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Asset Purchase Agreement

 

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Title:

Asset Purchase Agreement

Entities:

Adaptec Inc.; Adaptec Inc.; Napster Inc; Roxio, Inc.; Heller Ehrman White & McAuliffe

Date:

2003

Size:

Preview shows 33KB of 131KB total

Price:

$67

ID:

#1392103

 

 

► Purchase & Sale ► Purchase ► Asset Purchase Agreements
► Technology ► Semiconductors
► Technology ► Software & Programming
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ASSET PURCHASE AGREEMENT

 

RELATING TO THE GOBACK PRODUCT LINE

 

BY AND AMONG

 

SYMANTEC CORPORATION,

 

SYMANTEC LIMITED,

 

ROXIO, INC.,

 

WILD FILE, INC.

 

AND

 

ROXIO CI, LTD.

 

April 17, 2003

 



 

ASSET PURCHASE AGREEMENT

 

This ASSET PURCHASE AGREEMENT (this Agreement) is made and entered into as of April 17, 2003 by and among Symantec Corporation, a Delaware corporation (Buyer), Symantec Limited, an entity organized under the laws of Ireland (which is a party hereto for purposes of Section 5.1 hereof only), Roxio, Inc., a Delaware corporation (Roxio), Wild File, Inc., a Delaware corporation (Wild File), and Roxio CI, Ltd., a Cayman Islands limited company (RCI, together with Roxio and Wild File, collectively, Seller).

 

RECITALS

 

A. Roxio is engaged in the business of developing media software. Among its various products is the GoBack system recovery software, which enables users to revert their hard drives to a former condition at a previous point in time and is designed to allow users to recover from system crashes, virus attacks or user errors. The GoBack product and all products and versions thereof (including enterprise and consumer versions), including those currently under development by Seller, and all software code primarily related to or otherwise necessary for such products, are referred to herein as the Products, and the business, activities and operations of Seller with respect to the Products, including the development, design, manufacturing, sale and distribution thereof (but excluding general functions such as human resources, accounting, legal or other general and administrative services), are referred to herein as the Business. Wild File and RCI also hold certain assets related to the Business.

 

B. Seller desires to sell and assign to Buyer, and Buyer desires to purchase and acquire from Seller, certain assets related to the Business on the terms and conditions set forth in this Agreement.

 

C. Concurrently herewith, Buyer and Seller are entering into an escrow agreement (the Escrow Agreement) pursuant to which a portion of the purchase price to be paid by Buyer hereunder will be held as collateral for Sellers indemnification obligations hereunder.

 

D. Concurrently herewith, Buyer and Seller are also entering into a transition services agreement (the Transition Services Agreement) pursuant to which Roxio shall continue to provide certain services to Buyer as specified therein for the period of time specified therein in order for Buyer to conduct the Business in an uninterrupted fashion after the date hereof.

 

NOW, THEREFORE, in consideration of the facts recited above and the mutual agreements set forth herein, the parties hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

1.1 Certain Defined Terms. As used in this Agreement, the following terms will have the following meanings:

 

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Accounts Receivable means all trade accounts receivable and any other evidences of indebtedness of and rights to receive payment and the full benefit of all security for such accounts or rights to payment, in each case that would be characterized as accounts receivable in accordance with GAAP (as defined below).

 

affiliate means, with respect to any specified person, any other person that directly or indirectly controls, is controlled by, or is under common control with, such specified person (where, for purposes of this definition, 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 policies of a person, whether through the ownership of stock, as an officer, director, trustee or executor, by contract or otherwise).

 

Buyer Ancillary Agreements means the Transition Services Agreement, Assignment and Assumption Agreement and all other documents that Buyer is to execute and deliver pursuant hereto.

 

Change of Control means, with respect to either of Buyer or Seller, any of the following: (i) any sale or transfer of all or substantially all of the assets of such party; (ii) any merger, consolidation or other business reorganization in which the holders of such partys outstanding voting securities immediately prior to such transaction do not hold, immediately following such transaction, securities representing 50% or more of the combined voting power of the outstanding securities of the surviving entity; or (iii) the acquisition by any person (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, as amended (the Exchange Act), of beneficial ownership (within the meaning of Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of securities representing 50% or more of the combined voting power of the then-outstanding securities of such party.

 

Code means the Internal Revenue Code of 1986, as amended, and the rulings and regulations promulgated thereunder.

 

Contract means any written, oral or other agreement, contract, subcontract, lease, binding understanding, promise, instrument, note, option, warranty, purchase order, license, sublicense, insurance policy, benefit plan, commitment or undertaking of any nature, as of the date hereof or as may hereafter be in effect.

 

Documentation means, collectively, programmers notes or logs, source code annotations, user guides, manuals, instructions, software architecture designs, layouts, any know-how, and any other designs, plans, drawings, documentation, materials, supplier lists, software source code and object code, net lists, photographs, development tools, blueprints, media, memoranda and records that are primarily related to or otherwise necessary for the use and exploitation of any Seller Technology Assets, whether in tangible or intangible form, whether owned by Seller or held by Seller under any licenses or sublicenses (or similar grants of rights).

 

Employee Plan means each employment and consulting Contract, pension, retirement, disability, medical, dental or other health plan, life insurance or other death benefit plan, profit sharing, deferred compensation agreement, stock, option, bonus or other incentive plan, vacation,

 

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sick, holiday or other paid leave plan, severance plan or other similar employee benefit plan maintained by Seller or any of its affiliates which covers any Employee, including all employee benefit plans as defined in Section 3(3) of ERISA.

 

Employees are those officers and employees of Seller who dedicate a substantial portion of their working hours or who have made substantial contributions towards the Business, and consultants and independent contractors who perform services in connection with the Business.

 

Encumbrance means any pledge, lien, collateral assignment, security interest, deed of trust, mortgage, title retention device, collateral assignment, claim, license or other contractual restriction (including any restriction on the transfer of any asset, the receipt of income derived from any asset or on the possession, exercise or transfer of any other attribute of ownership of any asset), conditional sale or other security arrangement, or any charge, adverse claim of title, ownership or right to use or any other encumbrance of any kind whatsoever.

 

ERISA means the Employee Retirement Income Security Act of 1974, as amended.

 

Escrow Agent shall have the meaning ascribed to such term in the Escrow Agreement.

 

GAAP means generally accepted accounting principles at the time of any determination, which are applied on a consistent basis. All accounting terms used in this Agreement shall have the meanings given to those terms by GAAP, unless the context of this Agreement otherwise requires.

 

Governmental Authority means any (a) nation, province, state, county, city, town, district or other jurisdiction of any nature; (b) federal, provincial, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official or entity and any court or other tribunal); (d) multi-national organization or body; or (e) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature.

 

Intellectual Property Rights means, collectively, all intellectual property rights enforceable anywhere in the world, including patents, patent applications, patent rights, trademarks, trademark registrations and applications therefor, trade dress rights, trade names, service marks, service mark registrations and applications therefor, Internet domain names, Internet and world wide web URLs or addresses, copyrights, copyright registrations and applications therefor, mask work rights, mask work registrations and applications therefor, franchises, licenses, inventions, trade secrets, know-how, customer lists, supplier lists, proprietary processes and formulae, software source code and object code, algorithms, net lists, architectures, structures, screen displays, photographs, images, layouts, development tools, designs, blueprints, specifications, technical drawings (or similar information in electronic format) and all documentation and media constituting, describing or relating to the foregoing, including manuals, programmers notes, memoranda and records.

 

Key Employees means those persons identified on Schedule 1.1 hereto.

 

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knowledge an individual will be deemed to have knowledge of a particular fact, circumstance, event or other matter if (a) such individual is actually aware of such fact or other matter, including, with respect to Seller only, (b) a reasonably prudent individual in such individuals position could reasonably be expected to discover or otherwise become aware of such fact or other matter in the course of conducting his or her duties (including review of documents and records, whether written or electronic, including e-mails sent to or by such individual). Buyer will be deemed to have knowledge of a particular fact or other matter if an officer or director of Buyer has knowledge (as defined above) of such fact or other matter. Roxio will be deemed to have knowledge of a particular fact or other matter if an officer, director, or any of the following employees has knowledge (as defined above) of such fact or other matter: Kamal Arafeh, Elliot Carpenter, Philippe Cassereau, Chris Gorog, William Growney, Tom Shea, Stephen Stange and each of the Key Employees.

 

Legal Requirement means any law, statute, constitution, principle of common law, resolution, ordinance, code, edict, order, judgment, decree, injunction, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any Governmental Authority.

 

Liabilities means debts, liabilities and obligations, whether accrued or fixed, absolute or contingent, matured or unmatured, determined or determinable, known or unknown, including those arising under any law (under law or equity and under any theory of liability), action or governmental order and those arising under any Contract.

 

Licensed IP means those Seller IP Rights (as defined in Section 3.11(a)) that are identified on Schedule 2.9.

 

person means any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity.

 

Seller Ancillary Agreements means the Escrow Agreement, Transition Services Agreement, Bill of Sale, the Assignment and Assumption Agreement and all other assignments, certificates and documents that Seller is required to execute and deliver pursuant to this Agreement.

 

Seller Technology Assets means, collectively, all computer software (including software programs, objects, modules, routines, algorithms and any other software code) in both source code and object code form, copyrightable works, inventions (whether or not patentable), trade secrets (including Sellers customer list), know-how, processes, designs, techniques, confidential business information (including Sellers customer list), and other proprietary information and technologies used primarily in, or which are otherwise necessary for, conducting the Business, including without limitation any of the above related to software programs and updates, upgrades, new versions and new releases of such software programs currently under development by or for Seller, whether owned by Seller or held by Seller under any licenses or sublicenses (or similar grants of rights) excluding the Licensed IP and the Excluded Assets (as defined in Section 2.2). The Seller Technology Assets include, but are not limited to, the assets described on Exhibit A attached hereto.

 

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Tax or Taxes means foreign, federal, state and local taxes of any kind whatsoever (whether payable directly or by withholding), including alternative or add-on minimum income, gains, employment, license, documentary, stamp, occupation, recording, transfer, sales, use, excise, franchise, ad valorem, property, property transfer, inventory, value added, withholding and payroll taxes (including all taxes or other payments required to be withheld by an employer and paid over to any Governmental Authority), or other similar governmental charges, fees, customs, duties, levies or assessments, together with any estimated tax, interest, fines and penalties or additions to tax and interest on such fines, penalties and additions to tax.

 

ARTICLE II

 

PURCHASE AND SALE OF PURCHASED ASSETS

 

2.1 Sale and Purchase. Subject to the terms and conditions of this Agreement and in reliance on the representations, warranties and covenants set forth in this Agreement, Seller hereby sells, assigns, transfers, conveys and delivers to Buyer, and Buyer hereby purchases and acquires, all right, title and interest in and to the Purchased Assets (as defined in Section 2.2), free and clear of all Encumbrances whatsoever, except for Encumbrances upon portions of the Purchased Assets that are specifically identified in Schedule 3.11(h) or Schedule 3.11(m).

 

2.2 Purchased Assets and Excluded Assets Defined. As used in this Agreement, the term Purchased Assets will mean all of the assets and properties (excepting only the Excluded Assets) of every kind and description, wherever located, personal or mixed, tangible or intangible, primarily related to or otherwise necessary for the conduct of the Business by Seller as of the date of this Agreement, including without limitation the following:

 

(a) all of the Seller Technology Assets;

 

(b) all of the Documentation;

 

(c) any and all copies in a tangible medium and any and all other tangible embodiments of all of the Seller Technology Assets and all of the Documentation;

 

(d) all Seller IP Rights (as defined in Section 3.11(a)) in and to the Seller Technology Assets and the Documentation, including all patents, rights in patent applications and invention rights listed in the Patent Assignment (as defined in Section 2.7(f)) and all marks, copyrights and domain names listed in the Other IP Assignments (as defined in Section 2.7(g)), but excluding the Licensed IP, and;

 

(e) all Accounts Receivable of Seller arising out of or in connection with the Business (including, without limitation and for purposes of clarity, Accounts Receivable from enterprise and any other customers under Assigned Agreements);

 

(f) those agreements listed on Exhibit B attached hereto (collectively, the Assigned Agreements); and

 

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(g) copies of Sellers marketing and sales information, pricing, marketing plans, business plans, financial and business projections and other files and records (or applicable portions thereof) pertaining to the Purchased Assets and the Business.

 

As used in this Agreement, the term Excluded Assets means any asset of Seller not included as a Purchased Asset hereunder. All Excluded Assets will be retained by Seller or its licensors and will not be sold, assigned, transferred or conveyed to Buyer.

 

2.3 Assumption of Specified Liabilities; Exclusion of Liabilities. Subject to the terms and conditions of this Agreement, Buyer hereby assumes and agrees to pay, perform and discharge when due only (i) those Liabilities of Seller under any Assigned Agreements, but only to the extent that such Liabilities accrued or arose after the date of this Agreement for reasons other than any breach, violation or default by Seller of the terms of the Assigned Agreements, (ii) any Liabilities to the extent that they relate to or arise out of Products shipped or services performed by Buyer on or after the date hereof (provided, however, Buyer Indemnified Persons, as defined in Section 8.1, shall not be precluded from making claims for indemnification by Seller with respect to such Products shipped or services performed to the extent a Buyer Indemnified Person is so entitled pursuant to Article VIII hereof) and (iii) Liabilities arising from (A) returns by distributors or other third parties of Products shipped by Seller (other than with respect to Products shipped to distributors on a consignment basis) solely in connection with the Business as of or prior to the date of this Agreement, and (B) express return, guaranty and warranty obligations for Products shipped and services performed by Seller solely in connection with the Business as of or prior to the date of this Agreement (clauses (A) and (B) collectively, Return and Warranty Obligations), not to exceed, in the aggregate, $75,000 of cancelled accounts receivable, refunds or costs to Buyer for materials and labor (clauses (i), (ii) and (iii) collectively, the Assumed Liabilities).

 

2.4 No Other Liabilities Assumed. As a material consideration and inducement to Buyer to enter into this Agreement, Seller hereby retains, and is solely responsible for paying, performing and discharging when due, and Buyer does not assume or otherwise have or acquire any responsibility or Liability for, any and all Liabilities of Seller, whether now existing or hereafter arising (other than the Assumed Liabilities), including, by way of example and not by way of limitation, the following:

 

(a) any and all Taxes now or hereafter due and payable by Seller or any affiliate of Seller, including any Taxes on, or arising from, the Business prior to the date of this Agreement, and any related Liabilities of Seller and its affiliates;


 

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