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EXHIBIT 99.3
PARENT SUPPORT AGREEMENT
MEMORANDUM OF AGREEMENT made as of the 31st day of August, 1999.
BETWEEN:
BROADCOM (BVI) LIMITED, a company incorporated pursuant to the laws of
the British Virgin Islands, and having its registered office at Citco
Building, Wickhams Cay, P.O. Box 662, Road Town, Tortola, British Virgin
Islands.
(hereinafter referred to as "BVI"),
- and -
BROADCOM CORPORATION, a company incorporated pursuant to the laws of
California and having its offices at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇
(hereinafter referred to as "Parent"),
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HH ACQUISITION INC., a company incorporated pursuant to the laws of
British Columbia and having its registered office at 2600 - ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
(hereinafter referred to as "Acquisition Sub"),
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HH ACQUISITION ULC, a company incorporated pursuant to the laws of Nova
Scotia and having its registered office at 800 - 1959 ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
(hereinafter referred to as "CDN2").
WHEREAS pursuant to an acquisition agreement dated as of July 15, 1999
(the "Acquisition Agreement") by and between Parent, BVI, Acquisition Sub, CDN2
and HotHaus Technologies Inc. ("Target") the parties agreed that inter alia on
or before the Closing (as defined in the Acquisition Agreement), Parent, BVI,
CDN2 and Acquisition Sub would execute and deliver
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a Parent Support Agreement in substantially the form set forth in Exhibit D to
the Acquisition Agreement;
AND WHEREAS pursuant to an arrangement (the "Arrangement") to be
effected by plan of arrangement filed pursuant to the BC Company Act on the
Effective Date (as defined in the Acquisition Agreement) each issued and
outstanding common share of Target ("Target Common Shares") will be exchanged
with Acquisition Sub for, at the option of the Holder, Exchangeable Shares of
Acquisition Sub (the "Exchangeable Shares") or Parent Common Shares;
AND WHEREAS the plan of arrangement sets forth the special rights and
restrictions (collectively the "Exchangeable Share Provisions") attaching to the
Exchangeable Shares;
AND WHEREAS the parties hereto desire to make appropriate provision and
to establish a procedure whereby BVI or Parent as applicable, will take certain
actions and make certain payments and deliveries necessary to ensure that
Acquisition Sub will be able to make certain payments and to deliver or cause to
be delivered shares of Parent Common Shares in satisfaction of the obligations
of Acquisition Sub under the Exchangeable Share Provisions with respect to the
payment and satisfaction of dividends, Liquidation Amounts, Retraction Prices
and Redemption Prices all in accordance with the Exchangeable Share Provisions
and BVI or Parent as applicable, will take certain actions such that if CDN2
seeks to exercise its rights under the Plan of Arrangement, it will only do so
if it will be able to make certain payments and cause to be delivered Parent
Common Shares in satisfaction of the obligations of CDN2 under the Plan of
Arrangement;
NOW THEREFORE in consideration of the respective covenants in this
Agreement and for other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINED TERMS.
Each term denoted herein by initial capital letters and not otherwise
defined herein shall have the meaning ascribed thereto in the Exchangeable Share
Provisions, unless the context requires otherwise.
1.2 SECTIONS AND HEADINGS.
The division of this Agreement into articles, sections and paragraphs
and the insertion of headings are for reference purposes only and shall not
affect the interpretation of this Agreement. Unless otherwise indicated, any
reference in this Agreement to an article, section and paragraph refers to the
specified article, section or paragraph of this Agreement.
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1.3 NUMBER AND GENDER.
Words importing the singular number only shall include the plural and
vice versa. Words importing the use of any gender shall include all genders.
1.4 DATE FOR ANY ACTION.
If any date on which any action is required to be taken under this
agreement is not a Business Day, such action shall be required to be taken on
the next succeeding Business Day.
ARTICLE 2
COVENANTS OF PARENT, BVI AND ACQUISITION SUB
2.1 FUNDING OF THE ACQUISITION SUB.
So long as any Exchangeable Shares are outstanding:
(a) Parent shall not declare or pay any dividend on Parent Common
Shares unless (i) the Acquisition Sub shall have sufficient
assets, funds and other property (including, where applicable,
Parent Common Shares or other securities of Parent) available to
enable the due declaration and the due and punctual payment in
accordance with applicable law, of an equivalent dividend on the
Exchangeable Shares in accordance with the Exchangeable Share
Provisions and (ii) the Acquisition Sub shall simultaneously
declare or pay, as the case may be, an equivalent dividend on
the Exchangeable Shares in accordance with the Exchangeable
Share Provisions;
(b) BVI, or Parent in the event that BVI fails to perform, shall
cause the Acquisition Sub to declare simultaneously with the
declaration of any dividend on Parent Common Shares an
equivalent dividend on the Exchangeable Shares and, when such
dividend is paid on Parent Common Shares, cause the Acquisition
Sub to pay simultaneously therewith such equivalent dividend on
the Exchangeable Shares, in each case in accordance with the
Exchangeable Share Provisions;
(c) Parent shall advise the Acquisition Sub sufficiently in advance
of the declaration by Parent of any dividend on Parent Common
Shares and take all such other actions as are necessary, in
cooperation with the Acquisition Sub, to ensure that the
declaration date, record date and payment date for any dividend
on the Exchangeable Shares shall be the same as the record date,
declaration date and payment date for the corresponding dividend
on Parent Common Shares and such dates in respect of dividends
on the Exchangeable Shares shall be in accordance with any
requirement of the Exchangeable Share Provisions and the stock
exchange on which the Exchangeable Shares are listed;
(d) Parent shall ensure that the record date for any dividend
declared on Parent Common Shares, Parent Common Share
Reorganization or Capital Reorganization is not less than 10
Business Days after the declaration date for such dividend,
Parent Common Share Reorganization or Capital Reorganization;
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(e) BVI, or Parent in the event that BVI fails to perform, shall
take all such actions and do all such things as are necessary or
desirable to enable and permit Acquisition Sub, in accordance
with applicable law, to pay and otherwise perform its
obligations with respect to the satisfaction of the Liquidation
Amount in respect of each issued and outstanding Exchangeable
Share upon the liquidation, dissolution or winding-up of the
Acquisition Sub, including without limitation all such actions
and all such things as are necessary or desirable to enable and
permit the Acquisition Sub to cause to be delivered shares of
Parent Common Shares to the holders of Exchangeable Shares in
satisfaction of the Liquidation Amount for each such
Exchangeable Share, in accordance with the provisions of Article
4 of the Exchangeable Share Provisions;
(f) BVI, or Parent in the event that BVI fails to perform, shall
take all such actions and do such things as are necessary or
desirable to enable and permit the Acquisition Sub, in
accordance with applicable law, to pay and otherwise perform its
obligations with respect to the satisfaction of the Retraction
Price and the Redemption Price, including without limitation all
such actions and all such things as are necessary or desirable
to enable and permit the Acquisition Sub to cause to be
delivered shares of Parent Common Shares to the holders of
Exchangeable Shares, upon the retraction or redemption of the
Exchangeable Shares in accordance with the provisions of Article
5 or Article 6 of the Exchangeable Share Provisions, as the case
may be;
(g) BVI shall not, and in the event BVI fails to perform Parent
shall cause BVI not to, exercise its vote as a shareholder of
the Acquisition Sub to initiate, consent to or approve the
voluntary liquidation, dissolution or winding-up of the
Acquisition Sub nor take any action or omit to take any action
that is designed to result in the liquidation, dissolution or
winding-up of the Acquisition Sub;
(h) BVI shall not, and in the event BVI fails to perform Parent
shall cause BVI not to, exercise its vote as a shareholder of
the Acquisition Sub to authorize the continuance or other
transfer of the corporate existence of the Acquisition Sub to
any jurisdiction outside Canada; and
(i) Parent and BVI shall take all such actions and do such things as
are necessary or desirable to ensure that Acquisition Sub is
neither a specified financial institution (as that term is
defined in subsection 248(1) of the Income Tax Act (Canada) as
amended from time to time (the "Tax Act") nor a specified person
(as that term is defined in paragraph 112(2.2)(g) of the Tax
Act) in relation to any such institution.
2.2 SEGREGATION OF FUNDS.
BVI or Parent, in the event that BVI fails to perform, will cause the
Acquisition Sub to deposit a sufficient amount of funds in a separate account
and segregate a sufficient amount of such assets and other property as is
necessary to enable the Acquisition Sub to pay or otherwise satisfy the
applicable dividends, Liquidation Amount, Retraction Price or Redemption Price,
in each case for the benefit of holders from time to time of the Exchangeable
Shares, and will cause
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the Acquisition Sub to use such funds, assets and other property so segregated
exclusively for the payment of dividends and the payment or other satisfaction
of the Liquidation Amount, the Retraction Price or the Redemption Price, as
applicable, in each case in accordance with the Exchangeable Share Provisions.
2.3 RESERVATION OF PARENT COMMON SHARES.
Parent hereby represents and warrants that it has irrevocably reserved
for issuance out of its authorized and unissued capital stock such number of
Parent Common Shares as is equal to the number of Exchangeable Shares
outstanding immediately following the Effective Date and all vested and unvested
Replacement Options, as that term is defined in the Acquisition Agreement, which
are unexpired and unexercised, and covenants that at all times in the future
while any Exchangeable Shares or Replacement Options are outstanding it will
keep available, free from pre-emptive and other rights, out of its authorized
and unissued capital stock such number of Parent Common Shares (or other shares
or securities into which Parent Common Shares may be reclassified or changed) as
is necessary to enable, ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ and the Acquisition Sub to perform
their respective obligations pursuant to this agreement, the Exchangeable Share
Provisions and the Voting and Exchange Trust Agreement.
2.4 NOTIFICATION OF CERTAIN EVENTS.
In order to assist Parent, CDN2 and BVI to comply with its obligations
hereunder Acquisition Sub will give, or cause the Transfer Agent to give,
Parent, CDN2 and BVI notice of each of the following events at the time set
forth below:
(a) in the event of any determination by the Board of Directors of
the Acquisition Sub to institute voluntary liquidation,
dissolution or winding up proceedings with respect to the
Acquisition Sub or to effect any other distribution of the
assets of the Acquisition Sub among its shareholders for the
purpose of winding up its affairs, at least 60 days prior to the
proposed effective date of such liquidation, dissolution,
winding up or other distribution;
(b) on the earlier of (i) receipt by the Acquisition Sub of notice
of, and (ii) the Acquisition Sub otherwise becoming aware of,
any threatened or instituted claim, suit, petition or other
proceedings with respect to the involuntary liquidation,
dissolution or winding up of the Acquisition Sub or to effect
any other distribution of the assets of the Acquisition Sub
among its shareholders for the purpose of winding up its
affairs;
(c) immediately, upon receipt by the Transfer Agent of a Retraction
Request; and
(d) as soon as practicable upon the issuance by the Acquisition Sub
of any Exchangeable Shares or rights to acquire Exchangeable
Shares.
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2.5 DELIVERY OF PARENT COMMON SHARES.
In furtherance of the obligations of BVI or Parent as applicable, under
subsections 2.l (e) and (f) hereof, upon notice of any event that requires the
Acquisition Sub to cause to be delivered Parent Common Shares to any holder of
Exchangeable Shares, BVI or Parent, in the event that BVI fails to perform,
shall forthwith deliver the requisite Parent Common Shares to or to the order of
the former holder of the surrendered Exchangeable Shares, as the Acquisition Sub
shall direct. All such Parent Common Shares shall be duly issued as fully paid
and non-assessable and shall be free and clear of any Liens. In consideration of
the delivery of each such Parent Common Share by BVI or Parent as applicable,
the Acquisition Sub shall issue to BVI or Parent as applicable, or as BVI or
Parent as applicable, shall direct, such number of common shares of the
Acquisition Sub as is equal to the fair value of such Parent Common Shares.
2.6 QUALIFICATION OF PARENT COMMON SHARES.
The parties intend that the Exchangeable Shares issued pursuant to the
Plan of Arrangement and the shares of Parent Common Shares issued pursuant to
the Plan of Arrangement and shares of Parent Common Shares issuable in exchange
for the Exchangeable Shares will be issued in transactions (the "Contemplated
Issuances") exempt from registration under the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder ("Securities Act")
by reason of Section 3(a)(10) and/or 3(a)(9) thereof and, when issued, such
shares of Parent Common Shares will be immediately convertible into shares of
Parent Class A Common Stock which will be tradable by the holders without
restrictions except for the restrictions set out in the Company Affiliate
Agreements (as defined in the Acquisition Agreement) applicable to Company
Affiliates (as defined in the Acquisition Agreement). In the case of one or more
Contemplated Issuances not being exempt from registration under the Securities
Act, Parent agrees to take all steps reasonably necessary to permit such
Contemplated Issuances to proceed in accordance with the requirements of the
Securities Act and, in the case of shares of Parent Class A Common Stock not
being tradable without restriction, to take all steps reasonably necessary or
appropriate to cause such shares of Parent Class A Common Stock to be freely
tradable without restriction in such manner, including, but not limited to, (x)
within 14 days after the occurrence of a Triggering Event (as defined in the
Acquisition Agreement), filing with the Securities and Exchange Commission or
any successor entity ("SEC"), and using commercially reasonable efforts to cause
the effectiveness of, a registration statement under the Securities Act so as to
register the issuance of such shares of Parent Class A Common Stock, (y) using
commercially reasonable efforts to maintain the effectiveness of such
registration statement (the "Public Registration") until all such shares of
Parent Class A Common Stock have been issued by Parent and (z) taking any action
required to be taken under applicable SEC, state and provincial securities laws
and the regulations of NASDAQ in connection with the issuance of such shares of
Parent Class A Common Stock. Notwithstanding any provision hereof to the
contrary, Parent shall be entitled, without prior notice, to suspend the Public
Registration during customary "blackout periods" relating to material non-public
information regarding Parent that causes the prospectus contained in such
registration statement to not be complete or correct in any material respect.
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2.7 ECONOMIC EQUIVALENCE.
(a) Parent will not without prior approval of Acquisition Sub and
the prior approval of the holders of the Exchangeable Shares
given in accordance with Section 8.2 of the Exchangeable Shares
Provisions:
(i) issue or distribute Parent Common Shares (or securities
exchangeable for or convertible into or carrying rights
to acquire Parent Common Shares) to the holders of all
or substantially all of the then outstanding Parent
Common Shares by way of stock dividend or other
distribution, other than an issue of Parent Common
shares (or securities exchangeable for or convertible
into or carrying rights to acquire Parent Common Shares)
to holders of Parent Common Shares who exercise an
option to receive dividends in Parent Common Shares (or
securities exchangeable for or convertible into or
carrying rights to acquire Parent Common Shares) in lieu
of receiving cash dividends; or
(ii) issue or distribute rights, options or warrants to the
holders of all or substantially all of the then
outstanding Parent Common Shares entitling them to
subscribe for or to purchase Parent Common Shares (or
securities exchangeable for or convertible into or
carrying rights to acquire Parent Common Shares); or
(iii) issue or distribute to the holders of all or
substantially all of the then outstanding Parent Common
Shares (A) shares or securities of Parent of any class
other than Parent Common Shares (other than shares
convertible into or exchangeable for or carrying rights
to acquire Parent Common Shares), (B) rights, options or
warrants other than those referred to in clause (ii),
(C) evidence of indebtedness of Parent or (D) assets of
Parent,
unless the economic equivalent on a per share basis of such
rights, options, securities, shares, evidences of indebtedness
or other assets is issued or distributed simultaneously to
holders of the Exchangeable Shares; provided that, for greater
certainty, the above restrictions shall not apply to any
securities issued or distributed by Parent in order to give
effect to and to consummate the transactions contemplated by,
and in accordance with, the Plan of Arrangement.
(b) Parent will not without the prior approval of Acquisition Sub
and the prior approval of the holders of the Exchangeable Shares
given in accordance with Section 8.2 of the Exchangeable Shares
Provisions;
(i) subdivide, redivide or change the then outstanding
Parent Common Shares into a greater number of Parent
Common Shares; or
(ii) reduce, combine, consolidate or change the then
outstanding Parent Common Shares into a lesser number of
Parent Common Shares; or
(iii) reclassify or otherwise change Parent Common Shares or
effect an amalgamation, merger, reorganization or other
transaction affecting Parent Common Shares,
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unless the same or an economically equivalent change shall
simultaneously be made to, or in the rights of the holders of,
the Exchangeable Shares.
(c) Parent will ensure that the record date for any event referred
to in subsection 2.7(a) or 2.7(b), or (if no record date is
applicable for such event) the effective date for any such
event, is not less than 10 days after the date on which such
event is declared or announced by Parent (with contemporaneous
notification thereof by Parent to Acquisition Sub).
(d) The Board of Directors of Acquisition Sub shall determine, in
good faith and in its sole discretion (with the assistance of
such reputable and qualified independent financial advisors
and/or other experts as the Board of Directors of Acquisition
Sub may require), economic equivalence for the purposes of any
event referred to in subsection 2.7(a) or 2.7(b) and each such
determination shall be conclusive and binding on Parent. In
making each such determination, the following factors shall,
without excluding other factors determined by the Board of
Directors of Acquisition Sub to be relevant, be considered by
the Board of Directors of Acquisition Sub:
(i) in the case of any stock dividend or other distribution
payable in Parent Common Shares, the number of such
shares issued in proportion to the number of Parent
Common Shares previously outstanding;
(ii) in the case of the issuance or distribution of any
rights, options or warrants to subscribe for or purchase
Parent Common Shares (or securities exchangeable for or
convertible into or carrying rights to acquire Parent
Common Shares), the relationship between the exercise
price of each such right, option or warrant and the
current market value (as determined by the Board of
Directors of Acquisition Sub in the manner above
contemplated) of a Parent Common Share;
(iii) in the case of the issuance or distribution of any other
form of property (including without limitation any
shares or securities of Parent of any class other than
Parent Common Shares, any rights, options or warrants
other than those referred to in clause (d)(ii), any
evidence of indebtedness of Parent or any assets of
Parent), the relationship between the fair market value
(as determined by the Board of Directors of Acquisition
Sub in the manner above contemplated) of such property
to be issued or distributed with respect to each
outstanding Parent Common Share and the current market
value (as determined by the Board of Directors of
Acquisition Sub in the manner above contemplated) of a
Parent Common Share;
(iv) in the case of any subdivision, redivision or change of
the then outstanding Parent Common Shares into a greater
number of parent Common Shares or the reduction,
combination, consolidation or change of the then
outstanding Parent Common Shares into a lesser number of
Parent Common Shares or any amalgamation, merger,
reorganization or other transaction affecting
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▇▇▇▇▇▇ ▇▇▇▇▇▇ Shares, the effect thereof upon the then
outstanding Parent Common Shares; and
(v) in all such cases, the general taxation consequences of
the relevant event to holders of Exchangeable Shares to
the extent that such consequences may differ from the
taxation consequences to holders of Parent Common Shares
as a result of differences between taxation laws of
Canada and the United States (except for any differing
consequences arising as a result of differing marginal
taxation rates and without regard to the individual
circumstances of holders of Exchangeable Shares).
For purposes of the foregoing determinations, the current market
value of any security listed and traded or quoted on a
securities exchange shall be the weighted average of the daily
trading prices of such security during a period of not less than
30 consecutive trading days ending not more than five trading
days before the date of determination on the principal
securities exchange on which such securities are listed and
traded or quoted; provided, however, that if in the opinion of
the Board of Directors of Acquisition Sub the public
distribution or trading activity of such securities during such
period does not create a market which reflects the fair market
value of such securities, then the current market value thereof
shall be determined by the Board of Directors of Acquisition
Sub, in good faith and in its sole discretion (with the
assistance of such reputable and qualified independent financial
advisors and/or other experts as the Board of Directors of
Acquisition Sub may require), and provided further that any such
determination by the Board of Directors of Acquisition Sub shall
be conclusive and binding on Parent.
(e) Acquisition Sub agrees that, to the extent required, upon due
notice from Parent, it will use its best efforts to take or
cause to be taken such steps as may be necessary for the
purposes of ensuring that appropriate dividends are paid or
other distributions are made by Acquisition Sub, or
subdivisions, redivisons or changes are made to the Exchangeable
Shares, in order to implement the required economic equivalent
with respect to the Parent Common Shares and Exchangeable Shares
as provided for in this section 2.6.
2.8 TENDER OFFERS, ETC.
In the event that a tender offer, share exchange offer, issuer bid,
take-over bid or similar transaction with respect to Parent Common Shares (an
"Offer") is proposed by Parent or is proposed to Parent or its stockholders and
is recommended by the Board of Directors of Parent, or is otherwise effected or
to be effected with the consent or approval of the Board of Directors of Parent,
Parent will use all commercially reasonable efforts expeditiously and in good
faith to take all such actions and do all such things as are necessary or
desirable to enable and permit holders of Exchangeable Shares to participate in
such Offer to the same extent and on an economically equivalent basis as the
holders of Parent Common Shares, without discrimination. Without limiting the
generality of the foregoing, Parent will use all commercially reasonable efforts
expeditiously and in good faith to ensure that holders of Exchangeable Shares
may participate in all such Offers without being required to retract
Exchangeable Shares as against the Acquisition Sub (or, if so
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required, to ensure that any such retraction shall be effective only upon, and
shall be conditional upon, the closing of the Offer and only to the extent
necessary to tender or deposit to the Offer).
2.9 OWNERSHIP OF OUTSTANDING SHARES.
Parent covenants and agrees in favour of the Acquisition Sub that, as
long as any outstanding Exchangeable Shares are owned by any person or entity
other than Parent or any of its Affiliates, Parent will be and remain the direct
or indirect beneficial owner of all issued and outstanding shares in the capital
of the Acquisition Sub (other than Exchangeable Shares) and all outstanding
securities of the Acquisition Sub carrying or otherwise entitled to voting
rights in any circumstances (other than Exchangeable Shares) unless Parent shall
have obtained the prior approval of the Acquisition Sub and the holders of the
Exchangeable Shares given in accordance with section 8.2 of the Exchangeable
Share Provisions.
2.10 PARENT AND AFFILIATES NOT TO VOTE EXCHANGEABLE SHARES.
Each of Parent and CDN2 covenants and agrees that they will appoint and
cause to be appointed proxyholders with respect to all Exchangeable Shares held
by them and their Affiliates for the sole purpose of attending each meeting of
holders of Exchangeable Shares in order to be counted as part of the quorum for
each such meeting. Each of Parent and CDN2 further covenants and agrees that
they will not, and will cause their Affiliates not to, exercise any voting
rights that may be exercisable by holders of Exchangeable Shares from time to
time pursuant to the Exchangeable Share Provisions or pursuant to the provisions
of the BC Company Act with respect to any Exchangeable Shares held by them or by
their Affiliates in respect of any matter considered at any meeting of holders
of Exchangeable Shares, including without limitation any approval to be given by
holders of Exchangeable Shares pursuant to section 8.2 of the Exchangeable Share
Provisions.
2.11 DUE PERFORMANCE.
On and after the Effective Date, Parent and CDN2 shall duly and timely
perform all of their obligations provided for in the Plan of Arrangement,
including any obligations that may arise upon the exercise of Parent's and
CDN2's rights under the Exchangeable Share Provisions.
2.12 ECONOMIC EQUIVALENCE.
Parent hereby acknowledges that it will be bound by any determination of
economic equivalence made by the Board of Directors pursuant to section 5.5 of
the Plan of Arrangement or section 9.1 of the Exchangeable Share Provisions,
where applicable.
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ARTICLE 3
GENERAL
3.1 TERM.
This agreement shall come into force and be effective as of the date
hereof and shall terminate and be of no further force and effect at such time as
there are no Exchangeable Shares (or securities or rights convertible into or
exchangeable for or carrying rights to acquire Exchangeable Shares) held by any
party, other than Parent and its Affiliates.
3.2 CHANGES IN CAPITAL OF PARENT AND THE ACQUISITION SUB.
Notwithstanding the provisions of section 3.4 hereof, at all times after
the occurrence of any event effected pursuant to section 2.7 or 2.8 hereof as a
result of which either Parent Common Shares or the Exchangeable Shares or both
are in any way changed, this agreement shall forthwith be amended and modified
as necessary in order that it shall apply with full force and effect, mutatis
mutandis, to all new securities into which Parent Common Shares or the
Exchangeable Shares or both are so changed and the parties hereto shall execute
and deliver an agreement in writing giving effect to and evidencing such
necessary amendments and modifications.
3.3 SEVERABILITY.
If any provision of this agreement is held to be invalid, illegal or
unenforceable, the validity, legality or enforceability of the remainder of this
agreement shall not in any way be affected or impaired thereby and this
agreement shall be carried out as nearly as possible in accordance with its
original terms and conditions.
3.4 AMENDMENTS, MODIFICATIONS, ETC.
This agreement may not be amended or modified except by an agreement in
writing executed by Acquisition Sub, CDN2, BVI and Parent and approved by the
holders of the Exchangeable Shares in accordance with section 8.2 of the
Exchangeable Share Provisions.
3.5 MINISTERIAL AMENDMENTS.
Notwithstanding the provisions of section 3.4, the parties to this
agreement may without the approval of the holders of the Exchangeable Shares, at
any time and from time to time, amend or modify this agreement in writing for
the purposes of:
(a) adding to the covenants of either or both parties for the
protection of the holders of the Exchangeable Shares;
(b) making such amendments or modifications not inconsistent with
this agreement as may be necessary or desirable with respect to
matters or questions which, in the opinion of the board of
directors of each of ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇, ▇▇▇▇ and Parent, it
may be expedient to make, provided that each such board of
directors shall be of the opinion that such amendments or
modifications will not be prejudicial to the interests of the
holders of the Exchangeable Shares; or
(c) making such changes or corrections which, on the advice of
counsel to ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇, ▇▇▇▇ and Parent, are required
for the purpose of curing or correcting any ambiguity or defect
or inconsistent provision or clerical omission or mistake or
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manifest error herein, provided that the boards of directors of
each of ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇, ▇▇▇▇ and Parent shall be of the
opinion that such changes or corrections will not be prejudicial
to the interests of the holders of the Exchangeable Shares.
3.6 MEETING TO CONSIDER AMENDMENTS.
Acquisition Sub, at the request of CDN2, BVI or Parent, shall call a
meeting or meetings of the holders of the Exchangeable Shares for the purpose of
considering any proposed amendment or modification requiring approval pursuant
to section 3.4 hereof. Any such meeting or meetings shall be called and held in
accordance with the articles of the Acquisition Sub and the Exchangeable Share
Provisions.
3.7 WAIVERS ONLY IN WRITING.
No waiver of any of the provisions of this agreement otherwise permitted
hereunder shall be effective unless made in writing and signed by both of the
parties hereto.
3.8 ENUREMENT.
This agreement shall be binding upon and enure to the benefit of the
parties hereto and their respective successors and Permitted Assigns.
3.9 PARENT SUCCESSORS.
Parent shall not enter into any transaction (whether by way of
reconstruction, reorganization, consolidation, merger, transfer. sale, lease or
otherwise) whereby all or substantially all its undertaking, property and assets
would become the property of any other person or, in the case of a merger, of
the continuing company resulting therefrom, unless:
(a) such other person or continuing company is a company (the
"Parent Successor") incorporated under the laws of any state of
the United States or the laws of Canada or any province thereof;
and
(b) the Parent Successor, by operation of law, becomes, without
more, bound by the terms and provisions of this agreement or, if
not so bound, executes, prior to or contemporaneously with the
consummation of such transaction, an agreement to be bound by
the provisions hereof as if it were an original party hereto and
to observe and perform all of the covenants and obligations of
Parent pursuant to this agreement, in form satisfactory to the
Acquisition Sub, acting reasonably.
Nothing herein shall be construed as preventing the amalgamation or merger of
any wholly-owned subsidiary of Parent with or into Parent, provided that such
transaction complies with this section 3.9.
3.10 NOTICES TO PARTIES.
All notices, requests and other communications between the parties
hereunder shall be in writing and shall be deemed to have been given only if
delivered personally against written
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receipt or by facsimile transmission against facsimile confirmation or mailed by
registered mail, return receipt requested or mailed by overnight courier
prepaid, to the parties at the following addresses or facsimile numbers (or at
such other address for either such party as shall be specified in like notice):
(a) if to ▇▇▇▇▇▇, ▇▇▇, ▇▇▇▇ or Acquisition Sub at:
Broadcom Corporation
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President and Chief Executive Officer General Counsel
and General Counsel
with a copy to:
▇▇▇▇▇▇▇, Phlegert & ▇▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, ESQ
Farris, Vaughan, ▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ - ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: R. ▇▇▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇
All such notices, requests and other communications shall (i) if
delivered personally to the address as provided in this Section, be deemed given
upon delivery, (ii) if delivered by facsimile transmission to the facsimile
number as provided for in this Section, be deemed given upon facsimile
confirmation, (iii) if delivered by mail in the manner described above to the
address as provided for in this Section, be deemed given on the earlier of the
third Business Day following mailing or upon receipt and (iv) if delivered by
overnight courier to the address as provided in this Section, be deemed given on
the earlier of the first Business Day following the date sent by such overnight
courier or upon receipt (in each case regardless of whether such notice, request
or other communication is received by any other Person to whom a copy of such
notice is to be delivered pursuant to this Section). Any party from time to time
may change its address, facsimile number or other information for the purpose of
notices to that party by giving notice specifying such change to the other party
hereto.
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3.11 COUNTERPARTS.
This agreement may be executed in counterparts, each of which shall be
deemed an original, and all of which taken together shall constitute one and the
same instrument.
3.12 JURISDICTION.
This agreement shall be construed and enforced in accordance with the
laws of the State of California.
3.13 ATTORNMENT.
Each of Parent, BVI, Acquisition Sub and CND2 agree that any action or
proceeding arising out of or relating to this agreement may be instituted in the
courts of the State of California waives any objection which it may have now or
hereafter to the venue of any such action or proceeding, irrevocably submits to
the jurisdiction of the said courts in any such action or proceeding, agrees to
be bound by any judgment of the said courts and not to seek, and hereby waives,
any review of the merits of any such judgment by the courts of any other
jurisdiction and hereby appoints the Acquisition Sub at its registered office as
Parent's, BVI's and CDN2's attorney for service of process.
ARTICLE 4
GUARANTY AND ASSIGNMENT
4.1 GUARANTY AND ASSIGNMENT
BVI, or Parent in the event BVI fails to perform, hereby unconditionally
and irrevocably guarantees the full and punctual performance of all CDN2's
obligations hereunder. CDN2 may assign all or a portion of its rights and
obligations hereunder to Parent or to BVI (collectively the "Permitted Assigns"
and either individually a "Permitted Assign") without the consent of Acquisition
Sub whereupon Acquisition Sub, BVI or Parent shall enter into a supplemental
agreement reflecting such assignment, provided that CDN2 shall not thereby be
released from such obligations.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
duly executed as of the date first above written.
BROADCOM CORPORATION
by _____________________________
_____________________________
BROADCOM (BVI) LIMITED
by _____________________________
_____________________________
HH ACQUISITION INC.
by _____________________________
_____________________________
HH ACQUISITION ULC
by _____________________________
_____________________________
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