualifications to be seconded to Newco (the “Seconded Employees”). In drawing up the list of Seconded Employees, the Parties shall take into account the distance between the employees’ residence and Newco’s facilities and Toppan’s need for such employees to work for Toppan.

 

(ii)                                  The duration of the Seconded Employees’ term of secondment will be three years from the Closing Date.

 

(iii)                               The Parties shall negotiate in good faith a secondment agreement to be entered into at Closing between Newco and Toppan that will define the Parties’ obligations with respect to the Seconded Employees (the “Secondment Agreement”).

 

8

 

Section 2.04                            Manufacturing Agreement. Toppan shall manufacture copper PET films at the Satte Facility for Newco for a post-Closing period to be agreed by the parties pursuant to a manufacturing agreement between Toppan and Newco (the “Manufacturing Agreement”).

 

Section 2.05                            Lease Agreement. Toppan shall lease space to Newco at the Shiga Facility for a post-Closing period to be agreed by the parties pursuant to a lease agreement between Toppan and Newco (the “Lease Agreement”) and with lease payments that are consistent with prevailing rates in the area. The Parties shall cause Newco to use the leased premises as its headquarters.

 

Section 2.06                            Bank Guarantee.

 

(a)                                 Promptly after execution of this Agreement, the Parties shall negotiate the terms of one or more standby letters of credit (the “L/Cs”) with a bank that is mutually agreeable to the Parties (the “Bank”) naming Toppan as the beneficiary.

 

(i)                                     One L/C will be in the amount of the Share Purchase Price and contain an undertaking by the Bank to pay the Share Purchase Price to Toppan if the Closing occurs.

 

(ii)                                  The other L/Cs will relate to the Termination Fee to Toppan if the Closing does not occur and if VIA is obligated to pay the Termination Fee pursuant to Section 8.02(a). The terms of these L/Cs will be negotiated by the Parties in good faith and these L/Cs may be delivered to Toppan separately from the first L/C.

 

(b)                                 VIA shall pay all fees and costs associated with the L/Cs.

 

Section 2.07                            Other Agreements.

 

(a)                                 Toppan shall provide various services agreed by the Parties to support the Business, such as administrative and back-office support, procurement support, and design and mask support. The Parties shall negotiate in good faith the scope, duration, fees and other terms of any such services in a services agreement between Toppan and Newco (the “Business Assistance Agreement”). Among other terms, the Business Assistance Agreement will specify that all supplies that Toppan procures from third parties and sells to Newco will be sold without any margin on the price that Toppan pays third parties for those supplies.

 

(b)                                 During the period agreed by the Parties, Toppan shall grant to Newco the right to use a production management software system developed by Toppan that is necessary to operate the Business. The fee payable by Newco to Toppan will be equal to 1% per annum of Newco’s annual global sales of Products for as long as Toppan is the sole party providing the system to Newco. If VIA provides all or a portion of the system to Newco, the Parties shall negotiate in good faith an equitable adjustment to the fee that reflects each Party’s contribution to Newco. The Parties shall negotiate in good faith the scope, duration and other terms of any such grant of right in a system license agreement between Toppan and Newco (the “System License Agreement”).

 

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(c)                                  Toppan and Newco shall negotiate in good faith the terms of a joint development agreement or a research and development service agreement to be entered into between Toppan and Newco pursuant to which Toppan will provide research and development-related activities that are necessary for the Business (the “R&D Agreement”). The parties will discuss the treatment of know-how developed after Closing that (i) is owned exclusively by Toppan and (ii) is necessary for the manufacture of Products.

 

(d)                                 It is contemplated that Newco will appoint Toppan and VIA as distributors to distribute Products manufactured by Newco. The Parties shall negotiate in good faith with Newco the scope, duration, and other terms of distribution agreements between Toppan and Newco (the “Toppan Distribution Agreement”) and between VIA and Newco (the “VIA Distribution Agreement”).

 

(e)                                  If either of the Parties believes it would be advisable for the Parties to enter into another agreement in furtherance of the Transaction, they shall discuss the terms of such an agreement in good faith.

 

Section 2.08                            Pre-Closing and Post-Closing Liabilities. Notwithstanding anything to the contrary contained in this Agreement and regardless of the definitions of Excluded Liabilities and Transferred Liabilities, the Parties agree that (i) Toppan shall be responsible for and Newco will not be responsible for any obligations and liabilities arising solely out of the Business operated by Toppan before the Closing, even if such obligations and liabilities arise after the Closing, and (ii) Newco shall be responsible for and Toppan will not be responsible for any obligations and liabilities arising out of the Business operated by, or any other activities of, Newco on or after the Closing.

 

Section 2.09                            Share Purchase Price Adjustment.

 

(a)                                 Between the date hereof and Closing, Toppan shall exercise reasonable commercial efforts to reduce the Inventory such that the Final Inventory Valuation is 1PY151,570,000. As part of these reasonable commercial efforts, Toppan shall disclose to VIA a non-binding plan to reduce its Inventory between the date hereof and Closing and Toppan shall report to VIA, by the 15th of each month between the date hereof and the Closing, Toppan’s non-binding valuation of the Inventory as of the end of the previous month.

 

(b)                                 Promptly after the Closing, Toppan shall review the Inventory and calculate the value of the Inventory as of the Closing Date. Toppan shall calculate the Inventory’s valuation using the same methodology it used to calculate the Target Inventory Valuation. Within 30 days after the Closing Date, Toppan shall deliver to VIA a list of the Closing Date Inventory and its valuation as of the Closing Date (the “Closing Date Inventory Statement”).

 

(c)                                  If VIA disagrees with the Closing Date Inventory Statement, VIA must deliver written notice of its objection and the bases therefor (the “Objection Notice”) within 15 business days after VIA’s receipt of the Closing Date Inventory Statement. If

 

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VIA does not deliver an Objection Notice within this 15-day period, the value of the Inventory on the Closing Date will be deemed final. If VIA delivers an Objection Notice within this 15-day period, the Parties shall discuss the area(s) of disagreement in the Closing Date Inventory Statement in good faith until they have agreed on the value of the Inventory on the Closing Date.

 

(d)                                 Within five Business Days after the value of the Inventory on the Closing Date has become final or agreed pursuant to Section 2.09(c) (the “Final Inventory Valuation”), the Parties shall make the following adjustments to the Share Purchase Price:

 

(i)                                     if the Final Inventory Valuation exceeds the Target Inventory Valuation, VIA shall pay the excess amount to the Toppan Account and the Share Purchase Price will be adjusted upward in the amount of the excess, and

 

(ii)                                  if the Target Inventory Valuation exceeds the Final Inventory Valuation, Toppan shall pay the excess amount to the VIA Account and the Share Purchase Price will be adjusted downward in the amount of the excess.

 

Section 2.10                            Further Assurances. Following the Closing, each Party shall execute and deliver any additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

 

ARTICLE III
 CLOSING; CLOSING DELIVERABLES

 

Section 3.01                            Closing. The Closing will take place at the Tokyo office of Jones Day 14 days after the completion of the Spin-off, unless any of the other conditions to closing set forth in ARTICLE VII have not been waived by the appropriate Party or satisfied before completion of the Spin-off (other than the conditions to be satisfied on the Closing Date, but subject to the waiver of those conditions by the appropriate Party or their satisfaction), in which case the Closing will take place within 14 days after waiver by the appropriate Party or satisfaction of all the conditions to closing set forth in ARTICLE VII (other than the conditions to be satisfied on the Closing Date, but subject to the waiver of those conditions by the appropriate Party or their satisfaction), or at such other times and places as the Parties may agree. The date on which the Closing occurs is called the “Closing Date.” Unless the Parties agree otherwise, the Closing will be deemed to occur and be effective at the close of business on the Closing Date.

 

Section 3.02                            Closing Deliverables and Actions.

 

(a)                                 VIA Closing Deliverables and Actions. VIA shall deliver the following documents and take the following actions at Closing:

 

(i)                                     pay the Share Purchase Price to the Toppan Account,

 

(ii)                                  make available the Loan amount to Newco,

 

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(iii)                               cause Newco to pay the Closing IP Purchase Price to the Toppan Account in immediately available funds,

 

(iv)                              deliver its executed signature page to the SPA (if it has not already done so),

 

(v)                                 deliver its executed signature page to the SHA (if it has not already done so),

 

(vi)                              deliver a fully executed copy of the Loan Agreement,

 

(vii)                           take all actions necessary, and deliver all signature pages and other documents necessary, to complete the Perfection Actions, and

 

(viii)                        deliver its signature page, as applicable, of any other Ancillary Agreement the Parties decide to execute or have executed at Closing.

 

(b)                                 Toppan Closing Deliverables and Actions. Toppan shall deliver the following documents and take the following actions at Closing:

 

(i)                                     deliver to VIA a copy of the receipt of the application with the relevant legal affairs bureau for Newco’s commercial registry,

 

(ii)                                  deliver to VIA a certified copy of Newco shareholders’ register duly and validly recording the Share Transfer from Toppan to VIA,

 

(iii)                               deliver its executed signature page to the SPA (if it has not already done so),

 

(iv)                              deliver its executed signature page to the SHA (if it has not already done so),

 

(v)                                 deliver a fully executed copy of the IP Transfer Agreement,

 

(vi)                              deliver a fully executed copy of the IP License Agreement,

 

(vii)                           deliver a fully executed copy of the Secondment Agreement,

 

(viii)                        deliver a fully executed copy of the Manufacturing Agreement,

 

(ix)                              deliver a fully executed copy of the Lease Agreement,

 

(x)                                 deliver a fully executed copy of the Business Assistance Agreement,

 

(xi)                              deliver a fully executed copy of the System License Agreement,

 

(xii)                           deliver a fully executed copy of the Toppan Distribution Agreement,

 

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(xiii)                        deliver a fully executed copy of the VIA Distribution Agreement,

 

(xiv)                       deliver a fully executed copy of the R&D Agreement; and

 

(xv)                          deliver its signature page and Newco’s signature page, as applicable, of any other Ancillary Agreement the Parties decide to execute or have executed at Closing.

 

ARTICLE IV
 REPRESENTATIONS AND WARRANTIES OF TOPPAN

 

Toppan represents and warrants to VIA that the statements contained in this ARTICLE IV are true and correct as of the date hereof and as of the Closing Date (or other date specified in the representations and warranties).

 

Section 4.01                            Organization and Authority. Toppan is a company duly organized and validly existing under the Laws of Japan. Toppan has full corporate power and authority to enter into this Agreement and the Ancillary Agreement to which VIA is a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Toppan of this Agreement and any Ancillary Agreement to which Toppan is a party, the performance by Toppan of its obligations hereunder and thereunder and the consummation by VIA of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of Toppan. This Agreement has been duly executed and delivered by Toppan, and (assuming due authorization, execution and delivery by VIA) this Agreement constitutes a legal, valid and binding obligation of Toppan enforceable against Toppan in accordance with its terms, except to the extent enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors’ rights and by the availability of injunctive relief, specific performance and other equitable remedies. When each Ancillary Agreement to which Toppan is or will be a party has been duly executed and delivered by Toppan (assuming due authorization, execution and delivery by each other party thereto), that Ancillary Agreement will constitute a legal and binding obligation of Toppan enforceable against it in accordance with its terms, except to the extent enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors’ rights and by the availability of injunctive relief, specific performance and other equitable remedies.

 

Section 4.02                            No Conflicts; Consents. The execution, delivery and performance by Toppan of this Agreement and the Ancillary Agreement to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the articles of association or other organizational documents of Toppan or (b) conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to Toppan. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to Toppan in connection with the execution and delivery of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby.

 

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Section 4.03                            Legal Proceedings. There are no Actions pending or, to Toppan’s knowledge, threatened against Toppan or any of its Affiliates that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement and the Ancillary Agreements. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action.

 

Section 4.04                            Antisocial Forces. Toppan is not an Antisocial Force and does not have any relationships or interactions with any Antisocial Force.

 

Section 4.05                            Title to Shares; Capitalization. Immediately after completion of the Spin-off and on the Closing Date:

 

(a)                                 Toppan will hold 100% of the share capital of Newco (the “Shares”);

 

(b)                                 Toppan will have legal title to the Shares, free and clear of all Encumbrances of any kind, and upon completion of the Share Transfer, VIA will receive legal title to Shares representing 65% of Newco’s share capital, free and clear of all Encumbrances of any kind, and Toppan will have legal title to Shares representing 35% of Newco’s share capital, free and clear of all Encumbrances of any kind;

 

(c)                                  the Shares will represent 100% of Newco’s authorized and issued and outstanding capital stock;

 

(d)                                 there will be no outstanding options, warrants, call rights or commitments, or any other agreements of any character binding on Newco with respect to Newco’s capital stock or obligating Newco to issue, transfer or sell, or cause to be issued, transferred or sold, any shares of capital stock of, or other equity interests in, Newco or securities convertible into or exchangeable for such shares, or equity interests, or obligating Newco to grant, extend or enter into any such option, warrant, call, right, commitment or other agreement; and

 

(e)                                  there will be no voting trusts, proxies, shareholders’ agreements or other agreements or understandings relating to Newco’s capital stock to which Newco is a party or is bound with respect to voting any shares of Newco’s capital stock.

 

Section 4.06                            Title to Transferred Assets. Toppan owns and has good title to the Transferred Assets, free and clear of Encumbrances on the date hereof and immediately before the completion of the Spin-off.

 

Section 4.07                            Condition of Transferred Assets. Except as set forth in Section 4.07 of the Disclosure Schedule, the Transferred Assets are in good condition and are adequate for the uses to which they are being put, and none is in need of maintenance or repairs except for ordinary, routine maintenance and repairs that are not material in nature or cost.

 

Section 4.08                            Spin-off. Upon the completion of the Spin-off:

 

(a)                                 the Spin-off will have been completed in accordance with the Spin-off Plan,

 

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(b)                                 the Spin-off will have been completed in accordance with applicable Law without any objections from creditors,

 

(c)                                  Newco will be duly organized under the laws of Japan,

 

(d)                                 the Transferred Assets will have been validly transferred to Newco,

 

(e)                                  no Excluded Assets or Excluded Liabilities will have been transferred to Newco,

 

(f)                                   Newco will have all the permits necessary for the continued conduct of the Business after the Closing in substantially the same manner as conducted immediately before the Closing, and on the Closing Date:

 

(g)                                  Newco will own and have good title to the Transferred Assets, free and clear of Encumbrances, and

 

(h)                                 Newco will have all the permits necessary for the continued conduct of the Business after the Closing in substantially the same manner as conducted immediately before the Closing.

 

Section 4.09                            Sufficiency of non-Intellectual Property Assets. The Transferred Assets and the Re-employed Employees, together with the rights and services to be provided by Toppan to Newco pursuant to the Ancillary Agreements other than the IP License Agreement, are all the non-Intellectual Property assets and rights and services that are necessary and sufficient for the continued conduct of the Business after the Closing in substantially the same manner as conducted immediately before the Closing and constitute all the non-Intellectual Property rights, services, property and assets necessary to conduct the Business as currently conducted.

 

Section 4.10                            Intellectual Property.

 

(a)                                 The Transferred IP constitutes all patent rights and patent applications which, immediately before the Closing Date, (i) are owned exclusively by Toppan and (ii) are necessary for and used by Toppan exclusively for the manufacture, sale, and use of the Products. The heading entitled “Transferred IP” in Section 1.02 of the Disclosure Schedule lists all pending patent applications included in the Transferred IP and their status.

 

(b)                                 The Retained IP constitutes all patent rights and patent applications which, immediately before the Closing Date, (i) are owned exclusively by Toppan and (ii) are necessary for but not used by Toppan exclusively for the manufacture, sale, and use of the Products. The heading entitled “Retained IP” in Section 1.02 of the Disclosure Schedule lists all pending patent applications included in the Retained IP and their status.

 

(c)                                  Toppan owns all right, title and interest in and to the Transferred IP, free and clear of Encumbrances. None of the Transferred IP is subject to a license in favor of a third Person or to royalty payments to any third Person.

 

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(d)                                 Toppan has valid legal title to or contractual rights in all Retained IP as of the Closing.

 

(e)                                  As of the date hereof, (i) Toppan is not subject to any lawsuit alleging that (A) the Products, as sold by Toppan immediately before the date hereof, or the manufacture, sale, or use of such Products, or (B) carrying out the Business as conducted by Toppan immediately before the date hereof, in the case of each of (A) and (B), by using Transferred IP or Retained IP, infringes the intellectual property rights of any third Person, and (ii) Toppan has not received or is not aware of any advance written notice of filing of such lawsuit from any third Person. If between the date hereof and the Closing Date Toppan receives written notice of a lawsuit or an allegation that the use of Transferred IP or Retained IP infringes the intellectual property rights of any third Person, Toppan shall promptly inform VIA thereof and the Parties shall discuss in good faith how to address the lawsuit or allegation.

 

Section 4.11                            Balance Sheet. The Balance Sheet presents fairly, in all material respects, the financial condition of the Business as of the date of the Balance Sheet.

 

Section 4.12                            Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any Ancillary Agreement based upon arrangements made by or on behalf of Toppan.

 

Section 4.13                            Exclusive Representations and Warranties. The representations and warranties made by Toppan in this ARTICLE IV are the exclusive representations and warranties made by Toppan with respect to itself, the Transferred Assets, the Transferred IP, the Transferred Liabilities, the Business, or the Spin-off, other than representations and warranties relating to the Retained IP that Toppan will make in the IP License Agreement. Toppan hereby disclaims any other express or implied representations or warranties with respect to itself, the Transferred Assets, the Transferred IP, the Business, and the Spin-off, and VIA hereby waives such other express or implied representations or warranties. Notwithstanding the foregoing, Toppan represents and warrants that it has not intentionally disclosed (including through documents disclosed in the Data Room) to VIA or its Representatives any material information about the Transferred Assets, the Transferred IP, the Transferred Liabilities, the Business, or the Spin-off that Toppan knew to be materially false at the time of disclosure, nor has Toppan intentionally withheld information that would reasonably be expected to affect a reasonable buyer’s willingness to undertake the Transaction. VIA acknowledges that no documents (other than this Agreement and the IP License Agreement), statement or information made available to it or its Representatives by Toppan or its Representatives contains, directly or indirectly, and none will be deemed, directly or indirectly, to contain, representations or warranties of Toppan with respect to itself, the Transferred Assets, the Transferred IP, the Transferred Liabilities, the Business, or the Spin-off.

 

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ARTICLE V
 REPRESENTATIONS AND WARRANTIES OF VIA

 

VIA represents and warrants to Toppan that the statements contained in this ARTICLE V are true and correct as of the date hereof and as of the Closing Date (or other date specified in the representations and warranties).

 

Section 5.01                            Organization and Authority. VIA is a company duly organized and validly existing under the Laws of Germany. VIA has full corporate power and authority to enter into this Agreement and the Ancillary Agreement to which VIA is a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery by VIA of this Agreement and any Ancillary Agreement to which VIA is a party, the performance by VIA of its obligations hereunder and thereunder and the consummation by VIA of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the part of VIA. This Agreement has been duly executed and delivered by VIA, and (assuming due authorization, execution and delivery by Toppan) this Agreement constitutes a legal, valid and binding obligation of VIA enforceable against VIA in accordance with its terms, except to the extent enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors’ rights and by the availability of injunctive relief, specific performance and other equitable remedies. When each Ancillary Agreement to which VIA is or will be a party has been duly executed and delivered by VIA (assuming due authorization, execution and delivery by each other party thereto), that Ancillary Agreement will constitute a legal and binding obligation of VIA enforceable against it in accordance with its terms, except to the extent enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors’ rights and by the availability of injunctive relief, specific performance and other equitable remedies.

 

Section 5.02                            No Conflicts; Consents. The execution, delivery and performance by VIA of this Agreement and the Ancillary Agreement to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the articles of association or other organizational documents of VIA or (b) conflict with or result in a violation or breach of any provision of any Law or Governmental Order applicable to VIA. No consent, approval, Permit, Governmental Order, declaration or filing with, or notice to, any Governmental Authority is required by or with respect to VIA in connection with the execution and delivery of this Agreement and the Ancillary Agreements and the consummation of the transactions contemplated hereby and thereby.

 

Section 5.03                            Legal Proceedings. There are no Actions pending or, to VIA’s knowledge, threatened against VIA or any of its Affiliates that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement and the Ancillary Agreement. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action.

 

Section 5.04                            Sufficiency of Funds. VIA has sufficient cash on hand or other sources of immediately available funds to enable it to make payment of the Share Purchase Price, to extend the Loan, and to consummate the transactions contemplated by this Agreement and the Ancillary Agreements.

 

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Section 5.05                            Antisocial Forces. VIA is not an Antisocial Force and does not have any relationships or interactions with any Antisocial Force.

 

Section 5.06                            Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or any Ancillary Agreement based upon arrangements made by or on behalf of VIA.

 

Section 5.07                            Investigation by VIA. VIA has conducted its own independent investigation, verification, review and analysis of the Spin-off, Transferred Assets, Transferred Liabilities, and the Business and its operations, results of operations, financial condition, technology and prospects. In entering into this Agreement, VIA acknowledges that it has relied solely upon the aforementioned investigation, review and analysis and not on any factual representations or opinions of Toppan or any of its Representatives, except the specific representations and warranties of Toppan set forth in ARTICLE IV of this Agreement. VIA acknowledges and agrees that, except as set forth in ARTICLE IV of this Agreement, neither Toppan nor any of its Representatives or any other Person makes, has made, or will make any oral or written representation or warranty (including in the Ancillary Agreements), either express or implied, as to the accuracy or completeness of any information relating to the Business, the Transferred Assets, the Transferred Liabilities, or the Spin-off in materials made available to VIA or its Representatives in the Data Room or otherwise.

 

ARTICLE VI
 COVFNANTS

 

Section 6.01                            Conduct of Business before Closing; Maintenance of Transferred IP. From the date of this Agreement until the Closing, except as otherwise provided in this Agreement or consented to in writing by VIA (which consent VIA shall not unreasonably withhold, condition or delay), Toppan shall (a) conduct the Business in the ordinary course of business consistent with past practice and (b) use reasonable efforts to maintain and preserve the Transferred Assets and the Business’ relationships with its customers and suppliers.

 

For purposes of this Section 6.01, “reasonable efforts” means that Toppan shall act in good faith and devote a level of effort and resources consistent with what a reasonable party to a purchase agreement exercising prudent business judgment would expend to preserve the assets of a target business until closing and to close a sale of the target business, including the expenditure of nonmaterial out-of-pocket costs and expenses in connection with taking actions that are necessary to perform the undertaking, but not including the expenditure of material amounts to perform the undertaking that the Party is not otherwise required to expend under the Agreement.

 

Section 6.02                            Access to Information. From the date of this Agreement until the Closing, if VIA requires access to information relating to the Business, the Transferred Assets, or the Transferred Liabilities and the information is reasonably necessary to allow VIA to investigate new issues that have arisen in connection therewith and that are material in the context of the Transaction, Toppan shall disclose such information reasonably requested by VIA.

 

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Section 6.03                            Closing Conditions. From the date of this Agreement until the Closing, each Party shall use Reasonable Efforts to take such actions as are necessary to expeditiously satisfy the closing conditions set forth in ARTICLE VII.

 

Section 6.04                            Third-Person Consents; Antitrust Approvals.

 

(a)                                 Each Party shall act diligently and reasonably and shall, at the request of the other Party, use reasonable efforts to secure any consents, waivers and approvals of any third Person (including any Governmental Authority) required to be obtained to consummate the transactions contemplated by this Agreement and the Ancillary Agreements, except that before the Closing, neither VIA nor its Affiliates nor any of their respective Representatives shall contact any customer or supplier of the Business without Toppan’s prior written consent (which consent Toppan shall not unreasonably withhold, condition or delay).

 

For purposes of this Section 6.04(a), “reasonable efforts” means that the Party with the undertaking shall act in good faith and devote a level of effort and resources consistent with what a reasonable party to a purchase agreement with the intention of consummating the transaction and exercising prudent business judgement would expend to consummate a transaction, including the expenditure of internal resources and out-of-pocket costs and expenses in connection with taking actions that are necessary to perform the undertaking, but not including (i) the expenditure of material monetary amounts to perform the undertaking that the Party is not otherwise required to expend under the Agreement, (ii) the payment of any amount to any third Person (including any Governmental Authority) as consideration to obtain a consent, waiver, or approval, (iii) the commencement or participation in any litigation, (iv) the offer or grant of any accommodation to any third Person (including any Governmental Authority) as consideration to obtain a consent, waiver, or approval, or (v) the undertaking of any obligation or liability (in each case financial or otherwise) to any third Person (including any Governmental Authority) as consideration to obtain a consent, waiver, or approval.

 

(b)                                 On the date hereof, VIA has concluded that the Share Transfer and the other transactions contemplated by the Transaction Documents will require it to make a filing with or to obtain the approval of the following Governmental Authorities in relation to Antitrust Laws: China and Germany (the “Identified Antitrust Approvals”). VIA shall use its best efforts to obtain, or cause to be obtained, as promptly as possible, the Identified Antitrust Approvals and the Other Antitrust Approvals (the “Antitrust Approvals”). In particular, VIA shall (i) make appropriate filing to the relevant Governmental Authorities in Germany for the Identified Antitrust Approval in Germany within 15 Business Days after the date hereof (ii) initiate contact with the relevant Governmental Authorities in connection with the filing for the Identified Antitrust Approvals in China within 15 Business Days after the date hereof and shall make an official filing submission with those Governmental Authorities as promptly as possible thereafter but in any event within 30 days after the date hereof, (iii) definitively identify all and Other Antitrust Approvals and notify Toppan of these approvals by December 13, (iv) make official filings for the Other Antitrust Approvals by December 29, 2017, and (iv) supply as promptly as practicable to those Governmental Authorities any additional

 

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information and documentary material that they may request. VIA shall pay all filing fees required to paid to any Governmental Authority in connection with any required Antitrust Approval. VIA shall provide updates to Toppan on a regular basis and when requested by Toppan on the status of the efforts to obtain the Antitrust Approvals and shall take into account any comments provided by Toppan in relation to the Antitrust Approvals. Toppan shall cooperate with VIA in promptly seeking to obtain the Antitrust Approvals.

 

(c)                                  Without limiting the generality of VIA’s undertaking pursuant to this Section 6.04, VIA shall take any and all steps necessary to avoid or eliminate each and every impediment or to satisfy each and every condition under any Antitrust Law that may be asserted by any Governmental Authority so as to obtain the Antitrust Approvals and to allow the Parties to close the Share Transfer and other transactions contemplated under the Transaction Documents as promptly as possible, including proposing, negotiating, committing to and effecting, the sale, divestiture or disposition of any of its assets, properties or businesses or of the assets, properties or businesses to be acquired by it pursuant to this Agreement as is required by a Governmental Authority to obtain Antitrust Approval.

 

Section 6.05                            Confidentiality.

 

(a)                                 VIA acknowledges that the information being provided to it in connection with the transactions contemplated by the Transaction Documents is subject to the terms of the NDA, the terms of which are incorporated herein by reference. Effective upon, and only upon, the Closing, the obligations under the NDA will terminate except with respect to provisions regarding disclosure and use of confidential information not related to the Transferred Assets and Retained IP, which will continue indefinitely. If for any reason this Agreement is terminated prior to the Closing Date, the NDA will continue in full force and effect in accordance with its terms.

 

(b)                                 VIA shall, and shall cause Newco after the Closing to, to the extent either of them has any nonpublic information not relating solely to the Transferred Assets and Retained IP (any such information, “Toppan Information”) (i) treat Toppan Information strictly confidentially, (ii) not use Toppan Information for any purpose, and (iii) to the extent Toppan Information is documented or exists in written, photographical or other physical form, return such information (and any copies made thereof) to Toppan, and to the extent it is stored in electronic form, make a copy available to Toppan and expunge such information from any computer or other data carrier, in each case promptly after the Closing, and VIA shall, upon written request of Toppan, confirm to Toppan in writing compliance with these obligations by VIA and Newco.

 

Section 6.06                            Balance Sheet. Before the Closing, the Parties shall discuss in good faith and agree on a balance sheet for Newco as of immediately following completion of the Spin-off (the “Balance Sheet”).

 

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Section 6.07                            Transferred IP.

 

(a)                                 Until Closing, Toppan will exercise commercially reasonable efforts consistent with Toppan’s IP policies to prosecute the patent applications included in the Transferred IP and to maintain the patents included in the Transferred IP.

 

(b)                                 The Parties shall cause Newco to take all necessary steps to record the transfer of the Transferred IP with the Japan Patent Office and other relevant patent offices and to perfect the transfer of the Transferred IP promptly after the Closing. Toppan shall provide reasonable assistance to Newco in this regard.

 

(c)                                  Before Closing, Toppan shall inform VIA in writing of the estimated time and costs necessary for the issuance of the patent applications included in the Transferred IP. The Parties shall discuss these estimates and VIA shall, after discussion, acknowledge these estimates.

 

(d)                                 After Closing, Newco shall be solely responsible for prosecuting any patent applications included in the Transferred IP. Toppan shall provide reasonable assistance to Newco with respect to ongoing patent applications in exchange for reasonable compensation payable by Newco as agreed by the Parties.

 

Section 6.08                            Further Assurances. Following the Closing, each Party shall execute and deliver any additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

 

ARTICLE VII
 CONDITIONS TO CLOSING

 

Section 7.01                            Conditions to Obligations of Both Parties. The obligations of each Party to consummate the transactions contemplated by the Transaction Documents are subject to the fulfillment, at or before the Closing, of each of the following conditions:

 

(a)                                 No Law is in effect, and no Governmental Authority has enacted, issued, promulgated, enforced or entered any Governmental Order, that has the effect of making the transactions contemplated by the Transaction Documents illegal, otherwise restraining, enjoining, or prohibiting consummation of such transactions or causing any of the transactions contemplated hereunder to be rescinded following completion thereof.

 

(b)                                 No waiting period (including any extensions thereof) under Antitrust Laws or investigation by a Governmental Authority relating to the transactions contemplated by the Transaction Documents is unexpired or pending.

 

Section 7.02                            Conditions to Obligations of VIA. The obligation of VIA to consummate the transactions contemplated by the Transaction Documents is subject to the satisfaction of the following conditions:

 

(a)                                 The representations and warranties of Toppan in this Agreement are true and correct in all material respects on the date hereof and on the Closing Date with the same effect as though made on such date (except those representations and warranties

 

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that address matters only as of a specified date, the accuracy of which will be determined on that specified date in all respects).

 

(b)                                 Toppan has duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement and each of the other Transaction Documents to be performed or complied with by it before the Closing Date.

 

Section 7.03                            Conditions to Obligations of Toppan. The obligation of Toppan to consummate the transactions contemplated by the Transaction Documents is subject to the satisfaction of the following conditions:

 

(a)                                 The representations and warranties of VIA in this Agreement are true and correct in all material respects on the date hereof and on the Closing Date with the same effect as though made on such date (except those representations and warranties that address matters only as of a specified date, the accuracy of which will be determined on that specified date in all respects).

 

(b)                                 VIA has duly performed and complied in all material respects with all agreements, covenants and conditions required by this Agreement and each of the other Transaction Documents to be performed or complied with by it before the Closing Date.

 

ARTICLE VIII
 TERMINATION

 

Section 8.01                            Termination. This Agreement may be terminated at any time before the Closing:

 

(a)                                 by the mutual written consent of the Parties;

 

(b)                                 by VIA by written notice to Toppan if:

 

(i)                                     VIA is not then in material breach of any provision of this Agreement and there has been a breach, inaccuracy in or failure to perform any representation, warranty, covenant or agreement made by Toppan pursuant to this Agreement that would give rise to the failure of any of the conditions specified in ARTICLE VII and such breach, inaccuracy or failure has not been cured by Toppan within 20 days after Toppan’s receipt of written notice of such breach from VIA; or

 

(ii)                                  any condition set forth in Section 7.01 or Section 7.02 has not been, or if it becomes apparent that any such condition will not be, fulfilled by June 30, 2018, unless the failure is due to the failure of VIA to perform or comply with any of the covenants, agreements or conditions hereof to be performed or complied with by it before the Closing; or

 

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(c)                                  by Toppan by written notice to VIA if:

 

(i)                                     Toppan is not then in material breach of any provision of this Agreement and there has been a breach, inaccuracy in or failure to perform any representation, warranty, covenant or agreement made by VIA pursuant to this Agreement that would give rise to the failure of any of the conditions specified in ARTICLE VII and such breach, inaccuracy or failure has not been cured by VIA within 20 days after VIA’s receipt of written notice of such breach from Toppan; or

 

(ii)                                  any condition set forth in Section 7.01 or Section 7.03 has not been, or if it becomes apparent that any of such condition will not be, fulfilled by June 30, 2018, unless such failure is due to the failure of Toppan to perform or comply with any of the covenants, agreements or conditions hereof to be performed or complied with by it before the Closing.

 

Section 8.02                            Effect of Termination. If this Agreement is terminated in accordance with this ARTICLE VIII, this Agreement will immediately become void and:

 

(a)                                 If Toppan terminates this Agreement pursuant to Section 8.01(c)(i), VIA shall pay the Termination Fee in immediately available funds to the Toppan Account within 30 days after Toppan’s notice of termination. VIA acknowledges that (i) the agreement contained in this Section 8.02(a) is an integral part of the transactions contemplated by this Agreement and (ii) in light of the difficulty of accurately determining actual damages upon Toppan’s termination of this Agreement under circumstances in which the Termination Fee is payable pursuant to this Section 8.02(a), Toppan’s right to the Termination Fee constitutes a reasonable estimate of the losses that will be suffered by reason of any such termination of this Agreement and thus constitutes liquidated damages (and not a penalty). If VIA fails to pay the Termination Fee when due, VIA shall reimburse Toppan and its Affiliates for all reasonable costs and expenses actually incurred or accrued by them (including reasonable fees and expenses of counsel) in connection with any action (including the filing of any lawsuit) taken to collect payment of the Termination Fee, together with interest on such unpaid amounts at five percent per year calculated on a daily basis from the date the Termination Fee was required to be paid to the date of actual payment.

 

(b)                                 If VIA terminates this Agreement pursuant to Section 8.01(b)(i), Toppan shall pay the Termination Fee in immediately available funds to the VIA Account within 30 days after VIA’s notice of termination. Toppan acknowledges that (i) the agreement contained in this Section 8.02(a) is an integral part of the transactions contemplated by this Agreement and (ii) in light of the difficulty of accurately determining actual damages upon VIA’s termination of this Agreement under circumstances in which the Termination Fee is payable pursuant to this Section 8.02(a), VIA’s right to the Termination Fee constitutes a reasonable estimate of the losses that will be suffered by reason of any such termination of this Agreement and thus constitutes liquidated damages (and not a penalty). If Toppan fails to pay the Termination Fee when due, Toppan shall reimburse VIA and its Affiliates for all reasonable costs and expenses actually incurred or accrued by them (including reasonable fees and expenses of counsel) in connection with any action (including the filing of any lawsuit) taken to collect payment of the Termination

 

23

 

Fee, together with interest on such unpaid amounts at five percent per year calculated on a daily basis from the date the Termination Fee was required to be paid to the date of actual payment.

 

(c)                                  Neither Party will have any liability except as set forth in Section 8.02(a) or Section 8.02(b) relating to payment of the Termination Fee, Section 6.05, this ARTICLE VIII, ARTICLE IX, ARTICLE X, or in any corresponding definitions set forth in ARTICLE I.

 

(d)                                 Nothing herein relieves either Party from liability for fraud or for any breach of any provision of this Agreement before termination.

 

ARTICLE IX
 INDEMNIFICATION

 

Section 9.01                            Survival. Subject to the limitations and other provisions of this Agreement, the representations and warranties contained herein will survive the Closing and will remain in full force and effect for a period of 12 months from the Closing Date. None of the covenants or other agreements contained in this Agreement will survive the Closing Date other than those which by their terms contemplate performance after the Closing Date, and each such surviving covenant and agreement will survive the Closing for the period contemplated by its terms. Notwithstanding the foregoing, any claims asserted in good faith with reasonable specificity (to the extent known at such time) and in writing by notice from the non-breaching Party to the breaching Party before the expiration of the applicable survival period will not thereafter be barred by the expiration of that survival period and such claims will survive until finally resolved.

 

Section 9.02                            Indemnification by Toppan. Subject to the other terms and conditions of this ARTICLE IX, Toppan shall indemnify VIA against, and shall hold VIA harmless from and against, any and all Losses incurred or sustained by, or imposed upon, VIA based upon, arising out of, with respect to or by reason of:

 

(a)                                 any inaccuracy in or breach of any of the representations or warranties of Toppan contained in this Agreement; or

 

(b)                                 any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Toppan pursuant to this Agreement.

 

Section 9.03                            Indemnification by VIA. Subject to the other terms and conditions of this ARTICLE IX, VIA shall indemnify Toppan against, and shall hold Toppan harmless from and against, any and all Losses incurred or sustained by, or imposed upon, Toppan based upon, arising out of, with respect to or by reason of:

 

(a)                                 any inaccuracy in or breach of any of the representations or warranties of VIA contained in this Agreement; or

 

(b)                                 any breach or non-fulfillment of any covenant, agreement or obligation to be performed by VIA pursuant to this Agreement.

 

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Section 9.04                            Certain Limitations. The party making a claim under this ARTICLE IX is referred to as the “Indemnified Party” and the party against whom that claim is asserted under this ARTICLE IX is referred to as the “Indemnifying Party.” The indemnification provided for in Section 9.02 and Section 9.03 is subject to the following limitations:

 

(a)                                 The Indemnifying Party will not be liable to the Indemnified Party for indemnification under Section 9.02(a) or Section 9.03(a), as the case may be, until the aggregate amount of all Losses in respect of indemnification under Section 9.02(a) or Section 9.03(a) exceeds JPY10,000,000, in which event the Indemnifying Party shall pay or be liable only for Losses in excess of this amount.

 

(b)                                 The aggregate amount of all Losses for which an Indemnifying Party shall be liable pursuant to Section 9.02(a) or Section 9.03(a), as the case may be, will not exceed (i) 40% of the Share Purchase Price actually received by Toppan, if Toppan is the Indemnifying Party, or (ii) 20% of the Share Purchase Price, if VIA is the Indemnifying Party, unless VIA’s indemnification obligation arises from its failure to pay the Share Purchase Price, in which event VIA’s liability will not exceed 100% of the Share Purchase Price.

 

(c)                                  Payments by an Indemnifying Party pursuant to Section 9.02 or Section 9.03 in respect of any Loss will be limited to the amount of any liability or damage that remains after deducting therefrom any insurance proceeds and any indemnity, contribution or other similar payment received or reasonably expected to be received by the Indemnified Party (or the Company) in respect of any such claim. The Indemnified Party shall use its commercially reasonable efforts to recover under insurance policies or indemnity, contribution or other similar agreements for any Losses before seeking indemnification under this Agreement.

 

(d)                                 Payments by an Indemnified Party pursuant to or in respect of any Loss will be reduced by an amount equal to any tax benefit realized as a result of such Loss by the Indemnified Party. If an Indemnified Party is required under this Agreement to indemnify an Indemnified Party for a Loss suffered by the Indemnified Party (the “Indemnified Loss”) and if it is reasonably expected that the Indemnifiable Loss could lead the Indemnified Party to realize a tax benefit but the realization of the tax benefit is not certain when the Indemnifying Party must pay the Indemnifiable Loss, the Indemnifying Party may withhold payment of the portion of the Indemnifiable Loss equal to the reasonably expected tax benefit (the “Anticipated Tax Benefit Amount”) until it is possible to confirm whether the tax benefit will be realized. As soon as the amount of the realized tax benefit has been confirmed, the Indemnifying Party shall pay to the Indemnified Party the difference between the withheld Anticipated Tax Benefit Amount and the actually realized tax benefit. For the avoidance of doubt, the Indemnifying Party shall pay the portion of the Indemnifiable Loss other than the Anticipated Tax Benefit Amount.

 

(e)                                  In no event will any Indemnifying Party be liable to any Indemnified Party for any punitive, incidental, consequential, special or indirect damages, including loss of future revenue or income, loss of business reputation or opportunity relating to the breach

 

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or alleged breach of this Agreement, or diminution of value or any damages based on any type of multiple.

 

(f)                                   Each Indemnified Party shall take, and cause its Affiliates to take, all reasonable steps to mitigate any Loss upon becoming aware of any event or circumstance that would be reasonably expected to, or does, give rise thereto, including incurring costs only to the minimum extent necessary to remedy the breach that gives rise to such Loss.

 

(g)                                  Toppan will not be liable under this Agreement for any Losses based upon or arising out of a fact or event that occurred before the Closing and that Toppan disclosed to VIA either (i) in the Disclosure Schedule, or (ii) in the Data Room.

 

Section 9.05                            Indemnification Procedures.

 

(a)                                 Third-Party Claims. If any Indemnified Party receives notice of the assertion or commencement of any action, suit, claim or other legal proceeding made or brought by any Person who is not a party to this Agreement or an Affiliate of a Party to this Agreement or a Representative of the foregoing (a “Third-Party Claim”) against such Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party prompt written notice thereof. The failure to give such prompt written notice will not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party must describe the Third-Party Claim in reasonable detail, must include copies of all material written evidence thereof, and must specify the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party may participate in, or by giving written notice to the Indemnified Party, may assume the defense of, any Third-Party Claim at the Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, in which case the Indemnified Party shall cooperate in good faith in such defense. If the Indemnifying Party assumes the defense of any Third-Party Claim, subject to Section 9.05(b), it may take such action as it deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third-Party Claim in the name and on behalf of the Indemnified Party. The Indemnified Party may, at its own cost and expense, participate in the defense of any Third-Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof. If the Indemnifying Party elects not to compromise or defend such Third-Party Claim or fails to promptly notify the Indemnified Party in writing of its election to defend as provided in this Agreement, the Indemnified Party may, subject to Section 9.05(b), pay, compromise, defend such Third-Party Claim and seek indemnification for any and all Losses based upon, arising from or relating to such Third-Party Claim. The Parties shall cooperate with each other in all reasonable respects in connection with the defense of any Third-Party Claim, including making available (subject to the provisions of Section 6.05) records relating to such Third-Party Claim and furnishing, without expense (other than reimbursement of actual out-of-pocket expenses) to the defending Party, management employees of the non-defending Party as may be reasonably necessary for the preparation of the defense of the Third-Party Claim.

 

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(b)                                 Settlement of Third-Party Claims. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into settlement of any Third-Party Claim without the advance written consent of the Indemnified Party (which consent the Indemnified Party shall not unreasonably withhold, delay, or condition), except as provided in this Section 9.05(b). If a firm offer is made to settle a Third-Party Claim without leading to liability or the creation of a financial or other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all liabilities and obligations in connection with the Third-Party Claim and the Indemnifying Party desires to accept and agree to the offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party fails to consent to the settlement offer within ten days after its receipt of the notice, the Indemnified Party may continue to contest or defend the Third-Party Claim, and in such event, the maximum liability of the Indemnifying Party as to the Third-Party Claim will not exceed the amount of the settlement offer. If the Indemnified Party fails to consent to the settlement offer and also fails to assume defense of the Third-Party Claim, the Indemnifying Party may settle the Third-Party Claim upon the terms set forth in the settlement offer.

 

(c)                                  Direct Claims. If the Indemnified Party has a claim on account of a Loss that does not result from a Third-Party Claim (a “Direct Claim”), Indemnified Party shall assert the Direct Claim by giving the Indemnifying Party prompt written notice thereof. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party must describe the Direct Claim in reasonable detail, must include copies of all material written evidence thereof, and must specify the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party must respond in writing to such Direct Claim within 30 days after its receipt of the notice. During this 30-day period, the Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim, and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance (including access to the Company’s premises and personnel and the right to examine and copy any accounts, documents or records) as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within the 30-day period, the Indemnifying Party will be deemed to have rejected the claim, in which case the Indemnified Party may pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement.

 

Section 9.06                            Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement will be treated by the Parties as an adjustment to the Share Purchase Price for tax purposes, unless otherwise required by Law or by tax authorities or other Governmental Authorities.

 

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Section 9.07                            Exclusive Remedies. The Parties acknowledge and agree that their sole and exclusive remedy with respect to any and all claims (other than claims arising from intentional fraud on the part of a Party in connection with the transactions contemplated by this Agreement) for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or otherwise relating to the subject matter of this Agreement, will be pursuant to the indemnification provisions set forth in this ARTICLE IX. Nothing in this Section 9.07 limits either Party’s right to seek any remedy on account of intentional misrepresentation or fraud by either Party.

 

ARTICLE X
 MISCELLANEOUS

 

Section 10.01                     Expenses. Except as otherwise expressly provided herein, all costs and expenses, including, without limitation, fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby will be paid by the Party incurring such costs and expenses.

 

Section 10.02                     Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Party shall, at the request of the other Party, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be required to carry out the provisions hereof and give effect to the transactions contemplated hereby.

 

Section 10.03                     Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder must be in writing and will be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) on the date sent by facsimile or e-mail of a PDF document, if sent during the recipient’s normal business hours, and on the next Business Day, if sent after the recipient’s normal business hours, on condition that the communication sent by facsimile or e-mail is also sent by certified or registered mail, return receipt requested, postage prepaid; or (c) if sent internationally, on the fifth day, and if sent within Japan, on the second day, after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the Parties at the following addresses (or at such other address for a Party of which that Party notifies the other Party in accordance with this Section 10.03):

 

	
If to VIA:
    	
 
    	
VIA optronics GmbH
   Lettenfeldstr. 15, 90592 Schwarzenbruck
   Facsimile:
   E-mail: djuergens@via-optronics.com; jwoerle@via-optronics.com
   Attention: Daniel Jürgens and Dr. Jasmin Wörle
    
	
 
    	
 
    	
 
    
	
With a copy to (which will not constitute   notice):
    	
 
    	
Kloepfel Corporate Finance GmbH (Hauptsitz)
   Rundfunkplatz 2
   80335 Munchen
   Facsimile:
   E-mail:
    

 

28

 

	
 
    	
 
    	
Attention: Dr. Heiko Frank
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Jones Day
   Kamiyacho Prime Place
   1-17, Toranomon 4-chome
   Minato-ku, Tokyo 105-0001, JAPAN
   E-mail: mushijima@jonesday.com
   Attention: Makiko Ushijima
    
	
 
    	
 
    	
 
    
	
If to Toppan:
    	
 
    	
Toppan Printing Co., Ltd.
   Toppan Shibaura Bldg., 3-19-26 Shibaura, Minato-ku, Tokyo 108-8539
   Facsimile:
   E-mail: teruo.ninomiya@toppan.co.jp,
   kentaro.kitaoka@toppan.co.jp,
   Attention: Teruo Ninomiya and Kentaro Kitaoka
    
	
 
    	
 
    	
 
    
	
With a copy to (which will not constitute   notice):
    	
 
    	
southgate (registered association)
   Pacific Square Kudan-Minami, 7th Fl
   2-4-11 Kudan-Minami, Chiyoda-ku, Tokyo 102-0074, JAPAN
   E-mail: emarcks@southgate-law.com
   Attention: Eric Marcks
    

 

Section 10.04                     Headings. The headings in this Agreement are for reference only and do not affect its interpretation.

 

Section 10.05                     Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, that invalidity, illegality or unenforceability will not affect any other term or provision of this Agreement or invalidate or render unenforceable that term or provision in any other jurisdiction. Upon determination that any term or other provision is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect the Parties’ original intent as closely as possible in a mutually acceptable manner so that the transactions contemplated hereby may be consummated as originally contemplated to the greatest extent possible.

 

Section 10.06                     Entire Agreement. This Agreement and all related Exhibits and Schedules hereto constitutes the sole and entire agreement of the Parties with respect to the subject matter contained herein and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to this subject matter (including the Touch Panel Business Project Term Sheet entered into by the Parties on July 13, 2017. In particular, ARTICLE III and ARTICLE IX constitute the sole and entire agreement of the Parties with respect to representations and warranties and indemnification and supersede all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, including those contained in the Ancillary Agreements, with respect to representations and warranties and indemnification.

 

29

 

Section 10.07                     Successors and Assigns; Assignment. This Agreement is binding upon and will inure to the benefit of the Parties and their respective successors and permitted assigns. Neither Party shall assign its rights or obligations hereunder without the advance written consent of the other Party, which consent must not be unreasonably withheld or delayed by either Party. No assignment will relieve the assigning Party of any of its obligations hereunder.

 

Section 10.08                     No Third-party Beneficiaries. This Agreement is for the sole benefit of the Parties (and their respective heirs, executors, administrators, successors and assigns) and nothing herein, express or implied, is intended to or will confer upon any other Person, any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 10.09                     Amendment and Modification; Waiver. This Agreement may be amended, modified or supplemented only by an agreement in writing signed by each Party. No waiver by either Party of any of the provisions hereof will be effective unless explicitly set forth in writing and signed by that Party. No waiver by either Party will be, or will be construed as, a waiver in respect of any failure, breach or default not expressly identified by that written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement will be, or will be construed as, a waiver thereof; nor will any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

 

Section 10.10                     Governing Law; Dispute Resolution.

 

(a)                                 This Agreement is governed by and to be construed in accordance with the laws of Japan without giving effect to any choice or conflict of law provision or rule.

 

(b)                                 The Parties shall endeavor to resolve any dispute, controversy or difference arising out of, in connection with, or related to this Agreement (a “Dispute”) through good-faith negotiations. If a Dispute is not settled within 20 days after the receipt by a Party of a written request for negotiation under this Section 10.10(b), the Dispute will be referred for consideration by the Parties’ senior officers. The senior officers will have full authority to settle the Dispute.

 

(c)                                  If the senior officers are unable to resolve the Dispute within 20 days after the receipt by a Party of a written request for consideration of the Dispute by senior officers under Section 10.10(b), the Parties shall submit the Dispute to arbitration in Tokyo in accordance with the Commercial Arbitration Rules of the Japan Commercial Arbitration Association for final settlement. The Parties shall appoint three arbitrators in accordance with the rules and shall conduct the arbitration in English. The decision by the arbitration tribunal will be final and binding on the Parties and may be approved of or entered in (or otherwise be granted enforceability through necessary procedures by) any court having jurisdiction. The Parties consent to consolidation by the Japan Commercial Arbitration Association of arbitral proceedings initiated under this Agreement with arbitration proceedings initiated under any one or more of the Ancillary Agreements (notwithstanding the fact that those agreements may be governed by different laws).

 

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Section 10.11                     Specific Performance. The Parties agree that irreparable damage will occur if any provision of this Agreement is not performed in accordance with its terms and that the Parties are entitled to specific performance of its terms, in addition to any other remedy to which they are entitled at law or in equity.

 

Section 10.12                     Attorneys’ Fees. If any action at law or in equity is necessary to enforce or interpret the terms of the Agreement, the prevailing Party will be entitled to reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to which that Party may be entitled.

 

Section 10.13                     Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission will be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the Parties execute this Agreement on the date stated in the introductory clause.

 

 

	
VIA OPTRONICS GMBH
    	
 
    	
VIA OPTRONICS GMBH
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Jürgen Eichner
    	
 
    	
By:
    	
/s/ Daniel Jürgens
    
	
Name:
    	
Jürgen Eichner
    	
 
    	
Name:
    	
Daniel Jürgens
    
	
Title:
    	
Managing Director
    	
 
    	
Title:
    	
Managing Director
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
TOPPAN PRINTING CO., LTD.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Teruo Ninomiya
    
	
 
    	
 
    	
Name:
    	
Teruo Ninomiya
    
	
 
    	
 
    	
Title:
    	
Senior General Manager
    
						

 

32

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