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Exhibit 4.4
AGREEMENT
AGREEMENT, dated as of July 20, 1998, by and among National Network
Technologies, Inc., a corporation organized and existing under the laws of the
State of Delaware (the "Company"), ▇▇▇▇ ▇'▇▇▇▇ Electric Co., Inc., a corporation
organized and existing under the laws of the State of New York (the
"Predecessor") and ▇▇▇▇▇ ▇. ▇'▇▇▇▇, a resident of the State of New York.
WHEREAS the Company and the Predecessor entered into that certain Merger
Agreement dated on or about July 22, 1998 (the "Merger Agreement"), pursuant to
the terms of which, the Predecessor shall be merged with and into the Company
(the "Merger"), with the Company surviving and continuing in existence under the
provisions of the General Corporation Law of the State of Delaware (the "DGCL");
and
WHEREAS the Company, ▇▇▇▇▇ ▇. ▇'▇▇▇▇, ▇▇▇▇ ▇'▇▇▇▇, ▇▇. and ▇▇▇▇▇ ▇'▇▇▇▇,
and ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ III, L.P. and ▇▇▇▇▇▇ Capital 1330 Investors I, L.P.
intend to enter into that certain Securities Purchase Agreement dated as of July
23, 1998 (the "Securities Purchase Agreement"), pursuant to the terms of which
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ III, L.P. and ▇▇▇▇▇▇ Capital 1330 Investors I, L.P.
shall purchase 5,538,458 shares of Series A Convertible Preferred Stock, $.001
par value, of the Company for $11.5 million (the "Securities Purchase"); and
WHEREAS ▇▇▇▇▇ ▇. ▇'▇▇▇▇ is a shareholder of the Predecessor;
NOW, THEREFORE, as a material inducement to ▇▇▇▇▇ ▇. ▇'▇▇▇▇ to enter into
and perform his obligations under the Merger Agreement and the Securities
Purchase Agreement, each of the Company and the Predecessor hereby agree as
follows:
1. ▇▇▇▇▇ ▇. ▇'▇▇▇▇'▇ interest in the Company following the consummation of
the Merger and the Securities Purchase shall be four and 17/100ths percent
(4.17%) of the capital stock of the Company, which stock shall be fully paid and
non-assessable. ▇▇▇▇▇ ▇. ▇'▇▇▇▇'▇ holding of capital stock of the Company shall
be subject to dilution only (i) by the same percentage amount applicable to each
of the shareholders of the Company's capital stock, such that, for example, if
the amount of stock held by one of the shareholders is to be diluted by 2%, then
the amount of stock held by ▇▇▇▇▇ ▇. ▇'▇▇▇▇ shall be diluted only to the extent
of 2%; (ii) to the extent of 417/1000ths percent (0.417%) (yielding a total
holding of 3.7530% of such capital stock) and only in the context of shares
being offered to key executives or employees for purposes of an employee stock
option plan; and (iii) as provided for by the Securities Purchase Agreement and
in accordance with the DGCL in the event of a properly approved future offering
or financing.
2. The Company shall provide ▇▇▇▇▇ ▇. ▇'▇▇▇▇ with lifetime medical,
dental, life and health insurance benefits consistent with ▇▇▇▇▇ ▇. ▇'▇▇▇▇'▇
existing coverage.
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3. The Company agrees to make available to ▇▇▇▇▇ ▇. ▇'▇▇▇▇ the use of a
Chevrolet Suburban for so long as ▇▇▇▇▇ ▇. ▇'▇▇▇▇ remains a shareholder of the
Company. Such automobile shall be replaced at ▇▇▇▇▇ ▇. ▇'▇▇▇▇'▇ option by the
Company every three years, with the first new Chevrolet Suburban to be provided
on or about August 1, 1998. In the event the Company is unable, through no fault
of its own, to procure a current model Chevrolet Suburban by December 31, 1998
or at the end of any such three-year period, the Company shall, at ▇▇▇▇▇ ▇.
▇'▇▇▇▇'▇ option, provide ▇▇▇▇▇ ▇. ▇'▇▇▇▇ with a model of vehicle similar to the
Chevrolet Suburban in both cost and specifications.
4. As of the date hereof, the Predecessor holds the title to the following
automobiles: (a) 1996 Mercedes 420S; and (b) 1984 Mercedes Station Wagon.
Following the consummation of the Merger and the Securities Purchase, the
Company shall offer to ▇▇▇▇▇ ▇. ▇'▇▇▇▇ the 1996 Mercedes 420S for $35,000 and
the 1984 Mercedes Station Wagon for $1.00. ▇▇▇▇▇ ▇. ▇'▇▇▇▇ shall have the option
of purchasing one or both of these automobiles for such amounts, and this
provision shall in no way be interpreted as requiring ▇▇▇▇▇ ▇. ▇'▇▇▇▇ to
purchase either or both of these automobiles.
5. The Company agrees to provide without charge to ▇▇▇▇▇ ▇. ▇'▇▇▇▇ an
office for ▇▇▇▇▇ ▇. ▇'▇▇▇▇ at his primary residence and secretarial services at
the Company for so long as ▇▇▇▇▇ ▇. ▇'▇▇▇▇ shall remain a shareholder of the
Company.
6. The Company agrees to provide ▇▇▇▇▇ ▇. ▇'▇▇▇▇ with the following
reports:
(a) As soon as practicable after the end of each fiscal year, and in
any event within 120 days thereafter, consolidated and consolidating balance
sheets of the Company and all direct or indirect subsidiaries of the Company, as
of the end of such fiscal year, and consolidated and consolidating statements of
income and consolidated and consolidating statements of changes in cash flow of
the Company and its subsidiaries for such fiscal year, prepared in accordance
with Generally accepted accounting principles and setting forth in each case in
comparative form the figures for the previous fiscal year and the budgeted
figures for the current fiscal year, all in reasonable detail and audited,
together with a certificate of the Company executed by the chief executive
officer or principal financial or accounting officer of the Company certifying
that all covenants to be complied with by the Company, as provided in the
Securities Purchase Agreement have been complied with (or setting forth in
reasonable detail any covenants that have not been so complied with).
(b) As soon as practicable after the end of the first, second, third
and fourth quarterly accounting periods in each fiscal year of the Company and
in any event within 45 days thereafter, consolidated and consolidating balance
sheets of the Company and all direct and indirect subsidiaries of the Company,
as of the end of each such quarterly period, and consolidated and consolidating
statements of income and consolidated and consolidating statements of change in
cash flow of the Company and its subsidiaries for such period and for the
current fiscal year to date, prepared in accordance with generally accepted
accounting principles
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(other than for accompanying notes), subject to changes resulting from normal
year-end audit adjustments, and setting forth in each case in comparative form
the figures for the same periods of the previous year and the budgeted figures
for the current periods, all in reasonable detail and signed by the principal
financial or accounting officer of the Company, together with a certificate of
the Company executed by the chief executive officer or principal financial or
accounting officer of the Company certifying that all covenants to be complied
with by the Company under the Securities Purchase Agreement have been complied
with (or setting forth in reasonable detail any covenants that have not been so
complied with).
7. The Company agrees to pay all legal fees and other expenses incurred by
▇▇▇▇▇ ▇. ▇'▇▇▇▇ in connection with the Merger, the Securities Purchase, and such
other transactions as relate to the Merger and the Securities Purchase. Provided
the Merger and the Securities Purchase close on or before July 31, 1998, the
maximum of such reimbursement under this provision shall not exceed $40,000.
8. The Company hereby indemnifies ▇▇▇▇▇ ▇. ▇'▇▇▇▇ and shall save and hold
him harmless against and pay on behalf of or reimburse him as and when incurred
for any loss, liability, legal fees, interest, penalty, demand, claim, action,
cause of action, cost, damage, deficiency, tax, fine or expense, arising out of
or related to any claims made by or on behalf of any person or entity, which
▇▇▇▇▇ ▇. ▇'▇▇▇▇ may suffer, sustain or become subject to, as a result of, or in
connection with, relating or incidental to the Company or the Predecessor.
9. ▇▇▇▇▇ ▇. ▇'▇▇▇▇ (i) acknowledges that he has consulted with, and been
advised by, independent counsel with respect to this Agreement and the
transactions contemplated by the Merger Agreement, and the Securities Purchase
Agreement, and that he and his counsel have been provided copies of these and
related agreements; and (ii) acknowledges that he has approved the proposed
transaction contemplated by the Merger Agreement and the Securities Purchase
Agreement, and releases any claims and causes of action with respect to the
Merger and the Securities Purchase Agreement as against the Company, the
Predecessor, ▇▇▇▇ ▇'▇▇▇▇, ▇▇. and ▇▇▇▇▇ ▇'▇▇▇▇; provided, however, that
notwithstanding anything contained herein, ▇▇▇▇▇ ▇. ▇'▇▇▇▇ does not release any
claim or cause of action for breach of (a) this Agreement, (b) the Merger
Agreement, (c) the Securities Purchase Agreement, (d) that certain Stockholders'
Agreement by and among the Company, ▇▇▇▇▇ ▇. ▇'▇▇▇▇, ▇▇▇▇ ▇'▇▇▇▇, ▇▇. and ▇▇▇▇▇
▇'▇▇▇▇, and ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ III, L.P. and ▇▇▇▇▇▇ Capital 1330 Investors
I, LP., dated as of July 23, 1998, (d) that certain Promissory Note dated July
16, 1998, and executed and delivered by the Predecessor to ▇▇▇▇▇ ▇. ▇'▇▇▇▇, (e)
that certain Promissory Note dated January 1, 1997, and executed and delivered
by the Predecessor to ▇▇▇▇▇ ▇. ▇'▇▇▇▇, or (f) that certain Amended and Restated
Promissory Note dated July 23, 1998, and executed and delivered by the Company
to ▇▇▇▇▇ ▇. ▇'▇▇▇▇.
10. This Agreement shall not confer any rights or remedies upon any
individual or legal entity other than the parties and their respective
successors and permitted assigns, personal representatives, heirs and estates,
as the case may be.
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11. This Agreement constitutes the entire agreement among the parties and
supersedes any prior understandings, agreements or representations by or among
the parties, written or oral, that may have related in any way to the subject
matter of this Agreement.
12. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors, heirs, estate and permitted assigns. No
party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of the other parties.
13. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.
14. This Agreement will be governed by and construed in accordance with
the domestic laws of the State of New York, without giving effect to any choice
of law or conflicting provision or rule that would cause the laws of any
jurisdiction other than the State of New York to be applied. In furtherance of
the foregoing, the internal law of the State of New York will control the
interpretation and construction of this Agreement, even if under such
jurisdiction's choice of law or conflict of law analysis, the substantive law of
some other jurisdiction would ordinarily apply. The parties hereby irrevocably
submit to the jurisdiction of any New York State or Federal court sitting in the
State, City and County of New York in any action or proceeding arising out of or
relating to this Agreement, and the parties hereto irrevocably agree that all
claims with respect to such action or proceeding shall be heard and determined
in such a New York State or Federal court.
15. No amendment of any provision of this Agreement shall be valid unless
the same shall be in writing and signed by all of the parties. No waiver by any
party of any default, misrepresentation, or breach of covenant hereunder,
whether or not intentional, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of covenant hereunder or affect in any way
any rights arising by virtue of any prior or subsequent such occurrence.
16. The parties shall each have and retain all other rights and remedies
existing in their favor at law or equity, including, without limitation, any
actions for specific performance and/or injunctive or other equitable relief to
enforce or prevent any violations of the provisions of this Agreement.
17. It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is sought.
Accordingly, if any particular provision of this Agreement shall be adjudicated
by a court of competent jurisdiction to be invalid, prohibited or unenforceable
for any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so
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as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
* * * * *
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
Company:
NATIONAL NETWORK TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇'▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇'▇▇▇▇, ▇▇.
Title: President
Predecessor:
▇▇▇▇ ▇'▇▇▇▇ ELECTRIC CO., INC.
By: /s/ ▇▇▇▇ ▇. ▇'▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇'▇▇▇▇, ▇▇.
Title: President
By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇'▇▇▇▇
Title: President
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