asset acquisitions - Jackson Walker LLP

The buyer should also investigate any other procedures used by the seller to maintain thesecrecy of its trade secrets, and the buyer should determine whether agreements exist thatgovern the disclosure and use of trade secrets by employees and consultants of the seller andothers who need to learn of them. The seller may seek a knowledge qualification to the lastsentence of clause (iii) of Section 3.25(g) because of the difficulty in determining that tradesecrets do not infringe any third party’s intellectual property. As previously stated, whetherthe buyer accepts this is a matter of risk allocation.Mask Works. Mask works are related to semiconductor products and are protectedunder 17 U.S.C. § 901 et seq. Because this technology is unique to a particular industry (themicrochip industry), the Model Agreement does not contain a representation concerningmask works.Domain Names. Internet domain names may be obtained through a registrationprocess. Internet domain name registration is a process which is separate and independent oftrademark registration, but registering another’s trademark as a domain name for the purposeof selling it to the trademark owner (“cybersquatting”) or diverting its customers(“cyberpiracy”) may be actionable as unfair competition, trademark infringement or dilutionor under Section 43(d) of the Lanham Act (the “Anticybersquatting Consumer ProtectionAct”). Domain name disputes may also be resolved under the ICANN Rules for UniformDomain Name Dispute Resolution.3.32 SOLVENCY(a) Seller is not now insolvent, and will not be rendered insolvent by any of theContemplated Transactions. As used in this Section, “insolvent” means that the sumSeller’s debts and other probable Liabilities exceeds the present fair saleable value of Seller’sassets.(b) Immediately after giving effect to the consummation of the ContemplatedTransactions, (i) Seller will be able to pay its Liabilities as they become due in the usualcourse of its business, (ii) Seller will not have unreasonably small capital with which toconduct its present or proposed business, (iii) Seller will have assets (calculated at fairmarket value) that exceed its Liabilities and (iv) taking into account all pending andthreatened litigation, final judgments against Seller in actions for money damages are notreasonably anticipated to be rendered at a time when, or in amounts such that, Seller will beunable to satisfy any such judgments promptly in accordance with their terms (taking intoaccount the maximum probable amount of such judgments in any such actions and theearliest reasonable time at which such judgments might be rendered) as well as all otherobligations of Seller. The cash available to Seller, after taking into account all otheranticipated uses of the cash, will be sufficient to pay all such debts and judgments promptlyin accordance with their terms.COMMENTMost jurisdictions have statutory provisions relating to fraudulent conveyances ortransfers. The Uniform Fraudulent Transfer Act (“UFTA”) and Section 548 of the UnitedStates Bankruptcy Code (the “Bankruptcy Code”) generally provide that a “transfer” isvoidable by a creditor if the transfer is made (i) with actual intent to hinder, delay or defraud3148166v1- 106 -