Exhibit 2.1
Execution Copy
ASSET PURCHASE
AGREEMENT
THIS ASSET PURCHASE AGREEMENT, dated
as of July 15, 2009, is by and among Basin Water, Inc., a
Delaware corporation (“ Basin Water ”), Basin
Water-MPT, Inc., a Delaware corporation and a direct wholly-owned
subsidiary of Basin Water (together with Basin Water, collectively
“ Sellers ”), and Amplio Filtration Holdings,
Inc., a Delaware corporation (“ Buyer
”).
RECITALS
A. Sellers are engaged in the
business of designing, building and implementing systems for the
treatment of contaminated groundwater, municipal and industrial
wastewater, industrial process water and air streams from municipal
and industrial sources (as currently conducted by Sellers, the
“ Business ”).
B. Sellers desire to sell to Buyer
(or one or more Affiliates of Buyer designated by Buyer), and Buyer
(directly or through one or more Affiliates of Buyer designated by
Buyer) desires to acquire from Sellers, the Acquired Assets, and
Buyer (directly or through its designated Affiliate(s)) is willing
to assume the Assumed Obligations, all upon the terms and subject
to the conditions of this Agreement.
C. Buyer and Sellers desire that the
Acquired Assets be sold pursuant to the terms of this Agreement and
an order entered by the Bankruptcy Court approving such sale under
Section 363 of Title 11 of the United States Code (the “
Bankruptcy Code ”), as provided in a sale order
substantially in the form set forth on Exhibit A (the
“ Sale Order ”), and the assumption and
assignment of the Assumed Executory Contracts under
Section 365 of the Bankruptcy Code.
NOW, THEREFORE, in consideration of
the foregoing premises, the mutual representations, warranties,
covenants and agreements hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Buyer and Sellers agree as follows:
ARTICLE 1
DEFINITIONS
1.01 Definitions . Any
capitalized term used but not otherwise defined in this Agreement
has the meaning ascribed to such term in Appendix A to this
Agreement.
1.02 Interpretation . The
definitions set forth or referred to in Appendix A shall
apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The
headings to the Articles and Sections are for convenience of
reference and shall not affect the meaning or interpretation of
this Agreement. The words “include”,
“includes” and “including” shall be deemed
to be followed by the phrase “without limitation”. All
references herein to Articles, Sections, Exhibits, Appendices, and
Schedules shall be deemed to be references to Articles and Sections
of, and Exhibits, Appendices, and Schedules to, this Agreement
unless the context shall otherwise require. Unless the context
shall otherwise require, any reference to any contract, instrument,
statute, rule or regulation is a reference to it as amended and
supplemented from time to time (and, in the case of a statute, rule
or regulation, to any successor provision).
Any reference in this Agreement to a
“day” or a number of “days” (without the
explicit qualification of “Business”) shall be
interpreted as a reference to a calendar day or number of calendar
days. The Exhibits, Appendices, and Schedules hereto are hereby
incorporated by reference into, and shall be deemed a part of, this
Agreement; provided , however , that no Exhibit
consisting of a form of agreement or instrument shall be deemed to
become effective until executed and delivered by the appropriate
parties.
ARTICLE 2
PURCHASE AND SALE OF
ASSETS
2.01 Acquired Assets
.
(a) Upon the terms and subject to
the conditions of this Agreement, at the Closing, Sellers shall
sell, convey, assign, transfer and deliver to Buyer (or one or more
Affiliates of Buyer designated by Buyer) and its successors and
assigns, free and clear of all Liens and Claims to the fullest
extent permitted by Sections 363 and 365 of the Bankruptcy Code
(except for the Assumed Obligations and Permitted Liens), and Buyer
(directly or through one or more Affiliates of Buyer designated by
Buyer) shall purchase, acquire and take assignment and delivery of
all of Sellers’ right, title and interest, as of the
Effective Time, in the properties, assets, rights, titles and
interests of every kind and nature, owned, licensed or leased by
Sellers, as the same shall exist at the Effective Time, whether
tangible or intangible, real or personal and wherever located and
by whomever possessed, related to the operations or conduct of the
Business (collectively the “ Acquired Assets ”,
but exclusive, in all cases, of the Excluded Assets). Except as
provided in the representations and warranties of Sellers in this
Agreement (none of which representations and warranties will
survive the Closing), the Acquired Assets are being purchased
hereunder on an “as is” and “where is”
basis and with all faults. Notwithstanding anything to the contrary
in any other provision of this Agreement or any document or
instrument executed pursuant hereto but without limiting the
covenants of the Parties hereunder, to the extent that any of the
Acquired Assets are leased, licensed or otherwise held by Sellers
pursuant to an agreement with a Third Party, Buyer (directly or
through its designated Affiliate(s)) shall only acquire the right
to use and possession, as applicable, of such Acquired Assets if
the corresponding lease, license or other agreement is assigned to
and assumed by Buyer (or its designated Affiliate(s)) pursuant to
the Sale Order at the Closing. The Acquired Assets shall include,
without limitation, all of the following assets:
(i) Receivables . All
accounts receivable, payment intangibles, general intangibles,
chattel paper, letters of credit, notes receivable, checks, and
similar instruments, including but not limited to those set forth
on Exhibit 2.01(a)(i) and all unbilled Receivables greater
than zero (the “ Receivables ”);
(ii) Inventory . All
inventory of Seller Products and their components, wherever located
and whether held by Sellers, their Affiliates or Third Parties,
including all raw materials, work in process, samples, packaging,
supplies, service parts, purchased parts and goods, including but
not limited to the inventory set forth on Exhibit
2.01(a)(ii) (collectively, the “ Inventory
”) (other than Inventory required by Sellers to maintain and
service any Excluded Assets and set forth on Exhibit D
hereto), any and all rights to market and sell all such Inventory
and all warehouse receipts, bills of lading and similar
documents;
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(iii) Machinery and Equipment
. All machinery and equipment (including manufacturing assembly and
test equipment and water filtration or treatment units), fixed
assets, tools (including lab tools), spare and replacement parts,
maintenance equipment, materials, networks, computers, printers,
servers, or other equipment, wherever located and whether held by
Sellers, their Affiliates or Third Parties, including but not
limited to those set forth on Exhibit 2.01(a)(iii) , except
as set forth in Section 2.02(m) (the “
Machinery and Equipment ”);
(iv) Personal Property . All
office furnishings and furniture, display racks, shelves,
decorations, fixtures, supplies and other tangible personal
property, including but not limited to the items set forth on
Exhibit 2.01(a)(iv) (the “ Personal Property
”);
(v) Seller Intellectual Property
Assets . Subject to Section 2.05 , all Seller
Intellectual Property Assets, including but not limited to the
items set forth on Exhibit 2.01(a)(v) ;
(vi) Deposits and Advances .
All performance and other bonds, letters of credit, security and
other deposits, advances, advance payments, prepaid credits and
deferred charges in respect of any Acquired Assets, including but
not limited to the items set forth on Exhibit 2.01(a)(vi)
(the “ Deposits and Advances ”);
(vii) Assumed Executory
Contracts . All rights and claims in, to and under the
Contracts to which any Seller is a party or may be bound or receive
benefits or by which the Acquired Assets or the Assumed Obligations
may be affected as set forth on Exhibit B , including any
offsetting claims and rights of recoupment in favor of Sellers
(collectively, as may be revised pursuant to the terms of this
Agreement, the “ Assumed Executory Contracts ”);
provided , however , that such Exhibit may be revised
in accordance with Section 2.01(b) ;
(viii) Books and Records .
All books, files, papers, agreements, correspondence, databases,
information systems, programs, software, documents, records and
documentation thereof related to any of the Acquired Assets or the
Assumed Obligations, or used in the conduct of the Business, in
whatever medium, including paper, electronic and otherwise, whether
held by Sellers or by any Third Party unless transfer of such
records is prohibited by Law (the “ Books and Records
”);
(ix) Governmental Approvals .
All Governmental Approvals (and pending applications therefor) in
each case to the extent assignable based on the commercially
reasonable efforts of Sellers and other than exclusively related to
any Excluded Assets;
(x) Claims . All commercial
torts and other claims, choses-in-action, rights in action, rights
to tender claims or demands to Sellers’ insurance companies,
rights to any insurance proceeds, rights under any policy of
insurance or tail under which any Seller is the insured, rights to
any Damages, and other similar claims, in each case arising from or
relating to the Acquired Assets or the Assumed Obligations, other
than any and all claims and causes of action under Chapter 5 of the
Bankruptcy Code (collectively, the “ Chapter 5 Claims
”), including any attorney-client privileges related thereto
and expressly excluding (A) claims related to Sellers’
D&O insurance policies and (B) claims solely related to
the Excluded Assets, and in each case the proceeds therefrom
(collectively, the “ Seller Claims
”);
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(xi) Goodwill . All goodwill
generated by or associated with the Business; and
(xii) Other Assets . All
other assets, properties, rights and claims related to the
operations or conduct of the Business or which arise in or from the
conduct thereof, including any attorney client privileges related
thereto, but not any attorney client privileges related to the
Excluded Assets.
(b) Notwithstanding anything to the
contrary in this Agreement, Sellers shall not reject (or make any
motion to reject) any Assumed Executory Contract; Sellers shall not
reject (or make any motion to reject) any Contract set forth on
Exhibit C prior to the Closing or such earlier date as set
forth on Exhibit C (collectively, the “ Potential
Assumed Executory Contracts ”) unless expressly agreed to
by Buyer in writing, Buyer shall have the right, in its sole
discretion, to exclude any asset of Sellers from, or include any
asset of Sellers in, the Acquired Assets (including the right, in
Buyer’s sole discretion, to exclude any Contract from, or
include any Contract in, the definition of Assumed Executory
Contract) by providing written notice to Sellers prior to the
Closing. Notwithstanding the foregoing sentence, Buyer may only
revise Exhibit B to (A) add any Contract to such
Exhibit after the filing of such Exhibit pursuant to
Section 5.04(c) so long as the counterparty to such
Contract has either waived the right to notice and the opportunity
to object to the assignment of such Contract or been given a
reasonable opportunity to object as may be required by Law or
pursuant to an applicable Order of the Bankruptcy Court and,
notwithstanding any objections made by the counterparty, the
Bankruptcy Court approves the assumption of such Contract by Buyer
(or its designated Affiliate(s)); provided, however, that
the addition of any such Contract following the Auction will not
reduce the Cash Purchase Price, or (B) remove any Assumed
Executory Contract if (x) the Final Cure Cost associated with
such Assumed Executory Contract exceeds an amount equal to the
lesser of ten percent (10%) of the Estimated Cure Cost
associated with such Assumed Executory Contract or ten thousand
dollars ($10,000), or (y) a breach of such Contract by Sellers
has triggered non-monetary obligations of Sellers or any rights or
defenses of the counterparty to such Contract that Buyer deems
materially disadvantageous to Buyer and which obligations, rights
or defenses are not disclosed with particularity on the Seller
Disclosure Schedule.
(c) For purposes of this Agreement,
with respect to any Assumed Executory Contract or Potential Assumed
Executory Contract, “ Estimated Cure Cost ”
means Sellers’ estimate, as of the date of this Agreement, of
the respective costs of cure required to be satisfied in order for
Sellers to assume and assign such Assumed Executory Contract and
Potential Assumed Executory Contract as set forth on
Section 3.14 of the Seller Disclosure
Schedule.
2.02 Excluded Assets .
Notwithstanding anything to the contrary in
Section 2.01 , the following assets of Sellers shall be
retained by Sellers and are not being sold or assigned to Buyer (or
its designated Affiliate(s)) hereunder (collectively, the “
Excluded Assets ”).
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(a) Cash and Cash Equivalents
. All cash and cash equivalents (including marketable securities
and short-term investments);
(b) Certain Claims . Any
Chapter 5 Claims and any Seller Claims that relate exclusively to
an Excluded Asset;
(c) Corporate Documents .
Corporate seals, certificates of incorporation, minute books, stock
transfer records, or other records related to the corporate
organization of Sellers;
(d) Employee Benefit
Contracts . Seller Employee Benefit Plans and contracts of
insurance for employee group medical, dental and life insurance
plans;
(e) Records . All personnel
records and other Books and Records, including Tax Returns, that
Sellers are required by applicable Law to retain in their
possession;
(f) Deposits and Unbilled
Receivables . Any Deposits and Advances solely related to any
of the Excluded Assets or Excluded Liabilities and all unbilled
Receivables with a balance of zero or less;
(g) Insurance Policies . All
insurance policies and rights thereunder except to the extent
specified in Section 2.01(a)(x) ;
(h) Contracts . Any Contracts
which are not Assumed Executory Contracts as of the Effective
Time;
(i) Taxes . All claims for
refund of Taxes and other amounts collected by any Governmental
Authority to the extent such Taxes and other amounts were paid by
Sellers, and all rights to Tax loss carryforwards of any
Seller;
(j) Rights under Transaction
Documents . All rights of Sellers under the Transaction
Documents;
(k) Director and Officer
Claims . Any claims against Sellers’ directors and
officers;
(l) Unusable Assets . Any
tangible assets that are determined by Buyer in its sole
discretion, either prior to or within a reasonable period following
the Closing, to be obsolete, scrap, refuse, materially damaged or
otherwise unusable as of the Effective Time.
(m) Water Treatment Units for
Non-Assumed Contracts . Water treatment units subject to
Contracts which are not Assumed Executory Contracts and are located
on a customer’s premises as of the Effective Time;
and
(n) Other Excluded Assets .
Other assets of Sellers not transferred to Buyer (or its designated
Affiliate(s)), including the attorney client privileges related
thereto, as set forth on Exhibit D .
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2.03 Assumed Obligations .
Upon the terms and subject to the conditions of this Agreement,
effective at the Effective Time, Buyer (directly or through its
designated Affiliate(s)) shall only assume from Sellers and
thereafter only be responsible for the payment, performance or
discharge of the following Liabilities (collectively, the “
Assumed Obligations ”):
(a) the Liabilities and obligations
of Sellers created or incurred by events arising after the
Effective Time under the Assumed Executory Contracts or the
assigned Government Approvals;
(b) Property Taxes to the extent
specifically allocated to Buyer pursuant to
Section 9.05(b) ;
(c) Liabilities explicitly assumed
by Buyer pursuant to ARTICLE 6;
(d) all other Liabilities with
respect to the Acquired Assets created or incurred by events
arising after the Effective Time; and
(e) the costs of cure required to be
satisfied in order for Sellers to assume and assign each Assumed
Executory Contract under Section 365 of the Bankruptcy Code as
determined by the Bankruptcy Court at the Sale Hearing
(collectively, the “ Final Cure Costs
”).
2.04 No Other Liabilities
Assumed . Notwithstanding anything to the contrary in this
Agreement, except for the Assumed Obligations, Buyer (directly or
through its designated Affiliate(s)) shall not assume and shall not
be in any way liable or responsible for (whether directly,
indirectly, contingently or otherwise), any Liability of Sellers or
any other Person, whether relating to or arising out of the
Business, the Excluded Assets or the Acquired Assets or otherwise
(collectively, the “ Excluded Liabilities
”).
2.05 Non-Assignable Assets
.
(a) Notwithstanding anything to the
contrary in this Agreement, if pursuant to Section 365 or any
other provision of the Bankruptcy Code any of the Assumed Executory
Contracts or other Acquired Assets are held by the Bankruptcy
Court, despite application of Section 365(f) of the Bankruptcy
Code for Buyer’s benefit, to be non-assignable or
non-transferable (each, a “ Non-Assignable Asset
”) without the consent of, or waiver by, a Third Party (each,
an “ Assignment Consent ”), either as a result
of the provisions thereof or applicable Law, and any of such
Assignment Consents are not obtained by Sellers on or prior to the
Closing Date, Buyer may elect in its sole discretion to have
Sellers retain the Non-Assignable Asset and all Liabilities
relating thereto to the extent provided for in the Sale Order and
have Sellers continue after the Closing to use commercially
reasonable efforts to obtain such Assignment Consents, to the
extent reasonably requested by Buyer, and, in such case, this
Agreement and the other Transaction Documents shall not constitute
an assignment or transfer of such Non-Assignable Assets, and Buyer
(directly or through its designated Affiliate(s)) shall not assume
Sellers’ rights, interests or obligations under such
Non-Assignable Asset (and such Non-Assignable Asset shall not be
included in the Acquired Assets). Sellers shall use commercially
reasonable efforts (provided that such efforts shall not require
Sellers to pay any out-of-pocket costs to any Third Party) to
obtain all such Assignment Consents as soon as reasonably
practicable after the Closing Date and thereafter assign to Buyer
(or its designated Affiliate(s)) such Non-Assignable Assets.
Following any such assignment, such assets shall be deemed Acquired
Assets for purposes of this Agreement.
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(b) After the Closing, Sellers
shall, subject to any approval of the Bankruptcy Court that may be
required, reasonably cooperate with Buyer (provided that such
cooperation shall not require Sellers to pay any out-of-pocket
costs to any Third Party) to provide Buyer (or its designated
Affiliate(s)) with all of the benefits of the Non-Assignable Assets
as if the appropriate Assignment Consents had been obtained,
including by granting subleases, sublicenses or other rights as
appropriate, assisting in obtaining substitute assets (including
Governmental Approvals) and establishing arrangements whereby Buyer
(or one or more Affiliates of Buyer designated by Buyer) shall be
delegated the responsibilities and undertake the work necessary to
perform under the Assumed Executory Contracts.
(c) Notwithstanding anything
contained in this Agreement to the contrary, including Sections
2.05(a) and (b) above, nothing in this Agreement
shall prohibit Sellers from ceasing operations or winding up their
affairs following the Closing.
2.06 Purchase Price . The
purchase price payable at the Closing by Buyer to Sellers for the
Acquired Assets shall consist of the following amounts (the “
Purchase Price ”) and explicitly include consideration
for all Acquired Assets, including the Deposits and Advances that
constitute Acquired Assets, as well as all services provided by
Buyer to Sellers pursuant to the Transition Services
Agreement:
(a) cash in an amount equal to the
following (the “ Cash Purchase Price ”): Two
Million Dollars ($2,000,000) minus (a) an amount equal to the
Final Cure Costs and (b) the amount by which $2,900,000
exceeds the Acquired Receivables Amount as of Closing, payable by
wire transfer or delivery of other immediately available funds;
and
(b) the assumption of the Assumed
Obligations by Buyer (directly or through its designated
Affiliate(s)).
2.07 Closing . Upon the terms
and subject to the conditions of this Agreement, the closing of the
transactions contemplated by this Agreement (the “
Closing ”) shall occur at the offices of
Morrison & Foerster LLP, 12531 High Bluff Drive, Suite
100, San Diego, California 92130, or such other place as Buyer and
Sellers may mutually agree, as soon as practicable but in no event
later than the third (3 rd ) Business Day following the date upon
which all of the conditions set forth in ARTICLE 7 have been
satisfied or waived in accordance with this Agreement, or upon such
other date as Buyer and Sellers may mutually agree; provided
, however , that, absent an order from the Bankruptcy Court
that rescinds the automatic ten (10) day stay following the
entry of the Sale Order, Buyer may elect, in its sole discretion,
to delay the Closing until a date not later than the eleventh
(11 th
) calendar day following the
date upon which all of the conditions set forth in ARTICLE 7
have been satisfied or waived in accordance with this Agreement
(the “ Closing Date ”).
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2.08 Closing Deliveries by
Sellers . At the Closing, Sellers shall (a) take all steps
necessary to place Buyer (or its designated Affiliate(s)) in actual
possession and operating control of the Business and the Acquired
Assets and (b) deliver to Buyer the following items, duly
executed by Sellers, as applicable, all of which shall be in form
and substance reasonably acceptable to Buyer and its
counsel:
(a) General Assignment and Bill
of Sale . General Assignment and Bill of Sale, substantially in
the form set forth on Exhibit E , covering all of the
applicable Acquired Assets (the “ General Assignment and
Bill of Sale ”);
(b) Assignment and Assumption
Agreement . Assignment and Assumption Agreement, substantially
in the form set forth on Exhibit F , covering all of the
Assumed Obligations (the “ Assignment and Assumption
”);
(c) Intellectual Property
Confirmatory Assignments . Any and all documents necessary to
properly record the assignment to Buyer (or its designated
Affiliate(s)) of all of Sellers’ right, title and interest in
and to the Seller Intellectual Property Assets, including
(i) a patent assignment substantially in the form set forth on
Exhibit G , (ii) a copyright assignment substantially
in the form set forth on Exhibit H , (iii) a trademark
assignment substantially in the form set forth on Exhibit I
, and (iv) a domain name assignment agreement substantially in
the form set forth on Exhibit J ;
(d) Other Conveyance
Instruments . Such other specific instruments of notice, sale,
transfer, conveyance and assignment as Buyer may reasonably
request, including without limitation notices and applications for
transfer of Governmental Approvals;
(e) Transition Services
Agreement . A Transition Services Agreement, substantially in
the form set forth on Exhibit O (the “ Transition
Services Agreement ”);
(f) FIRPTA Certificates . A
FIRPTA certificate executed by each Seller, dated as of the Closing
Date, substantially in the forms set forth on Exhibit K-1
and Exhibit K-2 ;
(g) Assumed Executory
Contracts . Originals (or, to the extent originals are not
available, true and complete executed copies) of all Assumed
Executory Contracts (together with all amendments, supplements or
modifications thereto);
(h) Books and Records . The
Books and Records;
(i) Officer’s
Certificate . A certificate duly executed by an officer of each
Seller, dated as of the Closing Date (in form and substance
reasonably satisfactory to Buyer) certifying on behalf of Sellers
the matters in Section 7.01(a) and
Section 7.01(b) ;
(j) Evidence of Consents to
Assignment . Evidence of receipt of the consents with respect
to the Assumed Executory Contracts set forth on Exhibit L to
the extent such consents are not provided for or satisfied by the
Sale Order; and
(k) Copy of Sale Order . A
certified copy of the Sale Order.
2.09 Closing Deliveries by
Buyer . At the Closing, Buyer shall (a) deliver to Sellers
the Assignment and Assumption duly executed by Buyer (or its
designated Affiliate(s)), (b) deliver to Sellers the
Transition Services Agreement duly executed by Buyer (or
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its designated Affiliate(s)), (c) pay the
Cash Purchase Price by wire transfer or delivery of other
immediately available funds to the account designated in writing by
Sellers, (d) deliver to Sellers a certificate duly executed by
an officer of Buyer, dated as of the Closing Date (in form and
substance reasonably satisfactory to Sellers) certifying on behalf
of Buyer the matters in Section 7.01(a) and
Section 7.01(b) , and (e) deliver to Sellers such
other documents, instruments and certificates required by the
Bankruptcy Court to be delivered by Buyer as Sellers may reasonably
request.
2.10 Closing Deliveries by Buyer
and Sellers . At the Closing, Buyer and Sellers shall deliver
such other certificates, instruments or documents required pursuant
to the provisions of this Agreement or otherwise necessary or
appropriate to transfer the Acquired Assets and Assumed Obligations
in accordance with the terms of this Agreement and consummate the
transactions contemplated by this Agreement, and to vest in Buyer
(or its designated Affiliate(s)) and its successors and assigns
full, complete, absolute, legal and equitable title to the Acquired
Assets, free and clear of all Liens and Claims (other than
Permitted Liens). For the avoidance of doubt, notwithstanding
anything in the certificates, instruments or documents to be
delivered in accordance with this Agreement, none of the
representations and warranties in ARTICLE 3 and ARTICLE
4 shall survive the Closing.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF
SELLERS
Except as set forth in the
corresponding sections or subsections of the disclosure schedules
(unless the applicability of such disclosure to another section or
subsection is reasonably apparent) prepared by Sellers and
delivered to Buyer in connection with the execution and delivery of
this Agreement (the “ Seller Disclosure Schedule
”), Sellers jointly and severally hereby represent, warrant
and covenant to Buyer as of the date of this Agreement as
follows:
3.01 Organization, Good Standing,
Qualification . Each Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State
of Delaware, and has all requisite power and authority to own,
lease and operate its properties and to carry on its business as
now being conducted. Each Seller is duly qualified or licensed as a
foreign corporation to conduct business and is in good standing in
each jurisdiction where the character of the properties owned,
leased or operated by it or the nature of its business makes such
qualification or licensing necessary, except where the failure to
be so duly qualified or licensed and in good standing, individually
or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.
3.02 Authority;
Enforceability . Subject to the entry of the Sale Order,
(a) Sellers have all necessary corporate power and authority
to execute and deliver this Agreement and the other Transaction
Documents, to perform its obligations hereunder and thereunder, and
to consummate the transactions contemplated by this Agreement and
the other Transaction Documents; (b) the execution, delivery
and performance of this Agreement and the other Transaction
Documents and the consummation by Sellers of the transactions
contemplated by this Agreement and the other Transaction Document
have been duly and validly authorized by all requisite corporate
action and no other corporate proceedings on the part of Sellers
are necessary to authorize this Agreement or the other Transaction
Documents or to consummate the transactions contemplated hereby or
thereby; (c) this Agreement has been, and
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at the Closing the other Transaction Documents
will be, duly and validly executed and delivered by Sellers; and
(d) this Agreement constitutes, and at the Closing the other
Transaction Documents will constitute, the legal, valid and binding
obligation of Sellers, enforceable against Sellers in accordance
with their respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium and other
similar laws and equitable principles related to or limiting
creditors’ rights generally and by the availability of
equitable remedies and defenses, but giving effect to the Sale
Order.
3.03 No Conflicts; Required
Consents . Subject to the entry of the Sale Order, the
execution, delivery and performance of this Agreement and the other
Transaction Documents by Sellers do not and will not, with or
without notice or lapse of time:
(a) conflict with, violate or result
in any breach of (i) any of the provisions of each
Seller’s Certificate of Incorporation or bylaws;
(ii) any of the terms or requirements of any Governmental
Approval held by Seller or that otherwise relates to the Business
or any of the Acquired Assets or Assumed Obligations; or
(iii) any provision of any Assumed Executory Contract, except
in the case of (ii) and (iii) as would not reasonably be
expected to have a Material Adverse Effect;
(b) give any Governmental Authority
or other Person the right to (i) declare a default of,
exercise any remedy under, accelerate the performance of, cancel,
terminate, modify or receive any payment under any Assumed
Executory Contract or any Potential Assumed Executory Contract; or
(ii) revoke, suspend or modify any Governmental Approval;
or
(c) require Sellers to obtain any
Consent with respect to any Assumed Executory Contract, Potential
Assumed Executory Contract or Governmental Approval or make or
deliver any filing or notice to a Governmental Authority, other
than filings with the Bankruptcy Court.
3.04 Subsidiaries .
Section 3.04 of the Seller Disclosure Schedule sets
forth a true and complete list of all direct and indirect
Subsidiaries of Sellers, whether wholly-owned or otherwise. Other
than as set forth in Section 3.04 of the Seller
Disclosure Schedule, Sellers do not directly or indirectly own any
equity or similar interest in, or any interest convertible into or
exchangeable or exercisable for any equity or similar interest in,
any corporation, partnership, joint venture or other business
association or Person.
3.05 Legal Proceedings .
Except for Claims that will be resolved, eliminated from the
Acquired Assets, or discharged pursuant to the Sale Order of the
Bankruptcy Court:
(a) Other than the Bankruptcy Case,
there are no material Proceedings pending or, to the Knowledge of
Sellers, threatened against, relating to or affecting Sellers with
respect to the Business or any of the Acquired Assets, which, if
adversely determined, would reasonably be expected to have Material
Adverse Effect; and
(b) Except for Orders of the
Bankruptcy Court, there are no Orders outstanding against
Sellers.
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3.06 Financial Statements .
All of the Financial Statements (i) have been filed with the
U.S. Securities and Exchange Commission and are available on EDGAR,
(ii) are true and complete in all material respects,
(iii) are consistent in all material respects with the Books
and Records, (iv) present fairly and accurately in all
material respects the financial condition of Basin Water as of the
respective dates thereof and the results of operations, changes in
stockholders’ equity and cash flows of Basin Water for the
periods covered thereby (except as otherwise set forth in the
footnotes thereto), and (v) have been prepared in accordance
with GAAP, applied on a consistent basis throughout the periods
covered; provided , however , that the Unaudited
Financial Statements are subject to normal year-end adjustments and
do not contain footnotes required by GAAP.
3.07 Material Contracts .
Section 3.07 of the Seller Disclosure Schedule sets
forth a true and complete list of all Contracts to which any Seller
is party that are necessary for Sellers to conduct the Business in
the manner in which Sellers have conducted the Business in the
Ordinary Course of Business, including without limitation Business
License Agreements and Employment Agreements (collectively, the
“ Material Contracts ”). Sellers have made
available in the virtual data room to which Buyer and its
representatives have been granted access prior to the date hereof
true and complete executed copies of all Material Contracts (or
written summaries of the material terms thereof, if not in
writing), including all amendments, supplements, modifications and
waivers thereof. To Sellers’ Knowledge, each Assumed
Executory Contract and each Potential Assumed Executory Contract is
valid and in full force and effect, and is enforceable by Sellers
in accordance with its terms. Sellers have not waived any of their
material rights, defenses, setoffs or rights recoupment under any
Assumed Executory Contract or any Potential Assumed Executory
Contract.
3.08 Title; Sufficiency;
Condition of Assets .
(a) Sellers have good and marketable
title to (or in the case of any leased or licensed Acquired Asset,
have a valid leasehold interest in or valid rights to use), are the
exclusive legal and equitable owners of (or in the case of any
leased or licensed Acquired Asset, are the licensees or lessees
of), and have (or subject to entry of the Sale Order will have) the
unrestricted power and right to sell, assign and deliver, the
Acquired Assets. The Acquired Assets are free and clear of all
Liens and Claims, except for (i) restrictions imposed in any
Governmental Approval, (ii) Liens disclosed on
Section 3.08 of the Seller Disclosure Schedule, which
will be removed and released at or prior to the Closing upon and
subject to entry of the Sale Order, and (iii) Permitted Liens.
Upon the Closing and subject to entry of the Sale Order, Buyer
(directly or through its designated Affiliate(s)) will acquire
exclusive, good and marketable title (or in the case of any leased
or licensed Acquired Asset, a valid leasehold interest in or valid
rights to use) the Acquired Assets and no restrictions will exist
on the right of Buyer (or its designated Affiliates(s)) to resell,
license or sublicense any of the Acquired Assets or Assumed
Obligations or engage in the Business.
(b) The Acquired Assets include all
the assets necessary to perform all Assumed Obligations and to
permit Buyer to conduct the Business after the Closing (i) in
the manner in which Sellers have conducted the Business in the
Ordinary Course of Business, and (ii) in material compliance
with all Laws.
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(c) Each of Exhibits
2.01(a)(i) , 2.01(a)(ii) , 2.01(a)(iii) ,
2.01(a)(iv) , 2.01(a)(v) and 2.01(a)(vi) sets
forth a true, correct and complete list of all Acquired Assets
based on the descriptions in Sections 2.01(a)(i) ,
2.01(a)(ii) , 2.01(a)(iii) , 2.01(a)(iv) ,
2.01(a)(v) and 2.01(a)(vi) , respectively, of this
Agreement, except as set forth on Exhibit D
hereto.
(d) All Deposits and Advances are in
cash notwithstanding the reference to “bonds” in
Exhibit 2.01(a)(vi) other than letters of credit.
(e) All personal property included
in the Acquired Assets are (i) in good operating condition and
repair, ordinary wear and tear excepted, and (ii) suitable and
adequate for continued use in the manner in which they are
presently being used.
(f) Prior to the Effective Time,
Sellers were not required to hold, and following the Effective
Time, Buyer will not be required to obtain or hold, a
contractor’s license in order to perform Sellers’
obligations under the Assumed Executory Contracts in accordance
with applicable Law, collect Receivables, or otherwise conduct the
Business in the Ordinary Course of Business, and the failure of
either Sellers or Buyer to obtain or hold a contractor’s
license does not constitute a Material Adverse Effect.
(g) This Section 3.08 is
not intended to have application with respect to Seller
Intellectual Property Assets, as to which Section 3.10
shall apply.
3.09 Tax Matters .
(a)(i) Sellers have timely filed, or
there have been timely filed on Sellers’ behalf, all Tax
Returns required to be filed with the appropriate Governmental
Authorities in all jurisdictions in which such Tax Returns are
required to be filed (taking into account any extension of time to
file granted or to be obtained on behalf of Sellers), and
(ii) all Taxes payable with respect to such Tax Returns have
been paid, except in the case of (i) or (ii) above to the
extent (x) Buyer (or its designated Affiliate(s)) could not
become liable for any such Taxes, (y) the failure to file or
pay could not result in any Lien (other than a Permitted Lien) on
the Acquired Assets or (z) the failure to file or pay could
not adversely affect the Business. There are no Liens with respect
to Taxes upon any of the Acquired Assets.
(b) No Governmental Authority has
claimed that the Acquired Assets are subject to Tax in a
jurisdiction in which the required Tax Returns have not been filed
by Sellers.
(c) No material issues have been
raised in writing in any audits, examinations or disputes
pertaining to Taxes arising from the Acquired Assets that would
reasonably be expected to have a Material Adverse Effect or cause
Buyer to incur any Liability for unpaid Taxes relating to periods
prior to the Effective Time.
(d) Sellers have not waived any
statute of limitations or agreed to any extension of time with
respect to a Tax assessment or deficiency.
(e) Sellers do not, and as of the
Effective Time, will not, have any Liabilities for unpaid Taxes for
which Buyer (or its designated Affiliate(s)) may become liable as a
result of the transactions contemplated by this
Agreement.
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3.10 Seller Intellectual Property
and Technology .
(a) Section 3.10(a) of
the Seller Disclosure Schedule contains a true and complete list of
all (i) Registered Seller Intellectual Property, specifying as
to each item the applicable jurisdiction and registration or
application number, and (ii) Seller-owned unregistered
trademarks, trade names and service marks that are material to the
conduct of the Business.
(b) All Business License Agreements
are in full force and effect, and enforceable in accordance with
their terms. Sellers are (and, to Sellers’ Knowledge, all
other applicable parties are) in compliance with, and have not
breached any term of, any such Business License Agreements, except
for such non-compliance or breach which would not reasonably be
expected to have a Material Adverse Effect. No Business License
Agreement grants to any Person any exclusive right with respect to
any Owned Seller Intellectual Property Asset. Following the Closing
Date, unless otherwise provided in the Sale Order (and/or unless
not assumed by Buyer) and assuming all consents required under the
terms of the Business License Agreements are obtained, Buyer (or
its designated Affiliate(s)) will have the right to exercise all of
Sellers’ rights under the Business License Agreements, to the
same extent that Sellers would have had, and been able to exercise,
had this Agreement not been entered into and the transactions
contemplated hereby not occurred, without the payment of any
additional amounts or consideration other than ongoing fees,
royalties or payments which Sellers would otherwise have been
required to pay in any case.
(c) Sellers own or have the right to
use, and at the Closing (subject to the assumption stated in the
next sentence) will assign and transfer to Buyer (or its designated
Affiliate(s)) to the full extent (unless otherwise provided in the
Sale Order) of such ownership or use interest, all Seller
Intellectual Property Assets. Upon the Closing, assuming all
consents required under the term of the applicable Business License
Agreements are obtained and unless otherwise provided in the Sale
Order, each of the Seller Intellectual Property Assets will be
owned by Buyer (or its designated Affiliate(s)) or will be
immediately available for use by Buyer (or its designated
Affiliate(s)) upon terms and conditions substantially identical to
those under which Sellers presently use such Seller Intellectual
Property Assets, without any affirmative act by Buyer (or its
designated Affiliate(s)) or any other Person. There are no
royalties, fees, or other amounts payable by Sellers (or that will
be payable by Buyer (or its designated Affiliate(s)) following the
Closing) to any third Person by reason of the ownership, use,
license, sale, or disposition of any Seller Intellectual Property
Asset.
(d) To Sellers’ Knowledge,
neither the conduct of the Business nor any Seller Product
infringes, misappropriates, uses or discloses without
authorization, or otherwise violates any Intellectual Property
Right of any Person, and Sellers have not received any oral,
written, or other communication regarding or claiming (and is not
currently involved in any pending or threatened Proceeding arising
out of) such infringement, misappropriation, unauthorized use or
disclosure, or other violation, except as set forth in
Section 3.10(d) of the Seller Disclosure Schedule.
Sellers have no Knowledge that any of the Seller Intellectual
Property Assets is being infringed, misappropriated, used or
disclosed without authorization, or otherwise violated by any
Person. To Sellers’ Knowledge, all Registered Seller
Intellectual Property Assets are valid and in full force, all
Registered Seller Intellectual Property was prosecuted in good
faith, and no Registered Seller Intellectual Property is involved
in any interference, reexamination, cancellation, opposition or
similar Proceeding.
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(e) Sellers have taken reasonable
steps consistent with practice by similarly sized companies in
Sellers’ industry sufficient to safeguard and maintain the
secrecy and confidentiality of, and its proprietary rights in, all
trade secrets and other information and materials not generally
known to the public that are included in the Owned Seller
Intellectual Property Assets. Without limitation of the foregoing,
Sellers have obtained valid and enforceable confidentiality and
inventions assignment agreements from all of its past and present
employees and independent contractors sufficient to (i) assign
to Sellers all right, title and interest in and to any Technology
and Intellectual Property Rights arising from or developed or
delivered to Sellers in connection with such Person’s work
for or on behalf of Sellers, and (ii) provide reasonable
protection for the confidential and proprietary information and
trade secrets of Sellers. No such employee or independent
contractor has (or immediately following the Closing, will have)
any right, title, or interest in any Owned Seller Intellectual
Property Asset, and to Sellers’ Knowledge no such employee or
independent contractor is in breach of any such confidentiality or
inventions assignment agreement.
(f) Assuming all consents required
under the Business License Agreements are obtained, the execution
and delivery of this Agreement, and unless otherwise provided in
the Sale Order, the performance of this Agreement and the
consummation of the transactions contemplated hereby, will not:
(i) breach, violate, or conflict with any Business License
Agreement or other agreement governing any Seller Intellectual
Property Asset, (ii) cause the forfeiture or termination or
give rise to a right of forfeiture or termination of any Business
License Agreement or Seller Intellectual Property Asset, or
(iii) impair the right of Buyer (or its designated
Affiliate(s)) to enforce any Business License Agreement, or to use
or bring any action for the unauthorized use or disclosure,
infringement, or misappropriation of any Seller Intellectual
Property Asset, except in the case of (i) as would not
reasonably be expected to have a Material Adverse
Effect.
(g) The Seller Intellectual Property
Assets include all of the Intellectual Property Rights and
Technology used in and/or necessary to the conduct of the Business
as currently conducted, including, without limitation, the design,
development, distribution, marketing, manufacture, use, import,
license, and sale of Seller Products.
3.11 Compliance with Laws
.
(a) Sellers are, and at all times
since January 1, 2008 have been, in compliance, with each Law
that is applicable to Sellers or any of their properties, assets
(including the Acquired Assets), operations or businesses
(including the Business), and no event has occurred, and no
condition or circumstance exists, that might (with or without
notice or lapse of time) constitute, or result directly or
indirectly in, a default under, a breach or violation of, or a
failure to comply with, any such Law, except for such failures to
comply, defaults, breaches or violations that, individually or in
the aggregate, would not reasonably be expected to have a Material
Adverse Effect. Sellers have not received any written notice from
any Third Party, including any Government Authority, regarding any
actual, alleged or potential violation of any Law.
14
(b) To the Knowledge of Sellers, no
Governmental Authority has proposed or is considering any Law that
may affect Sellers, Sellers’ properties, assets (including
the Acquired Assets), operations or businesses (including the
Business), or Sellers’ rights thereto, except to the extent
that any such Law, if adopted or otherwise put into effect,
individually or in the aggregate, would not reasonably be expected
to have a Material Adverse Effect.
3.12 Employee Matters .
Sellers and their ERISA Affiliates do not sponsor, participate in
or contribute to and have not in the past sponsored, participated
in or contributed to and have no current or contingent obligation
with respect to (a) any Seller Employee Benefit Plan that is
subject to Title IV of ERISA, (b) any “multiemployer
plan” as defined in Section 3(37) of ERISA or any Seller
Employee Benefit Plan maintained pursuant to a collective
bargaining agreement, (c) any plan or arrangement that
provides medical benefits, death benefits or other welfare benefits
following termination of employment, other than pursuant to the
terms of employment agreements with executive officers that are not
Assumed Executory Contracts and except to the extent required by
Part 6 of Title I of ERISA or any similar state or foreign law, or
(d) any “welfare benefit fund” within the meaning
of Section 419 of the IRC. There is no organized labor strike,
dispute, slowdown, lockout, work stoppage or labor strike or unfair
labor practice claim pending against Sellers or reasonably
anticipated, or, to the Knowledge of Sellers, threatened with
respect to Sellers’ employees. To the Knowledge of Sellers,
there are no activities or proceedings of any labor union or
organization to organize any of Sellers’ employees. There are
no actions, suits, claims, labor disputes or grievances pending,
or, to the Knowledge of Sellers, threatened or reasonably
anticipated relating to any labor, safety, wage and hour, contract,
tort, retaliation, discrimination or other labor and employment
matters involving any of Sellers’ employees, including
charges of unfair labor practices, discrimination complaints, or
matters arising under the Worker Adjustment and Retraining
Notification Act, as amended, or any similar state or foreign plant
closing or mass layoff laws. Sellers are not presently, nor have
they been in the past, a party to, or bound by, any collective
bargaining agreement or union contract, formal or informal with
respect to Sellers’ employees and no collective bargaining
agreement is being negotiated by Sellers with respect to any of
Sellers’ employees.
3.13 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 based upon arrangements
made by or on behalf of Sellers.
3.14 Estimated Cure Costs .
To Sellers’ Knowledge, Section 3.14 of the Seller
Disclosure Schedule sets forth a true and complete list of the
Estimated Cure Cost for each Assumed Executory Contract and
Potential Assumed Executory Contract.
3.15 Governmental Approvals .
Except with respect to Governmental Approvals that are solely
related to the Excluded Assets, Section 3.15 of the
Seller Disclosure Schedule sets forth a true and complete list of
each Governmental Approval required for, or useful in, the
continued operation of the Business and facilities acquired
hereunder after the Closing in substantially the same manner as
such Business and facilities have been operated by Seller during
the six months prior to the Closing and in substantially the same
manner as is customary in the industry, including: (a) the
expiration date thereof and (b) the applicable facility or
Acquired Assets to which such Governmental Approval is
related.
15
3.16 Contractual Requirements
. Section 3.16 of the Seller Disclosure Schedule sets
forth a true and complete list of each of the following items that
are or may be necessary or required pursuant to the terms of the
Assumed Executory Contracts or Potential Assumed Executory
Contracts, including, as applicable, any required minimum dollar
amounts: (a) letters of credit, (b) surety bonds,
(c) restricted cash, (d) insurance obligations, or
(e) other similar arrangements with any Third
Parties.
3.17 Environmental Matters .
Sellers (a) are not engaging in, will not engage in and never
have engaged in any activities that would be subject to or within
the scope of Tennessee Radioactive Materials License (No.
R-79310-F19(2)), (b) have completed, are no longer engaging in
and will not engage in, any activities subject to or within the
scope of Arizona DEQ De Minimus Discharge Permit (No. AZDGP-01202)
and (c) are not subject to any continuing or future
requirements, including monitoring requirements, pursuant to the
Permits referenced in (a) or (b) of this
Section 3.17 .
3.18 Use of npRio Media
.
(a) No arsenic treatment unit or
other Machinery and Equipment that constitute Acquired Assets
require npRio media to be fully operational and may be used with
alternative media;
(b) None of the Assumed Executory
Contracts or Potential Assumed Executory Contracts require the use
of npRio media pursuant to their terms and provisions other than
certain Contracts referred to as AZ-Rancho Rojo, AZ-Rimrock #2,
AZ-Rimrock #3, AZ-Rimrock #4 and AZ-Wild Horse;
(c) There are readily available
alternatives to using npRio media, which are at least as effective
for arsenic removal and generally cost effective as the use of
npRio media; and
(d) There are no units that contain
npRio media that are subject to an Assumed Executory Contract or
Potential Assumed Executory Contract other than certain Contracts
referred to as WESA Tech Inc. (Golden Giant Project) and AZ-Rancho
Rojo, AZ-Rimrock #2, AZ-Rimrock #3, AZ-Rimrock #4 and AZ-Wild
Horse.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
BUYER
Buyer hereby represents and warrants
to Sellers as of the date of this Agreement as follows:
4.01 Organization and Good
Standing . Buyer is a corporation duly organized, validly
existing and in good standing under the laws of Delaware, and has
all requisite power and authority to own, lease and operate its
properties and to carry on its business as now being
conducted.
16
4.02 Authority . Buyer has
all necessary corporate power and authority to execute and deliver
this Agreement and the other Transaction Documents, to perform its
obligations hereunder and thereunder, and to consummate the
transactions contemplated by this Agreement and the other
Transaction Documents. The execution, delivery and performance of
this Agreement and the other Transaction Documents and the
consummation by Buyer of the transactions contemplated by this
Agreement and the other Transaction Documents have been duly and
validly authorized by all requisite corporate action and no other
corporate proceedings on the part of Buyer are necessary to
authorize this Agreement or the other Transaction Documents or to
consummate the transactions contemplated hereby or thereby. This
Agreement has been, and at the Closing the other Transaction
Documents will be, duly and validly executed and delivered by Buyer
(or its designated Affiliate(s)). This Agreement constitutes, and
at the Closing the other Transaction Documents will constitute, the
legal, valid and binding obligation of Buyer(or its designated
Affiliate(s)), enforceable against Buyer (or its designated
Affiliate(s)) in accordance with their respective terms, except as
may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws and equitable principles related
to or limiting creditors’ rights generally and by the
availability of equitable remedies and defenses.
4.03 No Conflicts; Required
Consents . Subject to the entry of the Sale Order, the
execution, delivery and performance of this Agreement and the other
Transaction Documents by Buyer do not and will not, with or without
notice or lapse of time:
(a) conflict with, violate or result
in any breach of any of the provisions of Buyer’s
organizational documents;
(b) conflict with or violate any Law
or Order applicable to Buyer or its assets, properties or
businesses; or
(c) require Buyer to obtain any
Consent with respect to any contract to which it is a party or
Governmental Approval or make or deliver any filing or notice to a
Governmental Authority, other than filings with the Bankruptcy
Court.
4.04 Legal Proceedings .
Other than the Bankruptcy Case, there are no material Proceedings
pending or, to the knowledge of Buyer, threatened against, relating
to or affecting Buyer’s ability to perform its obligations
under the Transaction Documents or to consummate the transactions
contemplated hereby or thereby.
4.05 Condition of the
Business . Notwithstanding anything contained in this Agreement
to the contrary, Buyer acknowledges and agrees that Sellers are not
making any representations or warranties whatsoever, express or
implied, beyond those expressly given by Sellers in ARTICLE 3
hereof (as modified by the Seller Disclosure Schedules), and Buyer
acknowledges and agrees that, except for the representations and
warranties contained therein, the Acquired Assets and the Business
are being transferred on a “as is” and “where
is” basis. Buyer acknowledges that it has conducted to its
satisfaction its own independent investigation of the Business and
the Acquired Assets in making the determination to proceed with the
transactions contemplated by this Agreement.
4.06 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 based upon arrangements
made by or on behalf of Buyer.
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ARTICLE 5
PRE-CLOSING
COVENANTS
5.01 Sellers’ Conduct of
the Business Prior to the Closing . From the date of this
Agreement until the earlier of the termination of this Agreement in
accordance with its terms and the Closing Date, Sellers covenant
and agree to use commercially reasonable efforts, taking into
account Basin Water’s status as a debtor-in-possession, to
ensure that the Business shall be conducted only in, and Sellers
shall not take any action except in, the Ordinary Course of
Business, except for any such action required by Law or the
Bankruptcy Court Orders, and Sellers shall use commercially
reasonable efforts to preserve substantially intact in all material
respects the business organization of Sellers, to keep available
the services of the current officers, employees, independent
contractors and consultants of Sellers and to preserve the current
relationships of Sellers with customers, suppliers and other
Persons with which Sellers have significant business relations.
Without limiting the generality of the foregoing, from the date of
this Agreement until the earlier of the termination of this
Agreement in accordance with its terms and the Closing Date, except
as specifically contemplated by this Agreement, or otherwise
required by the Bankruptcy Court Orders, Sellers shall not,
directly or indirectly, do or propose to do any of the following
without the prior written consent of Buyer:
(a) Enter into any commitment or
transaction not in the Ordinary Course of Business, except for the
commencement of the Bankruptcy Case and any such commitment or
transaction required by the Bankruptcy Court Orders;
(b) Terminate any employees or
service providers of Seller listed on Exhibit N-1
;
(c) Enter into any transaction with
its officers, directors or stockholders or their Affiliates, except
reimbursement of reasonable travel expenses related to work
performed for Sellers incurred in the Ordinary Course of Business,
or related to the transactions contemplated by this Agreement, by
officers and directors, or as required by the terms of any Contract
or Seller Employee Benefit Plan in effect as of the date of this
Agreement or as approved thereafter by the Bankruptcy
Court;
(d) Amend or otherwise modify the
material terms of any Assumed Executory Contract, Potential Assumed
Executory Contract or Governmental Approval, except as set forth in
Section 5.10;
(e) Transfer to any Person any
rights with respect to any Seller Intellectual Property Assets
other than nonexclusive licenses entered into in the Ordinary
Course of Business;
(f) Sell, lease, license or
otherwise dispose of any of the Acquired Assets outside of the
Ordinary Course of Business, except for any such sale, lease,
license or other disposition required by the Bankruptcy Court
Orders;
18
(g) Commence a Proceeding other than
(i) Proceedings for the routine collection of Receivables,
(ii) Proceedings required by the Bankruptcy Court Orders or
(iii) Proceedings (including the filing of motions) before the
Bankruptcy Court that are customary in a Chapter 11 bankruptcy case
and that would not be reasonably expected to delay the
Closing
