AGREEMENT AND PLAN OF REORGANIZATION
BETWEEN
ACCESS BEYOND, INC.
AND
▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
July 29, 1997
TABLE OF CONTENTS
Page
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I. PLAN OF REORGANIZATION ................................................2
1.1 The Merger.......................................................2
1.2 Fractional Shares................................................3
1.3 ▇▇▇▇▇ Options and Warrants.......................................4
1.4 Effects of the Merger............................................4
1.5 Tax-Free Reorganization..........................................6
1.6 Purchase Accounting Treatment....................................6
1.7 Charter Amendments ..............................................6
2. REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇................................6
2.1 Organization and Good Standing...................................6
2.2 Subsidiaries.....................................................7
2.3 Power, Authorization and Validity................................7
2.4 Capitalization...................................................8
2.5 No Conflict or Violation.........................................9
2.6 Litigation.......................................................9
2.7 ▇▇▇▇▇ Financial Statements.......................................9
2.8 Taxes...........................................................10
2.9 Title to Properties.............................................10
2.10 Absence of Certain Changes......................................11
2.11 Agreements and Commitments......................................12
2.12 Intellectual Property...........................................13
2.13 Compliance with Laws............................................14
2.14 Certain Transactions and Agreements.............................14
2.15 Employees.......................................................15
2.16 Corporate Documents.............................................16
2.17 Books and Records...............................................17
2.18 Insurance.......................................................17
2.19 Environmental Matters ..........................................17
2.20 Government Contracts............................................17
2.21 No Brokers......................................................18
2.22 Information Supplied............................................18
2.23 Interested Party Transactions...................................18
2.24 Real Property Holding Corporation Status .......................19
2.25 Disclosure......................................................19
3. REPRESENTATIONS AND WARRANTIES OF ACCESS BEYOND.......................19
3.1 Organization and Good Standing..................................19
3.2 Subsidiaries....................................................19
3.3 Power, Authorization and Validity...............................20
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3.4 Capitalization..................................................20
3.5 No Conflict or Violation........................................21
3.6 Litigation......................................................21
3.7 Access Beyond Financial Statements..............................22
3.8 Taxes...........................................................22
3.9 Title to Properties.............................................23
3.10 Absence of Certain Changes......................................23
3.11 Agreements and Commitments......................................25
3.12 Intellectual Property...........................................26
3.13 Compliance with Laws............................................27
3.14 Certain Transactions and Agreements.............................27
3.15 Employees.......................................................27
3.16 Corporate Documents.............................................28
3.17 Books and Records...............................................29
3.18 Insurance.......................................................29
3.19 Environmental Matters...........................................29
3.20 Government Contracts............................................29
3.21 Remote Access Products .........................................31
3.22 No Brokers......................................................31
3.23 Information Supplied............................................31
3.24 Interested Party Transactions...................................31
3.25 Disclosure......................................................31
3.26 SEC Filings ....................................................32
4. COVENANTS OF THE PARTIES..............................................32
4.1 Access; Advice of Changes.......................................32
4.2 Notification of Changes in Relationships........................33
4.3 Conduct of Business.............................................33
4.4 No Solicitation.................................................35
4.5 Registration on Form S-4........................................36
4.6 Regulatory Approvals............................................37
4.7 Stockholders Meetings...........................................38
4.8 Indemnification of Officers and Directors.......................39
4.9 Confidentiality.................................................40
4.10 Confidentiality and Disclosure..................................40
4.11 Affiliates Agreements...........................................40
4.12 New Capital Funding ............................................41
4.13 Other Actions Required..........................................41
5.41 ▇▇▇▇▇ PRECLOSING COVENANTS............................................41
5.1 Business Plan...................................................41
5.2 ▇▇▇▇▇ Dissenting Shares.........................................42
5.3 Other Actions Required .........................................42
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6. CLOSING MATTERS.......................................................42
6.1 The Closing.....................................................42
6.2 Exchange of Certificates........................................43
6.3 Assumption of Options and Warrants..............................43
6.4 Access Beyond Options ..........................................44
7. CONDITIONS TO OBLIGATIONS OF ▇▇▇▇▇....................................44
7.1 Removal of Due Diligence and Other Conditions ..................44
7.2 Covenants, Representations and Warranties.......................44
7.3 Compliance with Law.............................................45
7.4 Government Consents.............................................45
7.5 Form S-4........................................................45
7.6 Documents and Consents..........................................45
7.7 ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇ Compliance....................................45
7.8 No Litigation...................................................45
7.9 Opinion of Counsel..............................................45
7.10 Employment Agreements...........................................46
7.11 Tax-Free Transaction ...........................................46
7.12 Listing.........................................................46
7.13 Access Beyond Amended and Restated Certificate..................46
7.14 Satisfactory Form of Legal and Accounting Matters...............46
7.15 Access Beyond Board of Directors................................46
7.16 Resignations ...................................................46
7.17 Shareholders Agreement .........................................46
8. CONDITIONS TO OBLIGATIONS OF ACCESS BEYOND............................47
8.1 Removal of Due Diligence and Other Conditions...................47
8.2 Covenants, Representations and Warranties.......................47
8.3 Compliance with Law.............................................47
8.4 Government Consents.............................................47
8.5 Form S-4........................................................48
8.6 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Compliance....................................48
8.7 Documents and Consents..........................................48
8.8 No Litigation...................................................48
8.9 Opinion of Counsel..............................................48
8.10 Employment Agreements...........................................48
8.11 Listing.........................................................48
8.12 Affiliate Agreements............................................48
8.13 Satisfactory Form of Legal and Accounting Matters...............49
8.14 Completion of other Actions.....................................49
8.15 Access Beyond Restated Certificate..............................49
8.16 Fairness Opinion................................................49
8.17 Access Beyond Board of Directors................................49
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9. TERMINATION OF AGREEMENT..............................................49
9.1 Termination.....................................................49
9.2 Effect of Termination...........................................51
9.3 Expenses; Termination Fees......................................52
10. SURVIVAL OF REPRESENTATIONS, CONTINUING COVENANTS......................53
11. GENERAL PROVISIONS....................................................53
11.1 Governing Law; Dispute Resolution...............................53
11.2 Assignment; Binding Upon Successors and Assigns.................54
11.3 Severability....................................................54
11.4 Counterparts....................................................55
11.5 Other Remedies..................................................55
11.6 Amendment and Waivers...........................................55
11.7 No Waiver.......................................................55
11.8 Notices.........................................................55
11.9 Construction of Agreement.......................................57
11.10 No Joint Venture................................................57
11.11 Further Assurances..............................................57
11.12 Absence of Third Party Beneficiary Rights.......................57
11.13 Time is of the Essence..........................................57
11.14 Entire Agreement................................................57
Exhibits:
Exhibit A Form of Certificate of Merger
Exhibit C-1 Form of Voting Agreement
Exhibit C-2 Form of Market Standoff Agreement
Exhibit C-3 Form of ▇▇▇▇▇ Affiliates Agreement
Exhibit C-4 Form of Employment Agreement for ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Exhibit C-5 Form of Employment Agreement for ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Exhibit 1.5A Certificate of Officer as to Tax Matters
(Access Beyond and Newco)
Exhibit 1.5B Certificate of Officer as to Tax Matters (▇▇▇▇▇)
Exhibit 7.13 Form of Restated Certificate
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AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (this "Agreement") is entered
into as of July 29, 1997, by and between Access Beyond, Inc., a Delaware
corporation ("Access Beyond"), and ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia
corporation ("▇▇▇▇▇") (and individually referred to as "Party" and jointly and
severally referred to herein as "Parties").
A. The Parties intend that, subject to the terms and conditions set forth
herein, a new corporation that will be organized in Georgia as a wholly owned
subsidiary of Access Beyond ("Newco") will merge with and into ▇▇▇▇▇ in a
reverse triangular merger (the "Merger"), with ▇▇▇▇▇ to be the surviving
corporation of the Merger, all pursuant to the terms and conditions of this
Agreement and Certificate of Merger substantially in the form of Exhibit A (the
"Certificate of Merger") and the applicable provisions of the laws of Georgia.
B. Upon the effectiveness of the Merger, all the outstanding capital stock
of ▇▇▇▇▇ will be converted into capital stock of Access Beyond, and Access
Beyond will assume all outstanding options and warrants to purchase shares of
▇▇▇▇▇ capital stock, in the manner and on the basis determined herein and as
provided in the Certificate of Merger.
C. The Merger is intended to be treated as a "purchase" for accounting
purposes and a tax-free reorganization pursuant to the provisions of Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the "Code"), by
virtue of the provisions of Section 368(a)(2)(E) of the Code.
D. Concurrent with the execution and delivery of this Agreement:
(i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chestnut Capital, LLC, Rinzai Limited and
Vulcan Ventures Incorporated, who together hold a majority or more of the issued
and outstanding shares of each class or series of ▇▇▇▇▇ capital stock, and a
sufficient number of shares of ▇▇▇▇▇ capital stock to approve the Merger (the
"Principal ▇▇▇▇▇ Shareholders"), are each executing and delivering to Access
Beyond a fully signed copy of a certain Voting Agreement substantially in the
form of Exhibit C-1 containing a market standoff agreement, an agreement to vote
in favor of the Merger, this Agreement, the Certificate of Merger and the
transactions provided for herein and against any transaction that could
adversely affect the Merger (collectively, the "Voting Agreements");
(ii) certain other shareholders of ▇▇▇▇▇ are entering into a "Market
Standoff Agreement" in substantially the form attached hereto as Exhibit C-2;
(iii) the Principal ▇▇▇▇▇ Shareholders and any other shareholder of
▇▇▇▇▇ who is an "affiliate" of ▇▇▇▇▇ within the meaning of Rule 145 promulgated
by the Securities and Exchange Commission under the Securities Act of 1933, as
amended, and the key corporate officers and directors of ▇▇▇▇▇ by the end of the
Due Diligence Period will be entering into the "▇▇▇▇▇ Affiliates Agreements"
substantially in the form of Exhibit C-3 hereto;
(iv) the shareholders of ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ are entering
into a Shareholders' Agreement to be effective at the Effective Time (the
"Shareholders' Agreement"); and
(v) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ are entering into an
Employment Agreement or an amendment to Employment Agreement with Access Beyond
substantially in the form of Exhibits C-4 and C-5 hereto, respectively (the
"Employment Agreements").
The Parties acknowledge that in the event that the transactions
contemplated by this Agreement are not consummated, each Party would experience
a substantial loss and hardship; therefore, to minimize the potential for such
(i) failure to consummate the transactions and (ii) loss and hardship, the
Parties have knowingly agreed not to include in this Agreement many otherwise
normal conditions to closing the Merger, including but not limited to, a
condition that there shall be no material adverse change prior to the Effective
Time (as defined below) to either Party, its business, financial condition,
results of operations or prospects, or to either Party's industry or to general
business conditions.
Now, therefore, in reliance upon the recitals set forth above, the Parties
hereto agree as follows:
I. PLAN OF REORGANIZATION.
1.1 The Merger. Subject to the terms and conditions of this
Agreement, prior to the Closing Date (as defined in Section 6.1 below), Access
Beyond will incorporate and organize Newco and will cause the Board of Directors
and shareholders of Newco to approve the Merger and become a party to this
Agreement which is obligated to perform all of the duties of Newco set forth in
this Agreement. Subject to the terms and conditions of this Agreement, the
Certificate of Merger will be filed with the Secretary of State of the State of
Georgia on the Closing Date. The date and time that the Certificate of Merger is
filed with the Georgia Secretary of State and the Merger thereby becomes
effective will be referred to in this Agreement as the "Effective Time." Subject
to the terms and conditions of this Agreement and the Certificate of Merger,
Newco will be merged with and into ▇▇▇▇▇ in a statutory merger pursuant to the
Certificate of Merger and in accordance with applicable provisions of Georgia
law as follows.
1.1.1 Creation of Series A Stock. Prior to the Effective Time,
Access Beyond will have amended its Certificate of Incorporation to create the
Series A Preferred Stock of Access Beyond (the "Access Beyond Series A Stock"),
each share of which shall initially be convertible into one share of Access
Beyond Common Stock, $0.01 par value ("Access Beyond Common Stock") and shall
have the rights, preferences, privileges and restrictions as are specified in
the form of Restated Certificate of Incorporation attached hereto as Exhibit
7.13.
1.1.2 Conversion of ▇▇▇▇▇ Common Stock. Each share of ▇▇▇▇▇
Common Stock, $0.01 par value (the "▇▇▇▇▇ Common Stock") that is issued and
outstanding immediately
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prior to the Effective Time (other than shares, if any, for which dissenters
rights are perfected in compliance with applicable law), will, by virtue of the
Merger and at the Effective Time and without further action on the part of any
holder thereof, be converted into the right to receive that number of fully paid
and nonassessable shares of Access Beyond Common Stock, that is equal to the
Conversion Ratio.
1.1.3 Conversion of ▇▇▇▇▇ Series A Stock. Each share of ▇▇▇▇▇
Series A Preferred Stock, no par value (the "▇▇▇▇▇ Series A Stock"), that is
issued and outstanding immediately prior to the Effective Time (other than
shares, if any, for which dissenters rights are perfected in compliance with
applicable law), will, by virtue of the Merger and at the Effective Time and
without further action on the part of any holder thereof, be converted into the
right to receive that number of fully paid and nonassessable shares of Access
Beyond Common Stock that is equal to the Conversion Ratio multiplied by the
number of shares of ▇▇▇▇▇ Common Stock into which such share of ▇▇▇▇▇ Series A
Stock is then convertible.
1.1.4 Conversion of ▇▇▇▇▇ Series B Stock. Each share of ▇▇▇▇▇
Series B Preferred Stock, no par value (the "▇▇▇▇▇ Series B Stock"), that is
issued and outstanding immediately prior to the Effective Time (other than
shares, if any, for which dissenters rights are perfected in compliance with
applicable law), will, by virtue of the Merger and at the Effective Time and
without further action on the part of any holder thereof, be converted into the
right to receive that number of fully paid and nonassessable shares of Access
Beyond Series A Stock that is equal to the Conversion Ratio multiplied by the
number of shares of ▇▇▇▇▇ Common Stock into which such share of ▇▇▇▇▇ Series B
Stock is then convertible.
1.1.5 Conversion Ratio Defined. For purposes of this
Agreement, the "Conversion Ratio" shall be determined as follows,
First, take the percentage ownership immediately after Closing of the issued and
outstanding shares of Access Beyond Common Stock and Access Beyond Series A
Stock that the holders of all classes of ▇▇▇▇▇ Common, Series A Preferred Stock
and Series B Preferred Stock in the aggregate are entitled to receive as a
result of and immediately following the Merger, which the Parties hereby agree
is seventy-nine percent (79%) (the "▇▇▇▇▇ Percentage").
Next, calculate the "Conversion Ratio" according to the following formula:
Conversion Ratio = [ B ( {C} OVER {1.0 - B} ) ] / D
Where: B = .79 (the "▇▇▇▇▇ Percentage")
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C = The number of shares of Access Beyond common and preferred
stock issued and outstanding on a fully diluted basis
(excluding all issued and outstanding Access Beyond stock
options) immediately prior to the Effective Time
D = The number of shares of ▇▇▇▇▇ common and preferred stock
issued and outstanding on a fully diluted basis immediately
prior to the Effective Time, excluding all issued and
outstanding ▇▇▇▇▇ stock options and warrants in accordance
with Sections 2.4.2 and 5.4 hereof
Thus, for example only, assuming that the number of fully diluted shares of
Access Beyond common and preferred stock (excluding shares issuable upon
exercise of Access Beyond stock options) outstanding immediately prior to the
Effective Time, or "C," equals 12,500,000 and that the number of fully diluted
shares of ▇▇▇▇▇ common and preferred stock outstanding (excluding shares
issuable upon exercise of ▇▇▇▇▇ stock options and warrants) immediately prior to
the Effective Time, or "D," equals 10,000,000, then the Conversion Ratio would
be 4.702381.
1.1.6 Dissenting Shares. Holders of ▇▇▇▇▇ Common Stock, ▇▇▇▇▇
Series A Stock and/or ▇▇▇▇▇ Series B Stock (the "▇▇▇▇▇ Stock") who have complied
with all requirements for perfecting shareholders' rights of appraisal, if any,
as set forth in Section 14-2-1301 et seq. of the Georgia Business Corporation
Code ("Georgia Law"), shall be entitled to their rights under the Georgia Law,
if any, with respect to such shares ("Dissenting Shares") and not to any portion
of the Access Beyond Common Stock or Access Beyond Series A Stock receivable by
the shareholders of ▇▇▇▇▇ by reason of the Merger.
1.1.7 Conversion of Newco Shares. Each share of Newco Common
Stock, par value $0.01 ("Newco Common Stock"), that is issued and outstanding
immediately prior to the Effective Time will, by virtue of the Merger and
without further action on the part of the sole shareholder of Newco, be
converted into and become one share of ▇▇▇▇▇ Common Stock that is to be issued
and outstanding immediately after the Effective Time, and the share of ▇▇▇▇▇
Common Stock into which the shares of Newco Common Stock are so converted shall
be the only share of ▇▇▇▇▇ Stock that is issued and outstanding immediately
after the Effective Time.
1.2 Fractional Shares. No fractional shares of Access Beyond Common
Stock or Access Beyond Series A Stock (the "Access Beyond Stock") will be issued
in connection with the Merger, but in lieu thereof, the record holder of any
shares of ▇▇▇▇▇ Stock who would otherwise be entitled to receive a fraction of a
share of Access Beyond Stock, upon aggregation of all shares and fractional
shares owned by such holder, will receive from Access Beyond, promptly after the
Effective Time, without interest, an amount of cash equal to the per share
market value of Access Beyond Stock (based on the closing sale price of Access
Beyond Common Stock on the last trading day prior to the Closing Date, as quoted
on the Nasdaq National Market and reported in the Western Edition of The Wall
Street Journal) multiplied by the fraction of a share of Access Beyond Stock to
which such holder would otherwise be entitled.
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1.3 ▇▇▇▇▇ Options and Warrants.
1.3.1 Assumption of Options and Warrants. At the Effective
Time, each outstanding option (collectively, the "▇▇▇▇▇ Options") to purchase
▇▇▇▇▇ Common Stock granted under ▇▇▇▇▇' Stock Option Plan, as amended (the
"▇▇▇▇▇ Plan"), and each warrant for the purchase of ▇▇▇▇▇ Stock (the "▇▇▇▇▇
Warrants") shall be assumed by Access Beyond in accordance with the terms of
such option or warrant, and converted into rights with respect to that number of
shares of Access Beyond Common Stock, determined by multiplying the number of
shares of ▇▇▇▇▇ Stock subject to such ▇▇▇▇▇ Option or ▇▇▇▇▇ Warrant (on an as if
exercised basis) immediately prior to the Effective Time by the Conversion
Ratio, and the exercise price per share for each such option or warrant will
equal the exercise price of the ▇▇▇▇▇ Option or the ▇▇▇▇▇ Warrant immediately
prior to the Effective Time divided by the Conversion Ratio (rounded up to the
nearest whole cent). If the foregoing calculation results in an assumed option
or warrant being exercisable for a fraction of a share, then the number of
shares of Access Beyond Common Stock subject to such option or warrant will be
rounded down to the nearest whole number with no cash being payable for such
fractional share.
1.3.2 Terms of Assumed Options and Warrants. Access Beyond
will administer the ▇▇▇▇▇ Plan assumed pursuant to this Section 1.3 in a manner
that complies with Rule 16b-3 promulgated by the SEC under the Securities
Exchange Act of 1934 ("Exchange Act"). Continuous employment with ▇▇▇▇▇ will be
credited to an optionee for purposes of determining the number of shares subject
to exercise after the Effective Time. The term, exercisability, vesting
schedule, status as an "incentive stock option" under Section 422 of the Code,
if applicable, and all other terms of the ▇▇▇▇▇ Options and ▇▇▇▇▇ Warrants will
otherwise be unchanged. Access Beyond will cause the Access Beyond Common Stock
issued upon exercise of the assumed ▇▇▇▇▇ Options and ▇▇▇▇▇ Warrants (to the
extent that such ▇▇▇▇▇ Warrants were issued in a compensatory transaction and
are otherwise eligible to be registered on Form S-8) together with the Access
Beyond stock option plans in effect after the Effective Time, to the extent same
qualify for such registration and have not previously been registered, to be
registered on Form S-8 of the Securities and Exchange Commission ("SEC") within
90 days after the Effective Time, will exercise reasonably diligent efforts to
maintain the effectiveness of such registration statement for so long as such
assumed ▇▇▇▇▇ Options and such eligible ▇▇▇▇▇ Warrants remain outstanding and
will reserve a sufficient number of shares of Access Beyond Common Stock for
issuance upon exercise of the assumed ▇▇▇▇▇ Options and ▇▇▇▇▇ Warrants.
1.4 Effects of the Merger. At the Effective Time: (a) the separate
existence of Newco will cease and Newco will be merged with and into ▇▇▇▇▇ and
▇▇▇▇▇ will be the surviving corporation pursuant to the terms of the Certificate
of Merger; (b) the Articles of Incorporation and Bylaws of ▇▇▇▇▇ will remain the
Articles of Incorporation and Bylaws of the surviving corporation; (c) each
share of Newco Common Stock outstanding immediately prior to the Effective Time
will be converted into one outstanding share of ▇▇▇▇▇ Common Stock; (d) the
directors of ▇▇▇▇▇ to be in effect subsequent to the Effective Time will be the
directors of ▇▇▇▇▇ as the surviving corporation and the officers of ▇▇▇▇▇ will
remain the officers of ▇▇▇▇▇ as the
5
surviving corporation; (e) each share of ▇▇▇▇▇ Stock and each ▇▇▇▇▇ Option and
▇▇▇▇▇ Warrant outstanding immediately prior to the Effective Time will be
converted as provided in Section 1.1, 1.2 and 1.3; and (f) the Merger will, at
and after the Effective Time, have all of the effects provided by applicable
law.
1.5 Tax-Free Reorganization. The Parties intend to adopt this
Agreement as a tax-free plan of reorganization and to consummate the Merger in
accordance with the provisions of Section 368(a)(1)(A) of the Code. The Parties
believe that the value of the Access Beyond Stock to be received in the Merger
is equal, in each instance, to the value of the ▇▇▇▇▇ Stock to be surrendered in
exchange therefor. The Access Beyond Stock issued in the Merger will be issued
solely in exchange for the ▇▇▇▇▇ Stock, and no other transaction other than the
Merger represents, provides for or is intended to be an adjustment to, the
consideration paid for the ▇▇▇▇▇ Stock. Except for cash paid in lieu of
fractional shares or for Dissenting Shares, no consideration that could
constitute "other property" within the meaning of Section 356 of the Code is
being paid by Access Beyond for the ▇▇▇▇▇ Stock in the Merger. The Parties shall
not take a position on any tax returns inconsistent with this Section 1.5. In
addition, Access Beyond represents now, and as of the Closing, that it presently
intends to continue ▇▇▇▇▇' historic business or use a significant portion of
▇▇▇▇▇' business assets in a business. At the Closing, officers of each of Access
Beyond and ▇▇▇▇▇ shall execute and deliver officers' certificates in the forms
of Exhibits 1.5A-B. The provisions and representations contained or referred to
in this Section 1.5 shall survive until the expiration of the applicable statute
of limitations.
1.6 Purchase Accounting Treatment. The Parties intend that the
Merger be treated as a "purchase" for accounting purposes.
1.7 Charter Amendments. Contemporaneously with or immediately prior
to the Closing, the name of Access Beyond will be changed to "▇▇▇▇▇
Communications Inc.", and the Amended and Restated Certificate of Incorporation
of Access Beyond attached hereto as Exhibit 7.13 will become effective,
accomplishing inter alia, the creation of the Access Beyond Series A Stock.
2. REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇.
Except as set forth in the ▇▇▇▇▇ disclosure letter (the "▇▇▇▇▇
Disclosure Letter") a draft of which was delivered by ▇▇▇▇▇ on July 28, 1997, to
Access Beyond herewith (which letter may be updated in an immaterial manner up
to the Closing), including items in the ▇▇▇▇▇ Disclosure Letter referred to as
"Items" below, and except as disclosed in the ▇▇▇▇▇ Financial Statements (as
defined below) which have heretofore been delivered to Access Beyond, ▇▇▇▇▇
hereby represents and warrants to Access Beyond as follows:
2.1 Organization and Good Standing. ▇▇▇▇▇ is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Georgia, has the corporate power and authority to own, operate and lease its
properties and to carry on its business as now
6
conducted and is qualified as a foreign corporation in each jurisdiction listed
on Item 2.1. ▇▇▇▇▇ does not own or lease any real property, has no employees and
does not maintain a place of business in any foreign country or in any state of
the United States other than as shown on Item 2.1.
2.2 Subsidiaries. Except for the subsidiaries of ▇▇▇▇▇ listed on
Item 2.2 (collectively, the "▇▇▇▇▇ Subsidiaries," and each, a "▇▇▇▇▇
Subsidiary"), each of which is wholly owned by ▇▇▇▇▇, ▇▇▇▇▇ does not have any
subsidiaries or any interest, direct or indirect, in any corporation,
partnership, joint venture or other business entity. Each ▇▇▇▇▇ Subsidiary is a
corporation duly organized, validly existing and in good standing under the laws
of the State of its formation, has the corporate power and authority to own,
operate and lease its properties and to carry on its business as now conducted
and is qualified as a foreign corporation in each jurisdiction listed on Item
2.2, and in any jurisdiction in which qualification is required, except in those
jurisdictions where failure to be qualified would not have a material adverse
effect on the business or operations of ▇▇▇▇▇.
2.3 Power, Authorization and Validity.
2.3.1 Organization. ▇▇▇▇▇ has the corporate right, power,
legal capacity and authority to enter into and perform its obligations under
this Agreement, and all agreements to which ▇▇▇▇▇ or its shareholders are or
will be parties that are required to be executed pursuant to this Agreement.
This Agreement has been duly and validly approved by the ▇▇▇▇▇ Board of
Directors and, upon submission to, and majority vote in favor of the Merger by
the ▇▇▇▇▇ shareholders, by the ▇▇▇▇▇ shareholders, as required by applicable
law.
2.3.2 Authorization. No filing, authorization or approval,
governmental or otherwise, is necessary to enable ▇▇▇▇▇ or to ▇▇▇▇▇' knowledge
any of the Principal ▇▇▇▇▇ Shareholders and other ▇▇▇▇▇ shareholders, officers
or directors parties thereto to enter into, and to perform their obligations
under, this Agreement, the ▇▇▇▇▇ Affiliate Agreements, the Voting Agreements and
the Market Standoff Agreements, except for: (a) the filing of the Certificate of
Merger with the Secretary of State of Georgia, the filing of such officers'
certificates and other documents as are required to effectuate the Merger under
Georgia law and the filing of appropriate documents with the relevant
authorities of the states other than Georgia in which ▇▇▇▇▇ is qualified to do
business, if any, (b) such filings as may be required to comply with federal and
state securities laws, (c) consents required under contracts disclosed in Item
2.5 as exceptions to the representation made in the last sentence of Section 2.5
below, (d) the approval of the ▇▇▇▇▇ shareholders of the transactions
contemplated hereby and (e) the filings required by the HSR Act (defined in
Section 4.6).
2.3.3 Enforceability. This Agreement, the ▇▇▇▇▇ Affiliate
Agreements, the Voting Agreement and the Market Standoff Agreements are, or when
executed and delivered by ▇▇▇▇▇ and the other parties thereto will be, valid and
binding obligations of ▇▇▇▇▇ and, as applicable, the Principal ▇▇▇▇▇
Shareholders and other ▇▇▇▇▇ shareholders, directors and officers
7
parties thereto enforceable against such persons or entities in accordance with
their respective terms, except as to the effect, if any, of (a) applicable
bankruptcy and other similar laws affecting the rights of creditors generally
and (b) rules of law governing specific performance, injunctive relief and other
equitable remedies.
2.4 Capitalization.
2.4.1 Capital Stock. The authorized capital stock of ▇▇▇▇▇
consists of 100,000,000 shares of ▇▇▇▇▇ Common Stock, $0.01 par value per share,
10,000,000 shares of ▇▇▇▇▇ Series A Stock and 263,113 shares of ▇▇▇▇▇ Series B
Stock. 4,991,750 shares of ▇▇▇▇▇ Common Stock, 4,900,000 shares of ▇▇▇▇▇ Series
A Stock and 263,113 shares of ▇▇▇▇▇ Series B Stock are issued or outstanding as
of the date of this Agreement and will be immediately prior to the Closing, all
of which are held of record and owned by the ▇▇▇▇▇ shareholders identified in
Item 2.4. Except as set forth in the ▇▇▇▇▇ Amended and Restated Articles of
Incorporation, each share of ▇▇▇▇▇ Series A Stock and each share of ▇▇▇▇▇ Series
B Stock is convertible into one share of ▇▇▇▇▇ Common Stock. None of the
outstanding ▇▇▇▇▇ Stock carries any mandatory redemption rights, other than the
▇▇▇▇▇ Series B Preferred Stock. All issued and outstanding shares of ▇▇▇▇▇ Stock
have been duly authorized and validly issued, are fully paid and nonassessable,
are not subject to any right of rescission and have been offered, issued, sold
and delivered by ▇▇▇▇▇ in compliance with all registration or qualification
requirements (or applicable exemptions therefrom) of applicable federal and
state securities laws.
2.4.2 Options/Warrants/Rights. As of the date hereof, 400,000
shares of ▇▇▇▇▇ Common Stock are subject to issued and outstanding warrants to
purchase shares of ▇▇▇▇▇ Common Stock. As of the date hereof, an aggregate of
1,800,000 shares of ▇▇▇▇▇ Common Stock are reserved and authorized for issuance
pursuant to the ▇▇▇▇▇ Plan, of which options to purchase a total of 1,414,750
shares of ▇▇▇▇▇ Common Stock are issued and outstanding. Also, shares of ▇▇▇▇▇
Common Stock are reserved and authorized for issuance pursuant to conversion of
the Notes described in Section 5.3.1 of this Agreement, which notes constitute
all issued and outstanding debt that is convertible into any shares of ▇▇▇▇▇
Stock. A list of all holders of ▇▇▇▇▇ Stock and options or warrants to purchase
▇▇▇▇▇ Stock as of the date hereof, and the number of shares, options and
warrants held by each has been delivered by ▇▇▇▇▇ to Access Beyond as Item 2.4,
which will be updated at the Closing. Except as set forth in this Section, there
are no options, warrants, calls, commitments, conversion privileges or
preemptive or other rights or agreements outstanding to purchase any of ▇▇▇▇▇',
or any of the ▇▇▇▇▇ Subsidiaries' authorized but unissued capital stock or any
securities convertible into or exchangeable for shares of ▇▇▇▇▇ Stock or the
securities of any ▇▇▇▇▇ Subsidiary or obligating ▇▇▇▇▇ or any such ▇▇▇▇▇
Subsidiary to grant, extend, or enter into any such option, warrant, call,
right, commitment, conversion privilege or other right or agreement, and there
is no liability for dividends accrued but unpaid. There are no voting
agreements, rights of first refusal or other restrictions (other than normal
restrictions on transfer under applicable federal and state securities laws)
applicable to any of ▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiaries' outstanding securities.
Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary is under any
8
obligation to register under the Securities Act of 1933, as amended (the
"Securities Act") any of its presently outstanding securities or any securities
that may be subsequently issued.
2.5 No Conflict or Violation. Neither the execution and delivery of
this Agreement nor the consummation of the transactions provided for herein,
will conflict with, or (with or without notice or lapse of time, or both) result
in a termination, breach, impairment or violation of, (a) any provision of the
Articles of Incorporation or Bylaws of ▇▇▇▇▇, as currently in effect, (b) any
material instrument or contract to which ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary is a
Party or by which ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary is bound (including, without
limitation, the ▇▇▇▇▇ Material Agreements described in Section 2.11) or (c) any
federal, state, local or foreign judgment, writ, decree, order, statute, rule or
regulation applicable to, and that would have a material adverse effect on,
▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary or any of their assets or properties. The
consummation of the Merger in and of itself will not require the consent of any
third party, will not have a material adverse effect upon any such rights,
licenses, franchises, leases or agreements pursuant to the terms of the ▇▇▇▇▇
Material Agreements and will not be affected by, or require compliance with,
Section 14-2-1111 of the Georgia Law.
2.6 Litigation. There is no action, proceeding or investigation
pending or, to ▇▇▇▇▇' actual knowledge, threatened against ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary before any court or administrative agency that, if determined
adversely to ▇▇▇▇▇ or such subsidiary, may reasonably be expected to have a
material adverse effect on the present or future operations or financial
condition of ▇▇▇▇▇ or, except as set forth in Item 2.6, in which the adverse
party or parties seek to recover in excess of $200,000 against ▇▇▇▇▇ or such
subsidiary. Except as set forth in Item 2.6, there is no basis for any person,
firm, corporation or entity to assert a claim against ▇▇▇▇▇, any ▇▇▇▇▇
Subsidiary or Access Beyond as the sole shareholder of ▇▇▇▇▇ immediately
following the Closing based upon: (a) ownership or rights to ownership of any
shares of ▇▇▇▇▇ Stock or ▇▇▇▇▇ Subsidiary capital stock, (b) any rights as a
▇▇▇▇▇ or ▇▇▇▇▇ Subsidiary securities holder, including, without limitation, any
option or other right to acquire any ▇▇▇▇▇ or ▇▇▇▇▇ Subsidiary securities, any
preemptive rights or any rights to notice or to vote or (c) any rights under any
agreement between ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary and any ▇▇▇▇▇ or ▇▇▇▇▇
Subsidiary securities holder or former securities holder in such holder's
capacity as such.
2.7 ▇▇▇▇▇ Financial Statements. ▇▇▇▇▇ has delivered to Access Beyond
▇▇▇▇▇' audited consolidated balance sheet as of December 31, 1996 (the "▇▇▇▇▇
Balance Sheet Date") and a consolidated income statement and statement of cash
flows for the year then ended, and ▇▇▇▇▇' consolidated unaudited balance sheet,
income statement and cash flow statement for the period from January 1, 1997
through June 30, 1997 (collectively, the "▇▇▇▇▇ Financial Statements"). The
▇▇▇▇▇ Financial Statements, in all material respects, (a) are in accordance with
the books and records of ▇▇▇▇▇, (b) fairly and accurately present the financial
condition of ▇▇▇▇▇ and its subsidiaries at the respective dates specified
therein and the results of operations for the respective periods specified
therein and (c) except as may be indicated in the notes thereto, were prepared
in accordance with generally accepted accounting principles consistently applied
(subject in the case of unaudited financial statements to normal, year-end audit
adjustments and the absence of
9
footnotes) ("GAAP"). ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have no material debt,
liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, that is not reflected, reserved
against or disclosed in the ▇▇▇▇▇ Financial Statements, except for those that
may have been incurred after the ▇▇▇▇▇ Balance Sheet Date in the ordinary course
of business, or are not required to be included in a balance sheet prepared in
accordance with GAAP. The inventories of ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries are of
quality and quantity usable or salable in the ordinary course of business, the
aggregate value of which has been written down on the books of said corporations
to realizable market value or with respect to which adequate reserves have been
provided in accordance with GAAP.
2.8 Taxes. ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have filed all federal,
state, local and foreign tax and material information returns required to be
filed prior to the date hereof, have paid all taxes required to be paid in
respect of all periods prior to the date hereof for which returns have been
filed, have made all necessary estimated tax payments, and have no liability for
taxes in excess of the amount so paid, except to the extent adequate reserves
have been established in the ▇▇▇▇▇ Financial Statements. True and complete
copies of all such tax and information returns have been provided or made
available by ▇▇▇▇▇ to Access Beyond. Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary is
delinquent in the payment of any tax or in the filing of any tax returns, and no
deficiencies for any tax have been threatened, claimed, proposed or assessed
which have not been settled or paid. No tax return of ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary has been audited by the Internal Revenue Service or any state taxing
agency or authority during the past seven fiscal years or the current fiscal
year. For the purposes of this Section 2.8 and Section 3.8. the terms "tax" and
"taxes" include all federal, state, local and foreign income, gains, franchise,
excise, property, sales, use, employment, license, payroll. occupation,
recording, value added or transfer taxes, governmental charges, fees, levies or
assessments (whether payable directly or by withholding), and, with respect to
such taxes, any estimated tax, interest and penalties or additions to tax and
interest on such penalties and additions to tax. ▇▇▇▇▇ has no current or
deferred federal income tax liabilities on a consolidated basis, and will not as
a result of the Merger become liable for any income tax not adequately reserved
against on the Financial Statements. Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has
filed a consent pursuant to Section 341(f) of the Code.
2.9 Title to Properties. ▇▇▇▇▇ and each ▇▇▇▇▇ Subsidiary has good
and marketable title to all of its assets as shown on the balance sheet as of
the ▇▇▇▇▇ Balance Sheet Date included in the ▇▇▇▇▇ Financial Statements, free
and clear of all liens, charges or encumbrances (other than for taxes not yet
due and payable and ▇▇▇▇▇ Permitted Liens as defined below), other than such
assets as were sold by ▇▇▇▇▇ in the ordinary course of business since the ▇▇▇▇▇
Balance Sheet Date or which are subject to capitalized leases. "▇▇▇▇▇ Permitted
Liens" means any lien, mortgage, encumbrance or restriction which is reflected
in the ▇▇▇▇▇ Financial Statements and is not in excess of $50,000 and which does
not materially detract from the value or materially interfere with the use, as
currently utilized, of the properties subject thereto or affected thereby or
otherwise materially impair the business operations being conducted thereon.
There are no UCC financing statements of record with the State of Georgia, or
any other State where ▇▇▇▇▇ and each ▇▇▇▇▇ Subsidiary owns or leases property,
naming ▇▇▇▇▇ and each ▇▇▇▇▇
10
Subsidiary as debtor. The machinery and equipment included in such assets are,
in all material respects, in good condition and repair, normal wear and tear
excepted. All leases of real or personal property to which ▇▇▇▇▇ and each ▇▇▇▇▇
Subsidiary is a party are fully effective and afford ▇▇▇▇▇ and each ▇▇▇▇▇
Subsidiary adequate possession of the subject matter of the lease. To its
knowledge, neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary is in violation of any
material zoning, building, safety or environmental ordinance, regulation or
requirement or other law or regulation applicable to the operation of owned or
leased properties, and ▇▇▇▇▇ and each ▇▇▇▇▇ Subsidiary has not received any
notice of such violation with which it has not complied or had waived.
2.10 Absence of Certain Changes. Since the ▇▇▇▇▇ Balance Sheet Date,
▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have carried on their business in the ordinary
course substantially in accordance with the procedures and practices in effect
on the ▇▇▇▇▇ Balance Sheet Date, and there has not been with respect to ▇▇▇▇▇
and the ▇▇▇▇▇ Subsidiaries:
(a) any contingent liability incurred by ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary as guarantor or surety with respect to the obligations of
others;
(b) any mortgage, encumbrance or lien placed on any of the
properties of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, other than liens for taxes
not yet due and payable and ▇▇▇▇▇ Permitted Liens;
(c) any material obligation or liability incurred by ▇▇▇▇▇ or
any ▇▇▇▇▇ Subsidiary other than in the ordinary course of business;
(d) any purchase or sale or other disposition, or any
agreement or other arrangement for the purchase, sale or other
disposition, of any of the properties or assets of ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary other than in the ordinary course of business or in amounts
that are not material to ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries or their
businesses considered as a whole;
(e) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business
of ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries or their businesses considered as a
whole;
(f) any declaration, setting aside or payment of any dividend
on, or the making of any other distribution in respect of, the capital
stock of ▇▇▇▇▇, any split, stock dividend, combination or recapitalization
of the capital stock of ▇▇▇▇▇ or any direct or indirect redemption,
purchase or other acquisition by ▇▇▇▇▇ of any ▇▇▇▇▇ Stock;
(g) any unresolved labor dispute or claim of material unfair
employment or labor practices, any change in the compensation payable, or
to become payable, to any of ▇▇▇▇▇' or of any ▇▇▇▇▇ Subsidiaries'
officers, employees or agents earning compensation at an anticipated
annual rate in excess of $50,000, or any bonus payment or
11
arrangement made to or with any of such officers, employees or agents; or
any change in the compensation payable or to become payable to any of
▇▇▇▇▇' or of any ▇▇▇▇▇ Subsidiaries' other officers, employees or agents
other than normal annual raises and bonuses in accordance with past
practice;
(h) any change with respect to the senior management or other
key personnel of ▇▇▇▇▇ (each of whom is listed in Item 2.15) or of any
▇▇▇▇▇ Subsidiary, except as contemplated by this Agreement and its
Exhibits;
(i) any payment or discharge of a material lien or liability
thereof, which lien or liability was not either (i) shown on the balance
sheet as of the ▇▇▇▇▇ Balance Sheet Date included in the ▇▇▇▇▇ Financial
Statements or (ii) incurred in the ordinary course of business after the
▇▇▇▇▇ Balance Sheet Date;
(j) any obligation or liability incurred by ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary to any of their officers, directors or shareholders, or any
loans or advances made to any of their officers, directors. shareholders
or affiliates, except normal compensation and expense allowances payable
to officers; or
(k) any material deterioration in the relationship of ▇▇▇▇▇ or
any of the ▇▇▇▇▇ Subsidiaries with any customer or supplier, which would
have a material adverse effect on the businesses of ▇▇▇▇▇ and the ▇▇▇▇▇
Subsidiaries, taken as a whole.
2.11 Agreements and Commitments. A list of oral or written executory
agreements, obligations or commitments that are material to ▇▇▇▇▇, any ▇▇▇▇▇
Subsidiary or their businesses, taken as a whole (the "▇▇▇▇▇ Material
Agreements"), is included as Item 2.11, true and complete copies of which have
been or will be delivered to Access Beyond or Access Beyond's counsel. Each
▇▇▇▇▇ Material Agreement is valid and in full force and effect. Neither ▇▇▇▇▇
nor, to the knowledge of ▇▇▇▇▇, any other party, is in breach of, or default
under, any material term of any such ▇▇▇▇▇ Material Agreement. Except for the
▇▇▇▇▇ Material Agreements, neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary is a party or
subject to any oral or written executory agreement, obligation or commitment
that is material to ▇▇▇▇▇, any ▇▇▇▇▇ Subsidiary or their businesses, taken as a
whole, that is not terminable within 60 days without cost or penalty to ▇▇▇▇▇ or
any ▇▇▇▇▇ Subsidiary, including but not limited to the following:
(a) Any contract, commitment, letter agreement, quotation or
purchase order providing for payment by or to ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary of $200,000 or more, or any contract or arrangement that ▇▇▇▇▇
reasonably believes will have a material adverse effect on their
businesses, taken as a whole;
(b) Any license agreement under which ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary is licensor or licensee (except for any nonexclusive software
license granted by ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary to end-user customers
where the form of the license, excluding
12
standard immaterial deviations, has been provided to Access Beyond's
counsel or for standard "shrink wrap" licenses for off-the-shelf software
products);
(c) Any agreement by ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary to
encumber, transfer or sell rights in or with respect to any ▇▇▇▇▇
Intellectual Property (as defined in Section 2.12 hereof);
(d) Any agreement for the sale or lease of real or personal
property involving more than $200,000 per year;
(e) Any dealer, distributor. sales representative, original
equipment manufacturer, value added remarketer or other agreement for the
distribution of any ▇▇▇▇▇ product or the product of any ▇▇▇▇▇ Subsidiary;
(f) Any franchise agreement or financing statement covering a
substantial portion of the assets of ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries
taken as a whole;
(g) Any stock redemption or purchase agreement;
(h) Any joint venture contract or arrangement or any other
agreement that involves a sharing of profits with other persons or the
payment of royalties to any other person;
(i) Any instrument evidencing indebtedness for borrowed money
by way of direct loan, sale of debt securities, purchase money obligation,
conditional sale, guarantee or otherwise, or any advance to any employee
of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, except for trade indebtedness incurred
in the ordinary course of business or as disclosed in the ▇▇▇▇▇ Financial
Statements; or
(j) Any contract containing covenants purporting to limit
▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiary's freedom to compete in any line of
business in any geographic area.
2.12 Intellectual Property. ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries own all
right, title and interest in, or have the right to use, all patent applications,
patents, trademark applications, trademarks, service marks, trade names,
copyright applications, copyrights, trade secrets, know-how, technology and
other intellectual property and proprietary rights used in or reasonably
necessary to the conduct of its business as presently conducted and the business
of the development, production, marketing, licensing and sale of commercial
products using such intellectual property and proprietary rights ("▇▇▇▇▇
Intellectual Property"). ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have taken all
reasonable measures to protect all ▇▇▇▇▇ Intellectual Property, and ▇▇▇▇▇ is not
aware of any infringement of any ▇▇▇▇▇ Intellectual Property by any third party.
Set forth in Item 2.12 delivered to Access Beyond herewith is a true and
complete list of all copyright, mask work and trademark registrations and
applications and all patents and patent applications for
13
▇▇▇▇▇ Intellectual Property owned by ▇▇▇▇▇ or any of the ▇▇▇▇▇ Subsidiaries.
▇▇▇▇▇ is not aware of any material loss, cancellation, termination or expiration
of any such registration or patent. To ▇▇▇▇▇' knowledge, the business of ▇▇▇▇▇
and the ▇▇▇▇▇ Subsidiaries, as conducted as of the date hereof, does not
infringe or violate any of the patents, trademarks, service marks, trade names,
mask works, copyrights, trade secrets, proprietary rights or other intellectual
property of any other person, and neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has
received any written or oral claim or notice of infringement or potential
infringement of property of any other person which could be expected to have a
material adverse effect on ▇▇▇▇▇, and ▇▇▇▇▇ Subsidiary or their businesses,
taken as a whole.
2.13 Compliance with Laws. ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have
complied, or prior to the Closing (as defined in Section 6.1 hereof) will have
complied, and are or will be at the Closing, in full compliance in all respects
material to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary with all applicable laws, ordinances,
regulations and rules, and all orders, writs, injunctions, awards, judgments and
decrees, applicable to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary or to the properties and
business of ▇▇▇▇▇ or such subsidiary, including, without limitation: (a) all
applicable federal and state securities laws and regulations, (b) all applicable
federal, state and local laws, ordinances and regulations, and all orders,
writs, injunctions, awards, judgments and decrees, pertaining to (i) the sale,
licensing, leasing, ownership or management of ▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiary's
owned, leased or licensed real or personal property, products or technical data,
(ii) employment or employment practices, terms and conditions of employment, or
wages and hours or (iii) safety, health, fire prevention, environmental
protection (including toxic waste disposal and related matters described in
Section 2.19 hereof), building standards, zoning or other similar matters, (c)
laws, regulations, rules, orders, writs, injunctions, judgments or decrees
applicable to the export or re-export of controlled commodities or technical
data or (d) the Immigration Reform and Control Act. ▇▇▇▇▇ and the ▇▇▇▇▇
Subsidiaries have received all material permits and approvals from, and have
made all material filings with, third parties, including government agencies and
authorities, that are necessary to the conduct of their businesses as presently
conducted.
2.14 Certain Transactions and Agreements. No person who is an
officer or director of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, or a member of any
officer's or director's immediate family, has any direct or indirect ownership
interest in, or any employment or consulting agreement with any firm or
corporation that competes with ▇▇▇▇▇, any ▇▇▇▇▇ Subsidiary or Access Beyond
(except with respect to any interest in less than 1% of the outstanding voting
shares of any corporation whose stock is publicly traded). No person who is an
officer or director of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, or any member of any
officer's or director's immediate family, is directly or indirectly interested
in any material contract or informal arrangement with ▇▇▇▇▇ or any ▇▇▇▇▇
Subsidiary, including, but not limited to, any loan arrangements, except for
compensation for services as an officer, director or employee of ▇▇▇▇▇ or such
subsidiary and except for the normal rights of a shareholder. None of such
officers or directors, the compensation arrangements for whom are described in
Item 2.15, or family members has any interest in any property, real or personal,
tangible or intangible, including, without limitation,
14
inventions, patents, copyrights, trademarks, trade names or trade secrets, used
in the business of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, except for the normal rights
of a shareholder.
2.15 Employees.
2.15.1 Identification. A list of all officers, key employees
and key consultants (other than attorneys and accountants of ▇▇▇▇▇ and the ▇▇▇▇▇
Subsidiaries and the current compensation and benefits of such persons as of the
date of this Agreement is set forth in Item 2.15. Except as contemplated by this
Agreement, ▇▇▇▇▇ has no knowledge of any facts indicating that any of its
officers, directors or key employees (each of whom is identified in Item 2.15)
intends to leave ▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiary's employ.
2.15.2 Contracts. Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has
any employment contract or consulting agreement currently in effect that is not
terminable at will without penalty or payment of compensation by ▇▇▇▇▇ or any
▇▇▇▇▇ Subsidiary other than (a) severance compensation as provided in the
applicable contracts, and (b) agreements with the sole purpose of providing for
the confidentiality of proprietary information or assignment of inventions. All
employees and consultants of ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries have executed
▇▇▇▇▇' standard form of assignments to ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries of
copyright and other intellectual property rights. To ▇▇▇▇▇' knowledge, no
employee of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary is in material violation of any term
of any employment contract, nondisclosure agreement or noncompetition agreement
or any restrictive covenant, relating to the right of any such employee to be
employed by ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary or to use trade secrets or proprietary
information of others.
2.15.3 Organized Labor. Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary
(a) has been or is now subject to a union organizing effort, (b) is subject to
any collective bargaining agreement with respect to any of its employees, (c) is
subject to any other contract, written or oral, with any trade or labor union,
employees' association or similar organization or (d) has any labor dispute that
has not been resolved.
2.15.4 Identification of ▇▇▇▇▇ Employee Plans. Item 2.15
delivered by ▇▇▇▇▇ to Access Beyond in the ▇▇▇▇▇ Disclosure Letter contains a
list of all employment and consulting agreements, pension, retirement,
disability, medical, dental or other health plans, life insurance or other death
benefit plans, profit sharing, deferred compensation agreements, stock, option,
bonus or other incentive plans, vacation, sick, holiday or other paid leave
plans, severance plans or other similar employee benefit plans maintained by
▇▇▇▇▇ or any of the ▇▇▇▇▇ Subsidiaries (the "▇▇▇▇▇ Employee Plans"), including
without limitation all "employee benefit plans" as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). ▇▇▇▇▇
has delivered true and complete copies or descriptions of all the ▇▇▇▇▇ Employee
Plans to Access Beyond and Access Beyond's counsel.
15
2.15.5 Conduct of ▇▇▇▇▇ Employee Plans. All contributions due
from ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary with respect to any of the ▇▇▇▇▇ Employee
Plans have been made or accrued on ▇▇▇▇▇' financial statements, and no further
contributions will be due or will have accrued thereunder as of the Closing.
Each of the ▇▇▇▇▇ Employee Plans, and its operation and administration, is, in
all material respects, in compliance with all applicable, federal, state, local
and other governmental laws and ordinances, orders, rules and regulations,
including the requirements of ERISA and the Code. All such ▇▇▇▇▇ Employee Plans
that are "employee pension benefit plans" (as defined in Section 3(2) of ERISA)
which are intended to qualify under Section 401(a)(8) of the Code have received
favorable determination letters that such plans satisfy the qualification
requirements of the Tax Equity and Fiscal Responsibility Act of 1982, the
Deficit Reduction Act of 1984 and the Retirement Equity Act of 1984. In
addition, neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has been a participant in any
"prohibited transaction," within the meaning of Section 406 of ERISA with
respect to any employee pension benefit plan (as defined in Section 3(2) of
ERISA) which ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary sponsors as employer or in which
▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary participates as an employer, which was not
otherwise exempt pursuant to Section 408 of ERISA (including any individual
exemption granted under Section 408(a) of ERISA), or which could result in an
excise tax under the Code. The group health plans, as defined in Section
4980B(g) of the Code, that benefit employees of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiaries
are in material compliance with the continuation coverage requirements of
subsection 4980B of the Code. There are no outstanding violations of Section
4980B of the Code with respect to any ▇▇▇▇▇ Employee Plan, covered employees or
qualified beneficiaries.
2.15.6 Effect of Agreement. Neither ▇▇▇▇▇ nor any ▇▇▇▇▇
Subsidiary is a party to any agreement with any executive officer or other key
employee (a) the benefits of which are contingent, or the terms of which are
materially altered, upon the occurrence of a transaction involving ▇▇▇▇▇ in the
nature of any of the transactions contemplated by this Agreement, (b) providing
any term of employment or compensation guarantee or (c) providing severance
benefits or other benefits after the termination of employment of such employee.
Neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary is a party to any agreement or plan,
including, without limitation, any stock option plan, stock appreciation rights
plan or stock purchase plan, (a) any of the benefits of which will be materially
increased, or the vesting of benefits of which will be materially accelerated,
by the occurrence of any of the transactions contemplated by this Agreement or
(b) the value of any of the benefits of which will be calculated on the basis of
any of the transactions contemplated by this Agreement, except for the vesting
of certain exercisability rights under the ▇▇▇▇▇ Warrant Plan and the ▇▇▇▇▇
Stock Option Plan, and except as described on Exhibit C-5 hereto. Neither ▇▇▇▇▇
nor any ▇▇▇▇▇ Subsidiary is obligated to make any excess parachute payment, as
defined in Section 280G(b)(1) of the Code, nor will any excess parachute payment
be deemed to have occurred as a result of or arising out of the Merger to the
extent Section 280G of the Code is applicable to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary.
2.16 Corporate Documents. ▇▇▇▇▇ will make available to Access
Beyond for examination all documents and information listed in the ▇▇▇▇▇
Disclosure Letter that are requested by Access Beyond's legal counsel,
including, without limitation, the following: (a) copies of
16
▇▇▇▇▇' and each ▇▇▇▇▇ Subsidiary's Articles of Incorporation and Bylaws as
currently in effect; (b) ▇▇▇▇▇' and each ▇▇▇▇▇ Subsidiary's minute book
containing all records of all proceedings, consents, actions and meetings of
their directors and shareholders; (c) stock records reflecting all stock
issuances and transfers of the securities of ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries;
and (d) all permits, orders and consents issued by any regulatory agency with
respect to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary, or any securities of ▇▇▇▇▇ or any
▇▇▇▇▇ Subsidiary, and all applications for such permits, orders and consents.
2.17 Books and Records. The books, records and accounts of ▇▇▇▇▇ and
each ▇▇▇▇▇ Subsidiary (a) are in all material respects true and complete, (b)
have been maintained in accordance with reasonable business practices on a basis
consistent with prior years, (c) are stated in reasonable detail and accurately
and fairly reflect the transactions and dispositions of the assets of ▇▇▇▇▇ and
such subsidiary and (d) accurately and fairly reflect the basis for the ▇▇▇▇▇
Financial Statements.
2.18 Insurance. ▇▇▇▇▇ and the ▇▇▇▇▇ Subsidiaries maintain fire and
casualty, workers compensation and general liability insurance as listed in Item
2.18.
2.19 Environmental Matters. During the period that ▇▇▇▇▇ or any
▇▇▇▇▇ Subsidiary has leased the premises currently occupied by it and those
premises occupied by it since the date of its incorporation, there have been no
disposals, releases or threatened releases by ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary of
Hazardous Materials (as defined below) on any such premises that would have a
material adverse effect upon ▇▇▇▇▇, any ▇▇▇▇▇ Subsidiary or any of their
businesses. ▇▇▇▇▇ has no knowledge of any presence, disposals, releases or
threatened releases of Hazardous Materials on or from any of such premises,
which may have occurred prior to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary having taken
possession of any of such premises that would have a material adverse effect
upon ▇▇▇▇▇, any ▇▇▇▇▇ Subsidiary or any of their businesses. For purposes of
this Agreement, the terms "disposal," "release," and "threatened release" have
the definitions assigned thereto by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq., as amended
("CERCLA"). For the purposes of this Agreement, "Hazardous Materials" mean any
hazardous or toxic substance, material or waste which is or becomes prior to the
Closing Date (as defined in Section 6.1 hereof) regulated under, or defined as a
"hazardous substance," "pollutant," "contaminant," "toxic chemical," "hazardous
material," "toxic substance" or "hazardous chemical" under (a) CERCLA; (b) the
Emergency Planning and Community Right-to-Know Act, 42 U.S.C. Section 11001 et
seq.; ( c) the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801,
et seq.; (d) the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.;
(e) the Occupational Safety and Health Act of 1970, 29 U.S.C. Section 651 et
seq.; (f) regulations promulgated under any of the above statutes; or (g) any
applicable state or local statute, ordinance, rule or regulation that has a
scope or purpose similar to those identified above.
2.20 Government Contracts. All representations, certifications and
disclosures made by ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary to any Government Contract
Party (as defined below)
17
have been in all material respects current, complete and accurate at the times
they were made. There have been no acts, omissions or noncompliance with regard
to any applicable public contracting statute, regulation or contract requirement
(whether express or incorporated by reference) relating to any of ▇▇▇▇▇' or any
▇▇▇▇▇ Subsidiary's contracts with any Government Contract Party in either case
that have led to or could lead to, either before or after the Closing, (a,) any
claim or dispute involving ▇▇▇▇▇, any ▇▇▇▇▇ Subsidiary and any Government
Contract Party or (b) any suspension, debarment. contract renegotiation, or
contract termination, or proceeding related thereto. There has been no act or
omission that relates to the marketing, licensing or selling to any Government
Contract Party of any of ▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiary's technical data and
computer software and that has led to or could lead to, either before or after
the Closing, any material cloud on any of ▇▇▇▇▇' or any ▇▇▇▇▇ Subsidiary's
rights in and to its technical data and computer software. All of ▇▇▇▇▇' and the
▇▇▇▇▇ Subsidiaries' development of technical data and computer software was
developed exclusively at private expense. For purposes of this Agreement, the
term "Government Contract Party" means any independent or executive agency,
division, subdivision, audit group or procuring office of the federal
government, including any prime contractor of the federal government and any
higher level subcontractor of a prime contractor of the federal government, and
including any employees or agents thereof, in each case acting in such capacity.
2.21 No Brokers. Neither ▇▇▇▇▇ or any of the ▇▇▇▇▇ Subsidiaries is
obligated for the payment of fees or expenses of any investment banker, broker
or finder in connection with the origin, negotiation or execution of this
Agreement or in connection with any transaction provided for herein.
2.22 Information Supplied. None of the information supplied or to be
supplied by ▇▇▇▇▇ for inclusion in the Form S-4 and the Prospectus/Proxy
Statement, at the date such information is supplied and at the time of the
meetings of the ▇▇▇▇▇ shareholders and the Access Beyond stockholders to be held
to approve the Merger, contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading, or will, in the
case of the Form S-4, at the time the Form S-4 becomes effective under the
Securities Act, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading.
2.23 Interested Party Transactions. Except as set forth in Item
2.23, no officer or director of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary or any "affiliate"
or "associate" (as those terms are defined in Rule 405 promulgated under the
Securities Act) of any such person has had, either directory or indirectly, a
material interest in: (a) any person or entity which purchases from or sells,
licenses or furnishes to ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary any goods, property,
technology or intellectual or other property rights or services; or (b) any
contract or agreement to which ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary is a party or by
which it may be bound or affected.
18
2.24 Real Property Holding Corporation Status. Since its inception,
neither ▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has been a "United States real property
holding corporation," as defined in Section 897(c)(2) of the Code, and in
Section 1.897-2(b) of the Treasury Regulations issued thereunder, and neither
▇▇▇▇▇ nor any ▇▇▇▇▇ Subsidiary has filed with the Internal Revenue Service any
statement with any of its United States income tax returns that are required
under Section 1.897-2(h) of such regulations.
2.25 Disclosure. This Agreement, its exhibits and schedules, and any
of the certificates or documents to be delivered by ▇▇▇▇▇ to Access Beyond under
this Agreement, taken together, do not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which such statements were made, not misleading.
3. REPRESENTATIONS AND WARRANTIES OF ACCESS BEYOND.
Except as set forth in (i) the Access Beyond disclosure letter (the
"Access Beyond Disclosure Letter") delivered by Access Beyond to ▇▇▇▇▇ herewith
(which letter may be updated in an immaterial manner up to the Closing),
including items in the Access Beyond Disclosure Letter referred to as "Items"
below, and (ii) all registration statements, exhibits thereto, proxy statements,
quarterly and other reports and other materials filed by Access Beyond with the
SEC, Access Beyond hereby represents and warrants to ▇▇▇▇▇ as follows.
3.1 Organization and Good Standing. Access Beyond is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware, has the corporate power and authority to own, operate and
lease its properties and to carry on its business as now conducted and is
qualified as a foreign corporation in each jurisdiction listed on Item 3.1.
Access Beyond does not own or lease any real property, has no employees and does
not maintain a place of business in any foreign country or in any state of the
United States, except as set forth in Item 3.1.
3.2 Subsidiaries. Except for the subsidiaries of Access Beyond
listed on Item 3.7 (collectively the "Access Beyond Subsidiaries," and each, an
"Access Beyond Subsidiary"), each of which is wholly owned by Access Beyond,
Access Beyond does not have any subsidiaries or any interest, direct or
indirect, in any corporation, partnership, joint venture or other business
entity. Each Access Beyond Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of the State of its formation, has
the corporate power and authority to own, operate and lease its properties and
to carry on its business as now conducted and is qualified as a foreign
corporation in each Jurisdiction listed on Item 3.2.
19
3.3 Power, Authorization and Validity.
3.3.1 Organization. Access Beyond has and Newco will have the
corporate right, power, legal capacity and authority to enter into and perform
its obligations under this Agreement and all agreements to which such entity is
or will be a party that are required to be executed pursuant to this Agreement
(the "Access Beyond Ancillary Agreements"). This Agreement has been duly and
validly approved by the Access Beyond Board of Directors, and, upon submission
to, and majority vote in favor of the Merger by, the Access Beyond stockholders,
the stockholders of Access Beyond, as required by applicable law and will be
duly and validly approved by the Newco Board of Directors and Shareholders.
3.3.2 Authorization. No filing, authorization or approval,
governmental or otherwise, is necessary to enable Access Beyond to enter into,
and to perform its obligations under, this Agreement and the Access Beyond
Ancillary Agreements, except for: (a) the filing of the Certificate of Merger
with the Secretary of State of Georgia, the filing of such officers'
certificates and other documents as are required to effectuate the Merger under
Georgia law and the filing of appropriate documents with the relevant
authorities of the states other than Georgia in which Access Beyond is qualified
to do business, if any, (b) such filings as may be required to comply with
federal and state securities laws, (c) consents required under contracts
disclosed in Item 3.5 as exceptions to the representation made in the last
sentence of Section 3.5 below, (d) the approval of the Access Beyond
stockholders of the transactions contemplated hereby and (e) the filings
required by the HSR Act. Newco has not entered into any Agreement that would
require the consent of any Party thereto in order to consummate the Merger.
3.3.3 Enforceability. This Agreement and the Access Beyond
Ancillary Agreements are, or when executed and delivered by Access Beyond and
the other parties thereto will be, valid and binding obligations of Access
Beyond enforceable against Access Beyond in accordance with their respective
terms, except as to the effect, if any, of (a) applicable bankruptcy and other
similar laws affecting the rights of creditors generally and (b) rules of law
specific performance, injunctive relief and other equitable remedies.
3.4 Capitalization.
3.4.1 Capital Stock. The authorized capital stock of Access
Beyond consists of 30,000,000 shares of Access Beyond Common Stock, $.01 par
value per share, and 3,000,000 shares of Preferred Stock, the rights,
preferences and privileges of which have not yet been designated as of the date
of this Agreement. 12,495,291 shares of Access Beyond Common Stock and no shares
of Preferred Stock are issued and outstanding as of the date of this Agreement
and as of immediately prior to the Closing. All issued and outstanding shares of
Access Beyond Common Stock have been duly authorized and validly issued, are
fully paid and nonassessable, are not subject to any right of rescission and
have been offered, issued, sold and delivered by Access Beyond in compliance
with all registration or qualification requirements (or applicable exemptions
therefrom) of applicable federal and state securities laws.
20
3.4.2 Options/Warrants/Rights. As of the date hereof, an
aggregate of 2,250,000 shares of Access Beyond Common Stock are reserved and
authorized for issuance pursuant to the following employee benefit plans of
Access Beyond (the "Access Beyond Plans"): (a) 2,000,000 shares reserved for
issuance under the 1996 Long-Term Incentive Plan, the number of shares
underlying outstanding options under such plan being set forth in the Disclosure
Letter and no shares have been purchased upon exercise of such options; and (b)
250,000 shares reserved for issuance under the Amended and Restated 1996
Nonemployee Director Stock Option Plan, the number of shares underlying options
under such Plan being set forth in the Disclosure Letter. A list of all holders
of Access Beyond options or warrants to purchase Access Beyond Stock as of the
date hereof, and the number of options and warrants held by each has been
delivered by Access Beyond to ▇▇▇▇▇ as Item 3.4, which will be updated at the
Closing. Except as set forth in this Section, there are no options, warrants,
calls, commitments, conversion privileges or preemptive or other rights or
agreements outstanding to purchase any of Access Beyond's, or any of the Access
Beyond Subsidiaries' authorized but unissued capital stock or any securities
convertible into or exchangeable for shares of Access Beyond Stock or the
securities of any Access Beyond Subsidiary or obligating Access Beyond or any
such Access Beyond Subsidiary to grant, extend, or enter into any such option,
warrant, call, right, commitment, conversion privilege or other right or
agreement, and there is no liability for dividends accrued but unpaid. There are
no voting agreements, rights of first refusal or other restrictions (other than
normal restrictions on transfer under applicable federal and state securities
laws) applicable to any of Access Beyond's or any Access Beyond Subsidiaries'
outstanding securities. Except with respect to the obligation to register
approximately 503,704 shares of Access Beyond common stock issued to Paradyne
Corporation, and except for registration of shares issuable upon exercise of
options granted under Access Beyond Plans, neither Access Beyond nor any Access
Beyond Subsidiary is under any obligation to register under the Securities Act
any of its presently outstanding securities or any securities that may be
subsequently issued.
3.5 No Conflict or Violation. Neither the execution and delivery of
this Agreement or any Access Beyond Ancillary Agreement, nor the consummation of
the transactions provided for herein or therein, will conflict with, or (with or
without notice or lapse of time, or both) result in a termination, breach,
impairment or violation of, (a) any provision of the Certificate of
Incorporation or Bylaws of Access Beyond, as currently in effect, (b) any
material instrument or contract to which Access Beyond or any Access Beyond
Subsidiary is a party or by which Access Beyond or any Access Beyond Subsidiary
is bound (including, without limitation, the Access Beyond Material Agreements
described in Section 3.11) or (c) any federal, state, local or foreign judgment,
writ, decree, order, statute, rule or regulation applicable to, and that would
have a material adverse effect on, Access Beyond or any Access Beyond Subsidiary
or any of their assets or properties. The consummation of the Merger in and of
itself will not require the consent of any third party and will not have a
material adverse effect upon any such rights, licenses, franchises, leases or
agreements pursuant to the terms of the Access Beyond Material Agreements.
3.6 Litigation. There is no action, proceeding or investigation
pending or, to Access Beyond's actual knowledge, threatened against Access
Beyond or any Access Beyond
21
Subsidiary before any court or administrative agency that, if determined
adversely to Access Beyond or such subsidiary, may reasonably be expected to
have a material adverse effect on the present or future operations or financial
condition of Access Beyond or, except as set forth in Item 3.6, in which the
adverse party or parties seek to recover in excess of $100,000.00 against Access
Beyond or such subsidiary. There is no basis for any person, firm, corporation
or entity to assert a claim against Access Beyond or any Access Beyond
Subsidiary based upon: (a) ownership or rights to ownership of any shares of
Access Beyond Stock or Access Beyond Subsidiary capital stock, (b) any rights as
an Access Beyond or Access Beyond Subsidiary securities holder, including,
without limitation, any option or other right to acquire any Access Beyond or
Access Beyond Subsidiary securities, any preemptive rights or any rights to
notice or to vote or (c) any rights under any agreement between Access Beyond or
any Access Beyond Subsidiary and any Access Beyond or Access Beyond Subsidiary
securities holder or former securities holder in such holder's capacity as such.
3.7 Access Beyond Financial Statements. Access Beyond has delivered
to ▇▇▇▇▇ Access Beyond's audited consolidated balance sheet as of July 31, 1996
(the "Access Beyond Balance Sheet Date") and a consolidated income statement and
statement of cash flows for the year then ended, and Access Beyond's
consolidated unaudited balance sheet, income statement and cash flow statement
for the period from August 1, 1996 through April 30, 1997 (collectively, the
"Access Beyond Financial Statements"). The Access Beyond Financial Statements,
in all material respects, (a) are in accordance with the books and records of
Access Beyond, (b) fairly and accurately present the financial condition of
Access Beyond and its subsidiaries at the respective dates specified therein and
(c) except as may be indicated in the notes thereto, were prepared in accordance
with GAAP. Access Beyond and Access Beyond Subsidiaries have no material debt,
liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, that is not reflected, reserved
against or disclosed in the Access Beyond Financial Statements, except for those
that may have been incurred after the Access Beyond Balance Sheet Date in the
ordinary course of business, or are not required to be included in a balance
sheet prepared in accordance with GAAP. The inventories of Access Beyond and the
Access Beyond Subsidiaries are of a quality and quantity usable or salable in
the ordinary course of business, the aggregate value of which has been
written-down on the books of said corporations to realizable market value or
with respect to which adequate reserves have been provided in accordance with
GAAP.
3.8 Taxes. Access Beyond and the Access Beyond Subsidiaries have
filed all federal, state, local and foreign tax and material information returns
required to be filed prior to the date hereof, have paid all taxes required to
be paid in respect of all periods prior to the date hereof for which returns
have been filed, have made all necessary estimated tax payments, and have no
liability for taxes in excess of the amount so paid, except to the extent
adequate reserves have been established in the Access Beyond Financial
Statements. True and complete copies of all such tax and information returns
have been provided or made available by Access Beyond to ▇▇▇▇▇. Neither Access
Beyond nor any Access Beyond Subsidiary is delinquent in the payment of any tax
or in the filing of any tax returns, and no deficiencies for any tax have been
threatened,
22
claimed, proposed or assessed which have not been settled or paid. -No tax
return of Access Beyond or any Access Beyond Subsidiary has been audited by the
Internal Revenue Service or any state taxing agency or authority during the past
seven fiscal years or the current fiscal year. For the purposes of this Section
3.8, the terms "tax" and "taxes" shall have the meanings given to those terms in
Section 2.8. Access Beyond has no current or deferred federal income tax
liabilities on a consolidated basis, and will not as a result of the Merger
become liable for any income tax not adequately reserved against on the
Financial Statements. Neither Access Beyond nor any Access Beyond Subsidiary has
filed a consent pursuant to Section 341(f) of the Code.
3.9 Title to Properties. Access Beyond has good and marketable title
to all of its assets as shown on the balance sheet as of the Access Beyond
Balance Sheet Date included in the Access Beyond Financial Statements, free and
clear of all liens, charges or encumbrances (other than for taxes not yet due
and payable and Access Beyond Permitted Liens as defined below), other than such
assets as were sold by Access Beyond in the ordinary course of business since
the Access Beyond Balance Sheet Date or which are subject to capitalized leases.
"Access Beyond Permitted Liens" means any lien, mortgage, encumbrance or
restriction which is reflected in the Access Beyond Financial Statements and is
not in excess of $50,000 and which does not materially detract from the value or
materially interfere with the use, as currently utilized, of the properties
subject thereto or affected thereby or otherwise materially impair the business
operations being conducted thereon. There are no UCC financing statements of
record with the State of Maryland naming Access Beyond as debtor and Access
Beyond neither owns or leases any property in any other state. The machinery and
equipment included in such assets are, in all material respects, in good
condition and repair, normal wear and tear excepted. All leases of real or
personal property to which Access Beyond is a party are fully effective and
afford Access Beyond adequate possession of the subject matter of the lease. To
its knowledge, Access Beyond is not in violation of any material zoning,
building, safety or environmental ordinance, regulation or requirement or other
law or regulation applicable to the operation of owned or leased properties, and
Access Beyond has not received any notice of such violation with which it has
not complied or had waived.
3.10 Absence of Certain Changes. Since the Access Beyond Balance
Sheet Date, Access Beyond and the Access Beyond Subsidiaries have carried on
their business in the ordinary course substantially in accordance with the
procedures and practices in effect on the Access Beyond Balance Sheet Date, and
there has not been with respect to Access Beyond and the Access Beyond
Subsidiaries:
(a) any contingent liability incurred by Access Beyond or any
Access Beyond Subsidiary as guarantor or surety with respect to the
obligations of others;
(b) any mortgage, encumbrance or lien placed on any of the
properties of Access Beyond or any Access Beyond Subsidiary, other than
liens for taxes not yet due and payable and Access Beyond Permitted Liens;
23
(c) any material obligation or liability incurred by Access
Beyond or any Access Beyond Subsidiary other than in the ordinary course
of business,
(d) any purchase or sale or other disposition, or any
agreement or other arrangement for the purchase, sale or other
disposition, of any of the properties or assets of Access Beyond or any
Access Beyond Subsidiary other than in the ordinary course of business or
in amounts that are not material to Access Beyond and the Access Beyond
Subsidiaries or their businesses considered as a whole, except for
disposition of discontinued assets or operations identified in Item
3.10(d) and acquisition of certain technology from Paradyne Corporation;
(e) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties or business
of Access Beyond and the Access Beyond Subsidiaries or their businesses
considered as a whole;
(f) any declaration, setting aside or payment of any dividend
on, or the making of any other distribution in respect of, the capital
stock of Access Beyond, any split, stock dividend, combination or
recapitalization of the capital stock of Access Beyond or any direct or
indirect redemption, purchase or other acquisition by Access Beyond of any
Access Beyond Stock;
(g) any unresolved labor dispute or claim of material unfair
employment or labor practices, any change in the compensation payable, or
to become payable, to any of Access Beyond's or of any Access Beyond
Subsidiaries' officers, employees or agents earning compensation at an
anticipated annual rate in excess of $50,000, or any bonus payment or
arrangement made to or with any of such officers, employees or agents; or
any change in the compensation payable or to become payable to any of
Access Beyond's or of any Access Beyond Subsidiaries' other officers,
employees or agents other than normal annual raises and bonuses in
accordance with past practice, except for "stay-put" bonuses and severance
pay arrangements which do not exceed $600,000 in the aggregate;
(h) any change, not in the ordinary course of business, with
respect to the management, supervisory, development or other key personnel
of Access Beyond (each of whom is listed in Item 3.15) or of any Access
Beyond Subsidiary, except as contemplated by this Agreement and its
Exhibits;
(i) any payment or discharge of a material lien or liability
thereof, which lien or liability was not either (i) shown on the balance
sheet as of the Access Beyond Balance Sheet Date included in the Access
Beyond Financial Statements or (ii) incurred in the ordinary course of
business after the Access Beyond Balance Sheet Date;
(j) any obligation or liability incurred by Access Beyond or
any Access Beyond Subsidiary to any of their officers, directors or
shareholders, or any loans or
24
advances made to any of their officers, directors, shareholders or
affiliates, except normal compensation and expense allowances payable to
officers; or
(k) any material deterioration in the relationship of Access
Beyond or any of the Access Beyond Subsidiaries with any customer or
supplier, which would have a material adverse effect on the businesses of
Access Beyond and the Access Beyond Subsidiaries, taken as a whole.
3.11 Agreements and Commitments. A list of oral or written executory
agreements, obligations or commitments that are material to Access Beyond, any
Access Beyond Subsidiary or their businesses, taken as a whole (the "Access
Beyond Material Agreements"), is included as Item 3.11, true and complete copies
of which have been or will be delivered to ▇▇▇▇▇ or ▇▇▇▇▇' counsel. Each Access
Beyond Material Agreement is valid and in full force and effect. Neither Access
Beyond nor, to the knowledge of Access Beyond, any other party, is in breach of,
or default under, any material term of any such Access Beyond Material
Agreement. Except for the Access Beyond Material Agreements, neither Access
Beyond nor any Access Beyond Subsidiary is a party or subject to any oral or
written executory agreement, obligation or commitment that is material to Access
Beyond, any Access Beyond Subsidiary or their businesses, taken as a whole, that
is not terminable within 60 days without cost or penalty to Access Beyond or any
Access Beyond Subsidiary, including but not limited to the following:
(a) Any contract, commitment, letter agreement, quotation or
purchase order providing for payment by or to Access Beyond or any Access
Beyond Subsidiary of $100,000 or more, or any contract or arrangement that
Access Beyond reasonably believes will have a material adverse effect on
their businesses, taken as a whole;
(b) Any license agreement under which Access Beyond or any
Access Beyond Subsidiary is licensor or licensee (except for any
nonexclusive software license granted by Access Beyond or any Access
Beyond Subsidiary to end-user customers where the form of the license,
excluding standard immaterial deviations, has been provided to ▇▇▇▇▇'
counsel or for standard "shrink wrap" licenses for off-the-shelf software
products);
(c) Any agreement by Access Beyond or any Access Beyond
Subsidiary to encumber, transfer or sell rights in or with respect to any
Access Beyond Intellectual Property (as defined in Section 3.12 hereof);
(d) Any agreement for the sale or lease of real or personal
property involving more than $100,000 per year;
(e) Any dealer, distributor, sales representative, original
equipment manufacturer, value added remarketer or other agreement for the
distribution of any Access Beyond product or the product of any Access
Beyond Subsidiary;
25
(f) Any franchise agreement or financing statement covering a
substantial portion of the assets of Access Beyond and the Access Beyond
Subsidiaries taken as a whole;
(g) Any stock redemption or purchase agreement;
(h) Any joint venture contract or arrangement or any other
agreement that involves a sharing of profits with other persons or the
payment of royalties to any other person;
(i) Any instrument evidencing indebtedness for borrowed money
by way of direct loan, sale of debt securities, purchase money obligation,
conditional sale, guarantee or otherwise, or any advance to any employee
of Access Beyond or any Access Beyond Subsidiary, except for trade
indebtedness incurred in the ordinary course of business or as disclosed
in the Access Beyond Financial Statements; or
(j) Any contract containing covenants purporting to limit
Access Beyond or any Access Beyond Subsidiary's freedom to compete in any
line of business in any geographic area.
3.12 Intellectual Property. Access Beyond and the Access Beyond
Subsidiaries own all right, title and interest in, or have the right to use, all
patent applications, patents, trademark applications, trademarks, service marks,
trade names, copyright applications, copyrights, trade secrets, know-how,
technology and other intellectual property and proprietary rights used in or
reasonably necessary to the conduct of its business as presently conducted and
the business of the development, production, marketing, licensing and sale of
commercial products using such intellectual property and proprietary rights
("Access Beyond Intellectual Property"). Access Beyond and the Access Beyond
Subsidiaries have taken all reasonable measures to protect all Access Beyond
Intellectual Property, and Access Beyond is not aware of any infringement of any
Access Beyond Intellectual Property by any third party. Set forth in Item 3.12
delivered to ▇▇▇▇▇ herewith is a true and complete list of all copyright, mask
work and trademark registrations and applications and all patents and patent
applications for Access Beyond Intellectual Property owned by Access Beyond or
any of the Access Beyond Subsidiaries. Access Beyond is not aware of any
material loss, cancellation, termination or expiration of any such registration
or patent. To Access Beyond's knowledge, the business of Access Beyond and the
Access Beyond Subsidiaries, as conducted as of the date hereof, does not
infringe or violate any of the patents, trademarks, service marks, trade names,
mask works, copyrights, trade secrets, proprietary rights or other intellectual
property of any other person, and neither Access Beyond nor any Access Beyond
Subsidiary has received any written or oral claim or notice of infringement or
potential infringement of the intellectual property of any other person which
could be expected to have a material adverse effect on Access Beyond, and Access
Beyond Subsidiary or their businesses, taken as a whole.
26
3.13 Compliance with Laws. Access Beyond and the Access Beyond
Subsidiaries have complied, or prior to the Closing will have complied, and are
or will be at the Closing, in full compliance in all respects material to Access
Beyond or any Access Beyond Subsidiary with all applicable laws, ordinances,
regulations and rules, and all orders, writs, injunctions, awards, judgments and
decrees, applicable to Access Beyond or any Access Beyond Subsidiary or to the
properties and business of Access Beyond or such subsidiary, including, without
limitation, (a) all applicable federal and state securities laws and
regulations, (b) all applicable federal, state and local laws, ordinances and
regulations, and all orders, writs, injunctions, awards, judgments and decrees,
pertaining to (i) the sale, licensing, leasing, ownership or management of
Access Beyond's or any Access Beyond Subsidiary's owned, leased or licensed real
or personal property, products or technical data, (ii) employment or employment
practices, terms and conditions of employment, or wages and hours or (iii)
safety, health, fire prevention, environmental protection (including toxic waste
disposal and related matters described in Section 3.19 hereof), building
standards, zoning or other similar matters, (c) laws, regulations, rules,
orders, writs, injunctions, judgments or decrees applicable to the export or
re-export of controlled commodities or technical data or (d) the Immigration
Reform and Control Act. Access Beyond and the Access Beyond Subsidiaries have
received all material permits and approvals from, and have made all material
filings with, third parties, including government agencies and authorities, that
are necessary to the conduct of their businesses as presently conducted.
3.14 Certain Transactions and Agreements. No person who is an
officer or director of Access Beyond or any Access Beyond Subsidiary, or a
member of any officer's or director's immediate family, has any direct or
indirect ownership interest in, or any employment or consulting agreement with,
any firm or corporation that competes with Access Beyond or any Access Beyond
Subsidiary (except with respect to any interest in less than 1% of the
outstanding voting shares of any corporation whose stock is publicly traded). No
person who is an officer or director of Access Beyond or any Access Beyond
Subsidiary, or any member of any officer's or director's immediate family, is
directly or indirectly interested in any material contract or informal
arrangement with Access Beyond or any Access Beyond Subsidiary, including, but
not limited to, any loan arrangements, except for compensation for services as
an officer, director or employee of Access Beyond or such subsidiary and except
for the normal rights of a stockholder. None of such officers or directors, the
compensation arrangements for whom are described in Item 3.15, or family members
has any interest in any property, real or personal, tangible or intangible,
including, without limitation, inventions, patents, copyrights, trademarks,
trade names or trade secrets, used in the business of Access Beyond or any
Access Beyond Subsidiary, except for the normal rights of a stockholder.
3.15 Employees.
3.15.1 Identification. A list of all officers, key employees
and key consultants (other than attorneys and accountants) of Access Beyond and
the Access Beyond Subsidiaries and the current compensation and benefits of such
persons as of the date of this Agreement is set forth in Item 3.15. Except as
contemplated by this Agreement, Access Beyond
27
has no knowledge of any facts indicating that any of its key sales or
engineering staff (each of whom is identified in Item 3.15) intends to leave
Access Beyond's or any Access Beyond Subsidiary's employ, provided that Item
3.15 lists any such persons known or expected to be leaving the employ of Access
Beyond within ninety (90) days after the Effective Time.
3.15.2 Contracts. Neither Access Beyond nor any Access Beyond
Subsidiary has any employment contract or consulting agreement currently in
effect that is not terminable at will without penalty or payment of compensation
in excess of that remaining under the contract by Access Beyond or any Access
Beyond Subsidiary (other than agreements with the sole purpose of providing for
the confidentiality of proprietary information or assignment of inventions). All
key engineering staff and consultants of Access Beyond and the Access Beyond
Subsidiaries have executed Access Beyond's standard form of assignments to
Access Beyond and the Access Beyond Subsidiaries of copyright and other
intellectual property rights. To Access Beyond's knowledge, no employee of
Access Beyond or any Access Beyond Subsidiary is in material violation of any
term of any employment contract, nondisclosure agreement or noncompetition
agreement or any restrictive covenant, relating to the right of any such
employee to be employed by Access Beyond or any Access Beyond Subsidiary or to
use trade secrets or proprietary information of others.
3.15.3 Organized Labor. Neither Access Beyond nor any Access
Beyond Subsidiary (a) has been or is now subject to a union organizing effort,
(b) is subject to any collective bargaining agreement with respect to any of its
employees, (c) is subject to any other contract, written or oral, with any trade
or labor union, employees' association or similar organization or (d) has any
labor dispute that has not been resolved.
3.15.4 Identification of Access Beyond Employee Plans. Item
3.15 delivered by Access Beyond to ▇▇▇▇▇ in the Access Beyond Disclosure Letter
contains a list of all employment and consulting agreements, pension,
retirement, disability, medical, dental or other health plans, life insurance or
other death benefit plans, profit sharing, deferred compensation agreements,
stock, option, bonus or other incentive plans, vacation, sick, holiday or other
paid leave plans, severance plans or other similar employee benefit plans
maintained by Access Beyond or any of the Access Beyond Subsidiaries (the
"Access Beyond Employee Plans"), including without limitation all "employee
benefit plans" as defined in Section 3(3) of ERISA. Access Beyond has delivered
true and complete copies or descriptions of all the Access Beyond Employee Plans
to ▇▇▇▇▇ and ▇▇▇▇▇' counsel.
3.15.5 Conduct of Access Beyond Employee Plans. All
contributions due from Access Beyond or any Access Beyond Subsidiary with
respect to any of the Access Beyond Employee Plans have been made or accrued on
Access Beyond's financial statements, and no further contributions will be due
or will have accrued thereunder as of the Closing. Each of the Access Beyond
Employee Plans, and its operation and administration, is, in all material
respects, in compliance with all applicable, federal, state, local and other
governmental laws and ordinances, orders, rules and regulations, including the
requirements of ERISA and the Code. All
28
such Access Beyond Employee Plans that are "employee pension benefit plans" (as
defined in Section 3(2) of ERISA) which are intended to qualify under Section
401 (a)(8) of the Code have received favorable determination letters that such
plans satisfy the qualification requirements of the Tax Equity and Fiscal
Responsibility Act of 1982, the Deficit Reduction Act of 1984 and the Retirement
Equity Act of 1984. In addition, neither Access Beyond nor any Access Beyond
Subsidiary has been a participant in any "prohibited transaction," within the
meaning of Section 406 of ERISA with respect to any employee pension benefit
plan (as defined in Section 3(2) of ERISA) which Access Beyond or any Access
Beyond Subsidiary sponsors as employer or in which Access Beyond or any Access
Beyond Subsidiary participates as an employer, which was not otherwise exempt
pursuant to Section 408 of ERISA (including any individual exemption granted
under Section 408(a) of ERISA), or which could result in an excise tax under the
Code. The group health plans, as defined in Section 4980B(g) of the Code, that
benefit employees of Access Beyond any the Access Beyond Subsidiaries are in
material compliance with the continuation coverage requirements of subsection
4980B of the Code. There are no outstanding violations of Section 4980B of the
Code with respect to any Access Beyond Employee Plan, covered employees or
qualified beneficiaries.
3.15.6 Effect of Agreement. Neither Access Beyond nor any
Access Beyond Subsidiary is a party to any agreement with any executive officer
or other key employee (a) the benefits of which are contingent, or the terms of
which are materially altered, upon the occurrence of a transaction involving
Access Beyond in the nature of any of the transactions contemplated by this
Agreement, (b) providing any term of employment or compensation guarantee or (c)
providing severance benefits or other benefits after the termination of
employment of such employee, other than Access Beyond's contract with ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ which provides for certain compensation contingent upon completion of a
transaction such as the transaction contemplated hereby. Neither Access Beyond
nor any Access Beyond Subsidiary is a Party to any agreement or plan, including,
without limitation, any stock option plan, stock appreciation rights plan or
stock purchase plan, (a) any of the benefits of which will be materially
increased, or the vesting of benefits of which will be materially accelerated,
by the occurrence of any of the transactions contemplated by this Agreement,
except as provided in the Access Beyond Plans, or (b) the value of any of the
benefits of which will be calculated on the basis of any of the transactions
contemplated by this Agreement. Neither Access Beyond nor any Access Beyond
Subsidiary is obligated to make any excess parachute payment, as defined in
Section 280G(b)(1) of the Code, nor will any excess parachute payment be deemed
to have occurred as a result of or arising out of the Merger to the extent
Section 280G of the Code is applicable to Access Beyond or any Access Beyond
Subsidiary.
3.16 Corporate Documents. Access Beyond will make available to ▇▇▇▇▇
for examination all documents and information listed in the Access Beyond
Disclosure Letter that are requested by ▇▇▇▇▇' legal counsel, including, without
limitation, the following: (a) copies of Access Beyond's and each Access Beyond
Subsidiary's Agreement of Incorporation and Bylaws as currently in effect; (b)
Access Beyond's and each Access Beyond Subsidiary's minute book containing all
records of all proceedings, consents, actions and meetings of their directors
and
29
shareholders; (c) stock records reflecting all stock issuances and transfers of
the securities of Access Beyond and the Access Beyond Subsidiaries; and (d) all
permits, orders and consents issued by any regulatory agency with respect to
Access Beyond or any Access Beyond Subsidiary, or any securities of Access
Beyond or any Access Beyond Subsidiary, and all applications for such permits,
orders and consents.
3.17 Books and Records. The books, records and accounts of Access
Beyond and each Access Beyond Subsidiary (a) are in all material respects true
and complete, (b) have been maintained in accordance with reasonable business
practices on a basis consistent with prior years, (c) are stated in reasonable
detail and accurately and fairly reflect the transactions and dispositions of
the assets of Access Beyond and such subsidiary and (d) accurately and fairly
reflect the basis for the Access Beyond Financial Statements.
3.18 Insurance. Access Beyond and the Access Beyond Subsidiaries
maintain fire and casualty, workers compensation and general liability insurance
as listed in Item 3.18.
3.19 Environmental Matters. During the period that Access Beyond or
any Access Beyond Subsidiary has leased the premises currently occupied by it
and those premises occupied by it since the date of its incorporation, there
have been no disposals, releases or threatened releases by Access Beyond or any
Access Beyond Subsidiary of Hazardous Materials on any such premises that would
have a material adverse effect upon Access Beyond, any Access Beyond Subsidiary
or any of their businesses. Access Beyond has no knowledge of any presence,
disposals, releases or threatened releases of Hazardous Materials on or from any
of such premises, which may have occurred prior to Access Beyond or any Access
Beyond Subsidiary having taken possession of any of such premises that would
have a material adverse effect upon Access Beyond, any Access Beyond Subsidiary
or any of their businesses.
3.20 Government Contracts. All representations, certifications and
disclosures made by Access Beyond or any Access Beyond Subsidiary to any
Government Contract Party (as defined in Section 2.20 above) have been in all
material respects current, complete and accurate at the times they were made.
There have been no acts, omissions or noncompliance with regard to any
applicable public contracting statute, regulation or contract requirement
(whether express or incorporated by reference) relating to any of Access
Beyond's or any Access Beyond Subsidiary's contracts with any Government
Contract Party in either case that have led to or could lead to, either before
or after the Closing, (a) any claim or dispute involving Access Beyond or any
Access Beyond Subsidiary and any Government Contract Party or (b) any
suspension, debarment, contract renegotiation or contract termination, or
proceeding related thereto. There has been no act or omission that relates to
the marketing, licensing or selling to any Government Contract Party of any of
Access Beyond's or any Access Beyond Subsidiary's technical data and computer
software and that has led to or could lead to, either before or after the
Closing, any material cloud on any of Access Beyond's or any Access Beyond
Subsidiary's rights in and to its technical data and computer software. All of
Access Beyond's and the Access Beyond
30
Subsidiaries' development of technical data and computer software was developed
exclusively at private expense.
3.21 Remote Access Products. Development of the remote access
products designated as Access Beyond 1000, Access Beyond 3400, Access Beyond
4400 and Hawk Access Products, including eight (8) analogue modem, six (6) BRI
SDN, 16 port asynch, twelve (12) digital modem card and T1 link module have
passed Access Beyond's quality testing and are ready to be manufactured in
volume production.
3.22 No Brokers. Neither Access Beyond nor any of the Access Beyond
Subsidiaries is obligated for the payment of fees or expenses of any investment
banker, broker or finder, other than ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities
Corporation, in connection with the origin, negotiation or execution of this
Agreement or In connection with any transaction provided for herein.
3.23 Information Supplied. None of the information supplied or to be
supplied by Access Beyond for inclusion in the Form S-4 and the Prospectus/Proxy
Statement, at the date such information is supplied and at the time of the
meetings of the ▇▇▇▇▇ shareholders and the Access Beyond stockholders to be held
to approve the Merger, contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading, or will, in the
case of the Form S-4, at the time the Form S-4 becomes effective under the
Securities Act, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading.
3.24 Interested Party Transactions. Except as set forth in Item
3.24, no officer or director of Access Beyond or any Access Beyond Subsidiary or
any "affiliate" or "associate" (as those terms are defined in Rule 405
promulgated under the Securities Act) of any such person has had, either
directory or indirectly, a material interest in: (a) any person or entity which
purchases from or sells, licenses or furnishes to Access Beyond or any Access
Beyond Subsidiary any goods, property, technology or intellectual or other
property rights or services; or (b) any contract or agreement to which Access
Beyond or any Access Beyond Subsidiary is a party or by which it may be bound or
affected.
3.25 Disclosure. This Agreement, its exhibits and schedules, and any
of the certificates or documents to be delivered by Access Beyond to ▇▇▇▇▇ under
this Agreement, taken together, do not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which such statements were made, not misleading.
31
3.26 SEC Filings. Access Beyond has timely filed all reports,
filings and other documents required to be filed with the SEC under the
Securities Act of 1933 and the Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.
4. COVENANTS OF THE PARTIES.
4.1 Access; Advice of Changes. During the period from the date of
this Agreement until the Effective Time (unless this Agreement is earlier
terminated in accordance herewith), each Party covenants to and agrees with the
other Party as follows.
4.1.1 Access to Information. Until the Closing and subject to
the terms and conditions hereof or in any other agreement between the Parties
relating to the confidentiality and use of confidential and proprietary
information, each Party will provide the other and the other's agents with
reasonable access to the files, books, records and offices of the Party making
the covenant (the "Promising Party"), including any and all information relating
to such Party's taxes, commitments, contracts, leases, licenses, real, personal
and intangible property, and financial condition.
4.1.2 Discussions with Customers and Suppliers. Through the
Due Diligence Period (as defined in Section 7.1), each Party will be entitled to
hold meetings and discussions with material customers and suppliers of the other
Party in order to determine any business issues that may exist concerning the
customer's or supplier's relationship with the other Party. Prior to holding any
such discussion, the other Party shall be given at least 24 hours notice of the
pendency of and given a reasonable opportunity to be present at the same. Such
notice will specify the persons to be present and the nature of the discussions
to be held. No such discussions may be held after the expiration of the Due
Diligence Period without the prior written consent of the other Party, which
consent may not be unreasonably withheld or delayed.
4.1.3 Notification of Changes. Each Party will promptly advise
the other Party in writing (a) of any event occurring subsequent to the date of
this Agreement that would render any representation or warranty of such Party
contained in this Agreement, if and to the extent required to be made at the
Closing, untrue or inaccurate in any material respect and (b) of any material
action, suit, proceeding or investigation by or before any court, board or
governmental agency, initiated by or against such Party or any of its
subsidiaries or known by such Party to be threatened against it or any
subsidiary. The Promising Party hereby agrees to deliver to the other Party
within 30 days after the end of each monthly accounting period ending after the
date of this Agreement and before the Closing, an unaudited balance sheet and
statement of operations, which financial statements shall be prepared in the
ordinary course of business consistent with past practice, in accordance with
the Promising Party's books and records and generally accepted accounting
principles and shall fairly present the financial position of the Promising
Party and its subsidiaries as of their respective dates and the results of the
Promising Party's and its subsidiaries' operations for the periods then ended.
32
4.2 Notification of Changes in Relationships. If the Promising Party
becomes aware of a material deterioration in the relationship with any material
customer, supplier or key employee of the Promising Party, such Party will
promptly bring such information to the attention of the other Party in writing
and, if requested by the other Party, will exert all reasonable efforts to
restore the relationship.
4.3 Conduct of Business. During the period from the date of this
Agreement until the Effective Time, unless earlier terminated, each Promising
Party (including, without limitation, Newco) covenants to and agrees with the
other Party that, except as provided otherwise herein or as approved or
recommended by the other Party, prior to the Effective Time each Promising Party
indicated below (which for purposes of this Section 4.3 will include the
subsidiaries of such Party) will not, without the prior written consent of an
officer of the other Party, such consent not to be unreasonably withheld or
delayed:
(a) Enter into any transaction not in the ordinary course of
business or enter into any transaction or make any commitment involving a
capital expenditure in excess of $100,000 with respect to Access Beyond,
$10,000 with respect to Newco and $5,000,000 with respect to ▇▇▇▇▇;
(b) Borrow any money or encumber or permit to be encumbered
any of its assets except in the ordinary course of its business consistent
with past practice and to an extent that is not material to the Promising
Party or its business, provided that Access Beyond may establish a credit
facility with Signet Bank or any other institutional lender prior to the
Effective Time in the approximate amount of $3.0 million and may grant
security interests in all or substantially all of its assets in connection
therewith, and Access Beyond shall not agree to any prepayment fees or
penalties in excess of $100,000 in connection therewith without ▇▇▇▇▇'
prior consent;
(c) Dispose of any of its material assets except in the
ordinary course of business consistent with past practice and to an extent
that is not material to the Promising Party or its business;
(d) Enter into any material agreement of the types described
in Section 3.11, except in the ordinary course of business consistent with
past practice without the consent of ▇▇▇▇▇;
(e) Fail to maintain its equipment and other assets that are
material to the operation of its business in good working condition and
repair according to the standards it has maintained to the date of this
Agreement, subject only to ordinary wear and tear;
(f) Except as contemplated by this Agreement and for severance
and "stay put" bonuses, pay any bonus, royalty, increased salary (except
for annual increases
33
in the ordinary course of business consistent with past practice) or
special remuneration to any officer, employee or consultant (except
pursuant to existing arrangements previously disclosed in writing to the
other Party or in connection with the transactions contemplated hereby) or
enter into any new employment or consulting agreement with any such
person, or enter into any new agreement or plan of the type described in
Section 2.15.4 or Section 3.15.4, as the case may be;
(g) Change accounting methods, unless required by generally
accepted accounting principles;
(h) Declare, set aside or pay any cash or stock dividend or
other distribution in respect of capital stock, or except as necessary to
redeem any or all of the issued and outstanding shares of ▇▇▇▇▇ Series B
Preferred Stock, redeem or otherwise acquire any of its capital stock;
(i) Amend or terminate any Material Agreements to which Access
Beyond is a Party, except those amended or terminated in the ordinary
course of business consistent with past practice;
(j) Lend any amount to any person or entity, other than
advances for travel and expenses which are incurred in the ordinary course
of business consistent with past practice, which travel and expenses shall
be documented by receipts for the claimed amounts;
(k) Guarantee or act as a surety for any obligation, except
for the endorsement of checks and other negotiable instruments in the
ordinary course of business consistent with past practice;
(l) Waive or release any material right or claim, except in
the ordinary course of business consistent with past practice;
(m) Split or combine the outstanding shares of its capital
stock of any class or enter into any recapitalization affecting the number
of outstanding shares of its capital stock of any class or affecting any
other of its securities;
(n) Except for the Merger, merge, consolidate or reorganize
with, or acquire the business, stock or assets of any entity, provided
that ▇▇▇▇▇ may enter into any merger or acquisition with any party in
which the amount of the transaction consideration does not exceed $10.0
million, provided that no such transaction will be entered into by ▇▇▇▇▇
in which the percentage of shares of Access Beyond issuable to or retained
by the shareholders of either Party, as the case may be, immediately after
the Effective Time, would be affected, without the consent of Access
Beyond; and no such transaction will be
34
entered into by either Party after filing the S-4 as contemplated in
Section 4.5 until the earlier of the Effective Time or termination of this
Agreement.
(o) Amend its Articles of Incorporation or Bylaws, except as
contemplated by, and in accordance with, this Agreement;
(p) Agree to any audit assessment by any tax authority or file
any federal or state income or franchise tax return unless copies of such
returns have been delivered to the other Party for its review prior to
filing;
(q) License any Access Beyond or ▇▇▇▇▇ Intellectual Property,
as the case may be, except in the ordinary course of business consistent
with past practice;
(r) Terminate the employment of any, officer, director or key
employee listed in Item 2.15 with respect to ▇▇▇▇▇ or Item 3.15 with
respect to Access Beyond, as the case may be;
(s) Agree to do any of the things described in the preceding
clauses 4.3(a) through 4.3(r);
(t) File a Registration Statement with the SEC, other than a
Form S-8 in respect of the Access Beyond Plans, or become subject to the
1934 Securities Exchange Act by directly or indirectly merging with or
acquiring an entity which is a reporting company; or
(u) Nothing herein shall prohibit ▇▇▇▇▇ or other parties from
entering into the agreements referred to herein as Exhibits C-2 through
C-5, the Chestnut Capital Limited Partnership Pledge Agreement, amendment
to the Notes referred to in Section 5.3.1 hereof, or any other agreements
expressly set forth as a condition or covenant to be performed by ▇▇▇▇▇.
4.4 No Solicitation.
4.4.1 General Prohibition. Subject to Section 4.4.2, neither
of the Parties hereto shall directly or indirectly, nor shall either Party
authorize or permit any subsidiary of such Party (a Party and its subsidiaries
being collectively referred to as a "Party") or any representative of such Party
directly or indirectly to, (a) solicit, initiate, encourage or induce the
making, submission or announcement of any offer or proposal (other than an offer
or proposal by the other Party hereto) contemplating or otherwise relating to
any "Acquisition Transaction" (an "Acquisition Proposal"), or take any action
that could reasonably be expected to lead to an Acquisition Proposal, (b)
furnish any nonpublic information regarding such Party to any person or entity
(each, a "Person") in connection with, or in response to, an Acquisition
Proposal, (c) engage in discussions with any Person with respect to any
Acquisition Proposal, (d) approve, endorse or recommend any Acquisition Proposal
or (e) enter into any letter of intent or similar
35
document or any agreement contemplating or otherwise relating to any Acquisition
Transaction. As of the date of this Agreement, each Party shall immediately
cease and cause to be terminated any existing discussions with any other Person
that relate to any Acquisition Proposal.
4.4.2 Exceptions. Notwithstanding anything to the contrary
contained in this Agreement, this Section 4.4 shall not prohibit such Party from
taking any action described in clauses (c), (d) and (e) of Section 4.4.1 in
response to an unsolicited bona fide written Acquisition Proposal submitted (and
not withdrawn) by such Person if (a) the Board of Directors of such Party
concludes in good faith, based upon the written advice of its financial advisor,
that such Acquisition Proposal could reasonably be expected to result in a
transaction that is more favorable from a financial point of view to such
Party's stockholders than the Merger, (b) the Board of Directors of such Party
concludes in good faith, after consultation with, and the receipt of written
advice from, outside legal counsel, that such action is required in order for
the Board of Directors of such Party to comply with its fiduciary obligations to
such Party's stockholders under applicable law, (c) prior to furnishing any such
nonpublic information to, or entering into discussions with, such Person, such
Party gives the other Party written notice of the identity of such Person and of
such Party's intention to furnish nonpublic information to, or enter into
discussions with, such Person, and such Party receives from such Person an
executed confidentiality agreement containing customary limitations on the use
and disclosure of all nonpublic written and oral information furnished to such
Person by or on behalf of such Party, and (d) prior to furnishing any such
nonpublic information to such Person, such Party furnishes such nonpublic
information to the other Party (to the extent such nonpublic information has not
been previously furnished by such Party to the other Party).
4.4.3 Definition of Acquisition Transaction. "Acquisition
Transaction" shall mean any transaction or series of related transactions
involving:
(a) any merger, consolidation, share exchange, business
combination, issuance of securities, acquisition of securities, tender
offer, exchange offer or other similar transaction) in which (i) the Party
is a constituent corporation, (ii) a Person or "group" (as defined in the
Exchange Act and the rules promulgated thereunder) of Persons directly or
indirectly acquires such Party or more than 50% of such Party's business
or, directly or indirectly, acquires beneficial or record ownership of
securities representing more than 50% of the outstanding securities of any
class of voting securities of such Party, or (iii) in which such Party
issues securities representing more than 50% of the outstanding securities
of any class of voting securities of such Party; or
(b) any sale, lease (other than in the ordinary course
of business), exchange, transfer, license (other than in the ordinary
course of business) or disposition of more than 50% of the assets of the
Party.
4.5 Registration on Form S-4. The Access Beyond Stock to be issued
in the Merger shall be registered under the Securities Act on Form S-4. As
promptly as practicable after
36
the date of this Agreement, Access Beyond and ▇▇▇▇▇ shall prepare and file with
the SEC a Form S-4 registration statement (the "Form S-4") together with the
prospectus/proxy statement included therein (the "Prospectus/Proxy Statement")
and any other documents required by the Securities Act or the Exchange Act in
connection with the Merger.
4.5.1 Filing of Form S-4 and Amendments. Access Beyond and
▇▇▇▇▇ shall use reasonable, diligent efforts to cause the Form S-4 (including
the Prospectus/Proxy Statement) to comply with the rules and regulations
promulgated by the SEC, to respond promptly to any comments of the SEC or its
staff and to have the Form S-4 declared effective under the Securities Act as
promptly as practicable after it is filed with the SEC. ▇▇▇▇▇ shall promptly
furnish to Access Beyond all information concerning ▇▇▇▇▇, ▇▇▇▇▇' Subsidiaries
and such ▇▇▇▇▇' shareholders that may be required or reasonably requested in
connection with any action contemplated by this Section 4.5. If any event
relating to any of ▇▇▇▇▇ or any ▇▇▇▇▇ Subsidiary occurs, or if ▇▇▇▇▇ becomes
aware of any information, that should be set forth in an amendment or supplement
to the Form S-4 or the Prospectus/Proxy Statement, then ▇▇▇▇▇ shall promptly
inform Access Beyond thereof, shall cooperate with Access Beyond in filing such
amendment or supplement with the SEC and, if appropriate, in mailing such
amendment or supplement to the shareholders of ▇▇▇▇▇. Any opinion required to be
given in connection with the Form S-4 with respect to the tax consequences of
the Merger as they relate to the ▇▇▇▇▇ Shareholders shall be provided by ▇▇▇▇▇'
accountants or counsel.
4.5.2 Other Regulatory Approvals. Prior to the Effective Time,
Access Beyond shall use reasonable, diligent efforts to obtain all regulatory
approvals needed to ensure that the Access Beyond Stock to be issued in the
Merger will be registered or qualified under the securities law, or exempt from
the same, of every jurisdiction of the United States in which any holder of the
▇▇▇▇▇ Stock has an address of record on the record date for determining the
shareholders entitled to notice of, and to vote at, the ▇▇▇▇▇ Shareholders
Meeting described below. ▇▇▇▇▇ shall use reasonable, diligent efforts to assist
Access Beyond to the extent necessary to comply with the securities and Blue Sky
laws of all applicable jurisdictions in connection with the Merger.
4.6 Regulatory Approvals. Each of Access Beyond and ▇▇▇▇▇ shall use
reasonable, diligent efforts to file, as soon as practicable after the date of
this Agreement, all notices, reports and other documents required to be filed
with any governmental body or agency with respect to the Merger and the other
transactions contemplated by this Agreement, and to submit promptly any
additional information requested by any such governmental body or agency.
Without limiting the generality of the foregoing, Access Beyond and ▇▇▇▇▇ shall,
promptly after the date of this Agreement, prepare and file the notifications
required under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act (the "HSR Act")
in connection with the Merger. Access Beyond and ▇▇▇▇▇ shall respond as promptly
as practicable to (a) any inquiries or requests received from the Federal Trade
Commission or the Department of Justice for additional information or
documentation and (b) any inquiries or requests received from any state attorney
general or other governmental body or agency in connection with antitrust or
related matters. Each of the Parties
37
hereto shall (a) give the other Party prompt notice of the commencement of any
action, suit, arbitration, proceeding, hearing, audit or active investigation
commenced, conducted or heard by or before, any court or other governmental body
or agency (each a "Legal Proceeding ) with respect to the Merger or any of the
other transactions contemplated by this Agreement, (b) keep the other Party
informed as to the status of any such Legal Proceeding, and (c) promptly inform
the other Party of any communication to or from the Federal Trade Commission,
the Department of Justice or any other governmental body or agency regarding the
Merger. The Parties will consult and cooperate with one another, and will
consider in good faith the views of one another, in connection with any
analysis, appearance, presentation, memorandum, brief, argument, opinion or
proposal made or submitted in connection with any Legal Proceeding under or
relating to the HSR Act or any other federal or state antitrust or fair act law.
In addition, except as may be prohibited by any governmental body or agency or
by any legal requirement, in connection with any Legal Proceeding under or
relating to the HSR Act or any other federal or state antitrust or fair trade
law or any other similar Legal Proceeding, each of the Parties hereto agrees to
permit authorized representatives of the other Party to be present at each
meeting or conference relating to any such Legal Proceeding and to have access
to, and be consulted in connection with, any document, opinion or proposal made
or submitted to any governmental body or agency in connection with any such
Legal Proceeding.
4.7 Stockholders Meetings.
4.7.1 Convening Meetings. Each Party hereto shall, and Access
Beyond will cause Newco to, take all action necessary under all applicable legal
requirements to call, give notice of, convene and hold a meeting of the holders
of such Party's voting securities to consider, act upon and vote upon the
adoption of this Agreement and approval of the Merger and the transactions
contemplated thereby, including without limitation, approving the Amended and
Restated Charter of Access Beyond, approving the Access Beyond Series A Stock,
voting on new director nominees to the Access Beyond Board, and changing the
name of Access Beyond to "▇▇▇▇▇ Communications Inc." (as to Access Beyond, the
"Access Beyond Stockholders Meeting," as to ▇▇▇▇▇, the "▇▇▇▇▇ Shareholders
Meeting" and, as to both of such meetings, the "Stockholders Meeting"). Each
Party's Stockholders Meeting and the stockholder meeting of Newco will be held
as promptly as practicable and in any event Access Beyond shall hold its
Stockholders Meeting within 60 days and ▇▇▇▇▇ shall hold the ▇▇▇▇▇ Shareholders
Meeting within ten (10) business days after the Form S-4 is declared effective
by the SEC. Each Promising Party, including, without limitation, Newco, shall
ensure such Parties' Stockholders Meeting is called, noticed, convened, held and
conducted, and that all proxies solicited in connection with such Party's
Stockholders Meeting are solicited, in compliance with all applicable legal
requirements.
4.7.2 Approval Recommendation. Subject to Sections 4.7.3 and
4.7.4 below: (a) the Board of Directors of each Promising Party, including
without limitation Newco, shall unanimously recommend that such Party's
stockholders vote in favor of and adopt and approve this Agreement and the
Merger at such Party's Stockholders Meeting; (b) the Prospectus/Proxy Statement
shall include a statement to the effect that the Board of Directors of
38
such Party has unanimously recommended that such Party's stockholders vote in
favor of and adopt and approve this Agreement and the Merger at such Party's
Stockholders Meeting; and (c) neither the Board of Directors of such Party nor
any committee thereof shall withdraw, amend or modify, or propose or resolve to
withdraw, amend or modify, in a manner adverse to the other Party, the unanimous
recommendation of the Board of Directors of the Promising Party that such
Party's stockholders vote in favor or and adopt and approve this Agreement and
the Merger.
4.7.3 Withdrawal or Amendment of Recommendation. Nothing in
clause (d) of Section 4.4.1 or in Section 4.7.2 shall prevent the Board of
Directors of the Promising Party from withdrawing, amending or modifying its
unanimous recommendation in favor of the Merger if (a) an unsolicited bona fide
written Acquisition Proposal is submitted to such Party and is not withdrawn,
(b) the Board of Directors of such Party concludes in good faith, based upon the
written advice of its financial advisor, that such Acquisition Proposal could
reasonably be expected to result in a transaction that is more favorable from a
financial point of view to such Party's stockholders than the Merger, (c)
neither the Promising Party nor any of its representatives shall have violated
any of the restrictions set forth in Section 4.4.1 and (d) the Board of
Directors of such Party concludes in good faith, after consultation with, and
the receipt of written advice from, outside legal counsel, that the withdrawal,
amendment or modification of such recommendation is required in order for the
Board of Directors of such Party to comply with its fiduciary obligations to
such Party's stockholders under applicable law.
4.7.4 Recommendation as to Other Offer. Nothing in clause
"(d)" of Section 4.4.1 or in Section 4.7.2 shall prevent the Board of Directors
of the Promising Party from recommending that its stockholders accept an
unsolicited Acquisition Proposal if (a) the Board of Directors of such Party
shall have withdrawn, amended or modified its recommendation in favor of the
Merger in accordance with and as permitted by Section 4.7.3, (b) the Board of
Directors of such Party shall have concluded in good faith, based upon the
written advice of its financial advisor, that such Acquisition Proposal is more
favorable from a financial point of view to such Party's stockholders than the
Merger, (c) neither the Promising Party nor any of its representatives shall
have violated any of the restrictions set forth in Section 4.4.1, and (d) the
Board of Directors of such Party shall have concluded in good faith, after
consultation with, and the receipt of written advice from, its outside legal
counsel, that the recommendation in favor of acceptance of such tender offer or
exchange offer is required in order for the Board of Directors of such Party to
comply with its fiduciary obligations to such Party's stockholders under
applicable law.
4.8 Indemnification of Officers and Directors.
4.8.1 Maintenance of Rights. All rights to indemnification
existing in favor of the current directors and officers of each Party for acts
and omissions occurring prior to the Effective Time, as provided in each Party's
Articles or Certificate of Incorporation and/or Bylaws (as in effect as of the
date of this Agreement) and as provided in the indemnification agreements
between such Party and said directors and officers (as in effect as of the date
of this Agreement), shall survive the Merger and shall be maintained by Access
Beyond and ▇▇▇▇▇, as
39
the surviving corporation in the Merger, for a period of not less than six years
from the Effective Time.
4.8.2 Maintenance of Insurance. From the Effective Time until
the sixth anniversary of the date on which the Merger becomes effective, Access
Beyond shall maintain in effect, for the benefit of the current directors and
officers of the Parties with respect to acts or omissions occurring prior to the
Effective Time, the directors' and officers' liability insurance policy
currently carried; provided, however, that Access Beyond may substitute for such
policy a policy or policies of comparable coverage.
4.9 Confidentiality. The Mutual Confidentiality and Nondisclosure
Agreement, dated May 5, 1997, between the Parties hereto will remain in full
force and effect from the date hereof through the Effective Time.
4.10 Confidentiality and Disclosure. Neither Party shall, nor shall
permit any of its representatives to, issue any press release or otherwise
publicly disseminate any document or other written material relating to the
Merger or any of the other transactions contemplated by this Agreement unless
(a) each Party shall have approved such press release or written material (it
being understood that neither Party shall unreasonably withhold or delay its
approval of any such press release or written material), or (b) Access Beyond
shall have been advised by its outside legal counsel that the issuance of such
press release or the dissemination of such written material is required by any
applicable law or regulation, and Access Beyond shall have consulted with ▇▇▇▇▇
and shall have used its best efforts to modify such release so that it is
reasonably acceptable to ▇▇▇▇▇ prior to issuing such press release or
disseminating such written material; provided, however, that Access Beyond shall
be entitled to file with the SEC, after the execution and delivery of this
Agreement, a report on Form 8-K (together with a copy of this Agreement
(including the exhibits hereto) and the press release (all of which shall have
been approved by ▇▇▇▇▇) announcing this Agreement. Each Party shall use
reasonable, diligent efforts to ensure that none of its representatives makes
any public statement, whether oral or written, that is materially inconsistent
with any press release issued or any written material approved in advance by
▇▇▇▇▇ and Access Beyond and publicly disseminated by Access Beyond or ▇▇▇▇▇ with
respect to the Merger or with respect to any of the other transactions
contemplated by this Agreement. ▇▇▇▇▇ will take all reasonable precautions to
prevent any trading in the securities of Access Beyond by officers, directors,
employees and agents of ▇▇▇▇▇ having knowledge of any material information
regarding Access Beyond provided hereunder, or any disclosure by any such
persons to anyone outside of Access Beyond or ▇▇▇▇▇ of any material non-public
information concerning Access Beyond, any Access Beyond Subsidiary or the
transactions contemplated by this Agreement, until the information in question
has been adequately and publicly disclosed.
4.11 Affiliate Agreements. To ensure that the issuance of Access
Beyond Stock in the Merger complies with the Securities Act, concurrently with
the execution of this Agreement ▇▇▇▇▇ will deliver to Access Beyond a letter
identifying all persons who are, in ▇▇▇▇▇' reasonable judgment, "affiliates" of
▇▇▇▇▇ (for purposes of Rule 145 promulgated under the Securities Act)
40
at the time this Agreement is executed. ▇▇▇▇▇ will provide Access Beyond with
all information and documents needed to evaluate this list for compliance with
securities laws. Concurrent with the execution of this Agreement, ▇▇▇▇▇ will
cause each of its affiliates to deliver to Access Beyond, written agreements
(the "▇▇▇▇▇ Affiliate Agreements") in the form of Exhibit C-3, providing, among
other things, that such persons will not offer to sell, sell or otherwise
dispose of any of the Access Beyond Stock issued to such person in the Merger in
violation of the Securities Act and Rule 145 promulgated thereunder, as they may
be amended from time to time, and will make no disposition of Access Beyond
Stock for certain periods of time after the Effective Time.
4.12 New Capital Funding. Both ▇▇▇▇▇ and Access Beyond shall make
diligent efforts to obtain equity capital for Access Beyond or ▇▇▇▇▇ prior to or
after the Merger in the aggregate amount of up to $35.0 million. In the event
either Party is successful in obtaining such additional capital, then each Party
agrees that it will be proportionately diluted by the new stock required to be
issued or issuable to any new investor, and that the respective percentages of
the shares of Access Beyond to be held immediately after the Effective Time by
the Access Beyond and ▇▇▇▇▇ shareholders as contemplated by Section 1.1.5 shall
be appropriately adjusted to accommodate the dilution occasioned by the new
capital funding. No binding contract for such new capital funding prior to the
Effective Time shall be entered into without the consent of the other Party,
which shall not be unreasonably withheld. The Parties acknowledge that ▇▇▇▇▇ has
entered into a commitment letter with respect to the issuance of $30 million in
capital stock dated July 16, 1997, and agree that the consummation of the
transaction described therein and as approved by Access Beyond by letter of even
date herewith shall not be deemed a breach of any representation, warranty or
covenant herein on the part of ▇▇▇▇▇.
4.13 Other Actions Required. During the period from the date of this
Agreement until the Effective Time or earlier termination of this Agreement in
accordance herewith, each Party covenants to, and agrees with, the other to use
reasonable, diligent efforts to satisfy or cause to be satisfied all the
conditions precedent which are set forth in Section 7 or 8 as to such Party, as
the case may be, and to cause the transactions provided for in this Agreement to
be consummated, and, without limiting the generality of the foregoing, to use
reasonable, diligent efforts to obtain all consents and authorizations of third
parties and to make all filings with, and give all notices to, third parties
that may be necessary or reasonably required on its part in order to effect the
transactions provided for herein.
5. ▇▇▇▇▇ PRECLOSING COVENANTS.
5.1 Business Plan. By the end of the Due Diligence Period, ▇▇▇▇▇
will prepare a proposed "high level" business plan for the combination of the
two companies. The business plan will be prepared with input from Access Beyond
and will be constructed in such a manner that indicates ongoing operating
profitability within the year following the Closing of the Merger, with
reasonable contingencies. The business plan may be modified following the
Closing.
41
5.2 ▇▇▇▇▇ Dissenting Shares. As promptly as practicable after the
date of the ▇▇▇▇▇ Shareholders Meeting and prior to the Closing Date, ▇▇▇▇▇
shall furnish Access Beyond with the name and address of each ▇▇▇▇▇ dissenting
shareholder, if any, and the number of ▇▇▇▇▇ Dissenting Shares owned by such
▇▇▇▇▇ dissenting shareholders.
5.3 Other Actions Required. ▇▇▇▇▇ shall use reasonable, diligent
efforts to cause the following to occur:
5.3.1 Convertible Debt. Effective upon the Effective Time,
with an appropriate agreement to be signed at or prior to the expiration of the
Due Diligence Period, the Convertible Subordinated Promissory Notes in favor of
Rinzai Limited, Kaifa Technology (H.K.) Limited, Rolling Profit Holdings, Ltd.,
Lao Hotel (H.K.) Limited, Saliendra Pte. Ltd. and S.P. Quek Investments Ltd.
issued by ▇▇▇▇▇ in 1996 and 1997 (the "Notes") shall be converted to ▇▇▇▇▇
Common Stock or amended to terminate the convertibility feature of the Notes and
to adjust the repayment (after Closing of the Merger) by ▇▇▇▇▇ or Access Beyond
of the Notes to occur only upon a determination of the Board of Access Beyond,
in the exercise of its fiduciary duties, that sufficient cash flow is available
to make such repayment, in whole or in part.
5.3.2 Antidilution Warrant. Termination of that certain
Warrant to Purchase Stock issued to Rinzai Limited by ▇▇▇▇▇ on April 16, 1996
(the "Antidilution Warrant") shall be executed at or prior to the expiration of
the Due Diligence Period, effective upon the Effective Time.
5.3.3 Preferred Stock. The ▇▇▇▇▇ Series A Stock and the ▇▇▇▇▇
Series B Stock shall have been converted to ▇▇▇▇▇ Common Stock at or prior to
the Effective Time, terminating all rights to any preference on liquidation that
may result from the operation of Article V. Section 5 of the ▇▇▇▇▇ Articles of
Incorporation as a consequence of the Merger. Alternatively, as to the ▇▇▇▇▇
Series B Stock only, the terms of such stock shall be revised at or prior to the
Effective Time and be clarified to provide that the Merger shall not trigger any
liquidation rights or preference or any such rights shall have been waived.
5.4 ▇▇▇▇▇ Stock Option Plan. Prior to the Effective Time, ▇▇▇▇▇
shall not grant any more warrants or any more options to its employees under the
▇▇▇▇▇ Stock Option Plan, provided that ▇▇▇▇▇ may, in the ordinary course
consistent with past practices, issue options to employees pursuant to the
provisions of its Stock Option Plan permitting the award of Management Grant
Options.
6. CLOSING MATTERS.
6.1 The Closing. Subject to termination of this Agreement as
provided in Section 9 below, the closing of the transactions provided for herein
(the "Closing") will take place at the offices of Morrison, Cohen, Singer &
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇
▇▇▇▇ ▇▇▇▇▇, at 10:00 a.m., Eastern Time on a date to be designated by Access
Beyond (the "Closing Date"), which (subject to the satisfaction or waiver of the
conditions set forth in Sections 7 and 8) shall be no later than the 5th
business day after satisfaction of the latest to occur of the conditions set
forth in Sections 7.5 and 8.5 (effectiveness of the Form S-4), 7.7 and 8.6
(obtaining approvals under the HSR Act) and 7.6 and 8.7 (obtaining stockholder
approval). Prior to, or concurrently with, the Closing, the Certificate of
Merger and such officers' certificates or other documents as may be required to
effectuate the Merger will be filed in the office of the Georgia Secretary of
State and the Merger will thereby become effective.
6.2 Exchange of Certificates.
6.2.1 ▇▇▇▇▇ Stock Converted. As of the Effective Time, all
shares of ▇▇▇▇▇ Stock that are outstanding immediately prior thereto will, by
virtue of the Merger and without further action, cease to exist, and all such
shares, except for Dissenting Shares, will be converted into the right to
receive from Access Beyond the number of shares and type of Access Beyond Stock
determined as set forth in Section 1 hereof. At and after the Effective Time,
each certificate representing outstanding shares of ▇▇▇▇▇ Stock, except for
Dissenting Shares, will represent the right to receive the number of shares of
Access Beyond Stock into which such shares of ▇▇▇▇▇ Stock have been converted,
and such shares of Access Beyond Stock will be registered in the name of the
holder of such certificate. Unless surrendered to Access Beyond for exchange at
the Closing, as soon as practicable after the Effective Time, each holder of
shares of ▇▇▇▇▇ Stock, except for holders of Dissenting Shares, will surrender
(a) the certificates for such shares (the "▇▇▇▇▇ Certificates") to Access Beyond
for cancellation or (b) an affidavit of lost (or nonissued) certificate and
indemnity with respect to the same, in form reasonably satisfactory to Access
Beyond. Promptly following the Effective Time and receipt of the ▇▇▇▇▇
Certificates, Access Beyond will cause its transfer agent to issue to each such
surrendering holder, certificate(s) for the number of shares of Access Beyond
Stock to which such holder is entitled pursuant to Section 1.1, subject to
Section 1.1.6 hereof, and Access Beyond will distribute any cash payable under
Section 1.2. After the Effective Time, there will be no further registration of
transfers of the shares of ▇▇▇▇▇ Stock on the stock transfer books of ▇▇▇▇▇.
6.2.2 Certificates Not Tendered. Until ▇▇▇▇▇ Certificates
representing ▇▇▇▇▇ Stock outstanding prior to the Merger are surrendered
pursuant to Section 6.2.1 above, such certificates, except for certificates
representing Dissenting Shares, will be deemed, for all purposes, to evidence
solely the right to receive (a) the number and type of shares of Access Beyond
Stock into which such shares of ▇▇▇▇▇ Stock will have been converted and (b) if
applicable, cash in lieu of fractional shares.
6.3 Assumption of Options and Warrants. Promptly after the Effective
Time, Access Beyond will notify in writing each holder of a ▇▇▇▇▇ Option or a
▇▇▇▇▇ Warrant of the assumption of such ▇▇▇▇▇ Option or ▇▇▇▇▇ Warrant by Access
Beyond, and the number of shares of Access Beyond Stock that are then subject to
such option or warrant and the exercise price of such option or warrant, as
determined pursuant to Section 1 hereof.
43
6.4 Access Beyond Options. To the extent that the transactions
contemplated hereby constitute a "Change of Control" (as defined in the Access
Beyond Plans), and outstanding Access Beyond options are terminated as a result
thereof, the Parties shall cause Access Beyond to issue substantially identical
replacement options to those participants remaining employed by or a director of
Access Beyond after the Effective Time, exercisable at the "Fair Market Value"
of the shares (as defined in the Access Beyond Plans) at the date of grant.
Credit shall be given to such participants of Access Beyond for time attained
under the terminated Access Beyond options. For purposes hereof, the date of
grant shall be the earlier of the ninetieth (90th) day following the Effective
Time or the date on which a remaining participant irrevocably waives his or her
right to exercise his or her option.
7. CONDITIONS TO OBLIGATIONS OF ▇▇▇▇▇.
▇▇▇▇▇' obligations hereunder are subject to the fulfillment or
satisfaction, on and as of the Closing, of each of the following conditions (any
one or more of which may be waived by ▇▇▇▇▇, but only in a writing signed on
behalf of ▇▇▇▇▇ by its Chairman or President).
7.1 Removal of Due Diligence and Other Conditions. During the thirty
(30) day period following the date of this Agreement (the "Due Diligence
Period"), ▇▇▇▇▇ shall have completed its discussions with customers and
suppliers of Access Beyond and shall have completed other due diligence and the
agreements referred to in Section 5.3 shall have been executed. A notice to that
effect shall have been sent to Access Beyond on or before the expiration of the
Due Diligence Period. If ▇▇▇▇▇ determines in its reasonable discretion that the
representations and warranties of Access Beyond contained herein are not true
and correct in all material respects or if Access Beyond has not received the
fairness opinion described in Section 8.16 by the end of the Due Diligence
Period, then ▇▇▇▇▇ may terminate this Agreement without liability to Access
Beyond therefor by sending written notice to Access Beyond on or before the
expiration of the Due Diligence Period. If such notice is not sent by such date,
the condition described in this Section 7.1 conclusively will be deemed
satisfied. ▇▇▇▇▇ agrees that information disclosed in the Disclosure Letter and
in documents heretofore filed by Access Beyond with the SEC (but not including
documents referenced in the Disclosure Letter or such filings, unless said
documents were themselves provided to ▇▇▇▇▇ or filed with the SEC) is acceptable
and to the extent that such information is true, correct and complete, shall not
be the basis for ▇▇▇▇▇ electing to terminate this Agreement under this Section
7.1
7.2 Covenants, Representations and Warranties. The representations
and warranties of Access Beyond set forth in Sections 3.1 through 3.13, 3.15,
3.21, 3.22, 3,23, 3.25 and 3.26 shall be true and complete in every material
respect as of the Closing with the same force and effect as if they had been
made at the Closing, Access Beyond shall have performed and complied in all
material respects with all of its covenants contained in Section 4 to be
performed before the Closing and ▇▇▇▇▇ shall have received a certificate to such
effect executed on behalf of Access Beyond by its President or Chief Financial
Officer.
44
7.3 Compliance with Law. There shall be no order, decree, ruling or
pending action by any court or governmental agency, or threat thereof, or any
other fact or circumstance, which would prohibit or render illegal the
transactions contemplated by this Agreement.
7.4 Government Consents. There shall have been obtained at or prior
to the Closing such permits or authorizations, and there shall have been taken
such other actions, as may be required to consummate the Merger by any
regulatory authority having jurisdiction over the Parties and the actions herein
proposed to be taken, including but not limited to satisfaction of all
requirements under applicable federal and state securities laws.
7.5 Form S-4. The Form S-4 shall have become effective under the
Securities Act and shall not be the subject of any stop order or proceedings
seeking a stop order and the Prospectus/Proxy Statement shall on the Closing not
be subject to any proceedings commenced or threatened by the SEC.
7.6 Documents and Consents. ▇▇▇▇▇ shall have received all written
consents, assignments, waivers, authorizations or other certificates of third
parties reasonably deemed necessary by ▇▇▇▇▇' legal counsel to consummate the
transactions provided for herein, including, without limitation, the approvals
and consents of Access Beyond and ▇▇▇▇▇ shareholders. Access Beyond shall have
deposited with Access Beyond's Transfer Agent the certificates representing the
shares of Access Beyond Stock to be issued as a consequence of the Merger
pending the return of the ▇▇▇▇▇ Certificates therefor; and ▇▇▇▇▇ shall have
received the Certificate of Officer as to Tax Matters from Access Beyond and
Newco in substantially the form attached hereto as Exhibit 1.5A.
7.7 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Compliance. All applicable waiting periods
under the HSR Act shall have expired or early termination shall have been
granted by both the Federal Trade Commission and the United States Department of
Justice.
7.8 No Litigation. No litigation or proceeding shall be pending
which will have the probable effect of enjoining or preventing the consummation
of any of the transactions provided for in this Agreement.
7.9 Opinion of Counsel. ▇▇▇▇▇ shall have received from Morrison,
Cohen, Singer & ▇▇▇▇▇▇▇▇▇, counsel to Access Beyond, an opinion reasonably
satisfactory to ▇▇▇▇▇' counsel.
7.10 Employment Agreements. Access Beyond, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ will have executed and delivered to Access Beyond Employment
Agreements substantially in the forms attached as Exhibits C-4 and C-5. Each of
such agreements will become effective at the Effective Time.
45
7.11 Tax-Free Transaction. The amount of the cash consideration
payable for Dissenting Shares pursuant to Section 1.1.6 hereof shall not cause
the Merger to fail to qualify as a tax-free reorganization under the Code.
7.12 Listing. The shares of Access Beyond Common Stock to be issued
in the Merger shall have been approved for listing (subject to notice of
issuance) on the Nasdaq National Market.
7.13 Access Beyond Restated Certificate. The stockholders of Access
Beyond shall have approved and the Secretary of State of Delaware shall have
accepted for filing the Amended and Restated Certificate of Incorporation
substantially in the form attached hereto as Exhibit 7.13 (the "Restated
Certificate") in order to (a) change Access Beyond's name to ▇▇▇▇▇
Communications Inc.; (b) create the Access Beyond Series A Stock in an amount
sufficient to provide for conversion of the ▇▇▇▇▇ Series B Stock; and (c) to
eliminate the classes of the Board of Directors.
7.14 Satisfactory Form of Legal and Accounting Matters. The form,
scope and substance of all legal and accounting matters contemplated hereby and
all closing documents and other papers delivered hereunder shall be reasonably
acceptable to ▇▇▇▇▇' counsel.
7.15 Resignations. The current officers and directors (except ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇ as a director) of Access Beyond shall resign their positions effective
as of the Effective Time, and Access Beyond shall use its best efforts to
include in the resignation with respect to such officers a general release of
Access Beyond from any liability for acts, events or circumstances prior to the
Effective Time. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ shall appoint the individuals to the Board in
the classes set forth in Section 7.16.
7.16 Access Beyond Board of Directors. The Board of Access Beyond
will consist of seven (7) Directors, as follows:
Chairman of the Board of ▇▇▇▇▇ (▇▇▇▇▇▇ ▇. ▇▇▇▇▇) - Class III
One (1) designee of the shareholders of ▇▇▇▇▇ (Chiang Lam) - Class I
Chairman of the Board of Access Beyond (▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇) -
Class III Three (3) other directors designated by ▇▇▇▇▇ Shareholders
in accordance with the procedures set forth in Article 8.1 of
the Shareholders Agreement - Two in Class II; One in Class I
One (1) outside director designated by Access Beyond - Class III
The above Directors will be appointed effective as of the Closing, except for
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇, who will be appointed as of the day after
Closing.
7.17 Shareholders Agreement. Access Beyond and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ will
have executed and delivered the Shareholders Agreement.
46
8. CONDITIONS TO OBLIGATIONS OF ACCESS BEYOND.
The obligations of Access Beyond hereunder are subject to the fulfillment
or satisfaction as of the Closing, of each of the following conditions (any one
or more of which may be waived by Access Beyond, but only in a writing signed on
behalf of Access Beyond by its President or Chief Financial Officer).
8.1 Removal of Due Diligence and Other Conditions. The business plan
prepared by ▇▇▇▇▇ for the period subsequent to the Closing with input from
Access Beyond shall be completed by the expiration of the Due Diligence Period
and Access Beyond shall have completed its discussions with customers and
suppliers of ▇▇▇▇▇ and other due diligence by the expiration of the Due
Diligence Period. If Access Beyond determines in its reasonable discretion that
the representations and warranties of ▇▇▇▇▇ contained herein are not true and
correct in all material respects or if ▇▇▇▇▇ has not, by the expiration of the
Due Diligence Period received the agreements required to be delivered hereunder
in Section 5.3 by such time, or if Access Beyond has not received the fairness
opinion described in Section 8.16 by the end of the Due Diligence Period, then
Access Beyond may terminate this Agreement without liability to ▇▇▇▇▇ therefor
by sending written notice to ▇▇▇▇▇ on or before the expiration of the Due
Diligence Period. If the notice described in this Section 8.1 is not sent by the
date specified above, the conditions described in this Section 8.1 to which such
notice relates (except for such fairness opinion) conclusively will be deemed
satisfied. Access Beyond agrees that information disclosed in the draft
Disclosure Letter (but not including documents referenced therein, unless said
documents were themselves provided to Access Beyond), the ▇▇▇▇▇ 1996 audited
financial statements, and the ▇▇▇▇▇ interim unaudited financial statements
through June 30, 1997, is acceptable and shall not, to the extent that such
information is true, correct and complete, be the basis for Access Beyond
electing to terminate this Agreement under this Section 8.1
8.2 Covenants, Representations and Warranties. The representations
and warranties of ▇▇▇▇▇ set forth in Sections 2.1 through 2.13, 2.15, 2.21, 2.22
and 2.25 shall be true and complete in every material respect as of the Closing
with the same force and effect as if they had been made at the Closing, ▇▇▇▇▇
shall have performed and complied in all material respects with all of its
covenants contained in Sections 4 and 5 to be performed before the Closing and
Access Beyond shall have received a certificate to such effect executed on
behalf of ▇▇▇▇▇ by its President or Chief Financial Officer.
8.3 Compliance with Law. There shall be no order, decree, ruling or
pending action by any court or governmental agency or threat thereof, or any
other fact or circumstance, which would prohibit or render illegal the
transactions provided for in this Agreement.
8.4 Government Consents. There shall have been obtained at or prior
to the Closing such permits or authorizations, and there shall have been taken
such other actions, as may be required to consummate the Merger by any
regulatory authority having jurisdiction over the
47
Parties and the actions herein proposed to be taken, including but not limited
to satisfaction of all requirements under applicable federal and state
securities laws.
8.5 Form S-4. The Form S-4 shall have become effective under the
Securities Act and shall not be the subject of any stop order or proceedings
seeking a stop order and the Prospectus/Proxy Statement shall on the Closing not
be subject to any proceedings commenced or threatened by the SEC.
8.6 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Compliance. All applicable waiting periods
under the HSR Act shall have expired or early termination shall have been
granted by both the Federal Trade Commission and the United States Department of
Justice.
8.7 Documents and Consents. Access Beyond shall have received all
written consents, assignments, waivers, authorizations or other certificates of
third parties reasonably deemed necessary by Access Beyond's legal counsel to
provide for the continuation in full force and effect of any and all material
contracts and leases of ▇▇▇▇▇ and for Access Beyond to consummate the
transactions contemplated hereby, including, without limitation, the consents of
the securities holders described in Sections 5.3.1 through 5.3.4 above to
cancellation or amendment, as described therein, and the approvals and consents
of Access Beyond and ▇▇▇▇▇ shareholders. Access Beyond shall have received the
Certificate of Officer as to Tax Matters from ▇▇▇▇▇ in substantially the form
attached hereto as Exhibit 1.5B.
8.8 No Litigation. No litigation or proceeding shall be pending
which will have the probable effect of enjoining or preventing the consummation
of any of the transactions provided for in this Agreement.
8.9 Opinion of Counsel. Access Beyond shall have received from
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC, counsel to ▇▇▇▇▇, an opinion reasonably
satisfactory to Access Beyond's counsel.
8.10 Employment Agreements. Access Beyond, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ will have executed and delivered to Access Beyond Employment
Agreements substantially in the forms attached as Exhibits C-4 and C-5,
respectively. Each of such agreements will become effective at the Effective
Time.
8.11 Listing. The shares of Access Beyond Common Stock to be issued
in the Merger shall have been approved for listing (subject to notice of
issuance) on the Nasdaq National Market.
8.12 Affiliate Agreements. Each of the ▇▇▇▇▇ Affiliate Agreements,
the Voting Agreements, the Market Standoff Agreement and the Shareholders
Agreement shall have been executed and delivered prior to the expiration of the
Due Diligence Period and shall remain in full force and effect as of the
Effective Time.
48
8.13 Satisfactory Form of Legal and Accounting Matters. The form,
scope and substance of all legal and accounting matters contemplated hereby and
all closing documents and other papers delivered hereunder shall be reasonably
acceptable to Access Beyond's counsel.
8.14 Completion of Other Actions. ▇▇▇▇▇ shall have accomplished the
matters set forth in paragraphs 5.3.1 and 5.3.2 not later than the expiration of
the Due Diligence Period.
8.15 Access Beyond Restated Certificate. The stockholders of Access
Beyond shall have approved and the Secretary of State of Delaware shall have
accepted for filing the Restated Certificate.
8.16 Fairness Opinion. Access Beyond shall have received an opinion
from ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇, its Investment Bankers, by no later than the
expiration of the Due Diligence Period, stating that the Merger is fair to
Access Beyond and its stockholders from a financial point of view of the
Conversion Ratio, which opinion shall be updated at the Closing and shall
otherwise be reasonably acceptable to Access Beyond.
8.17 Access Beyond Board of Directors. The Board of Access Beyond
will consist of seven (7) Directors, as follows:
Chairman of the Board of ▇▇▇▇▇ (▇▇▇▇▇▇ ▇. ▇▇▇▇▇) - Class III
One (1) designee of the shareholders of ▇▇▇▇▇ (Chiang Lam) - Class I
Chairman of the Board of Access Beyond (▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇) -
Class III Three (3) other directors designated by ▇▇▇▇▇ Shareholders
in accordance with the procedures set forth in Article 8.1 of
the Shareholders Agreement - Two in Class II; One in Class I
One (1) outside director designated by Access Beyond - Class III
The above Directors will be appointed effective as of the Closing, except for
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇, who will be appointed as of the day after
Closing.
9. TERMINATION OF AGREEMENT.
9.1 Termination. This Agreement may be terminated prior to the
Effective time, whether before or after approval of the Merger by the
stockholders or shareholders of either or both of the Parties:
(a) by mutual written consent of Access Beyond and ▇▇▇▇▇;
(b) by either Access Beyond or ▇▇▇▇▇ if the Merger shall not
have been consummated by 5:00 p.m. (Eastern Time) on December 31, 1997
(unless the failure to consummate the Merger is attributable to a failure
on the part of the Party seeking to
49
terminate this Agreement to perform any material obligation required to be
performed by such Party at or prior to the Effective Time);
(c) by either Access Beyond or ▇▇▇▇▇ if a court of competent
jurisdiction or other governmental body or agency shall have issued a
final and nonappealable order, decree or ruling, or shall have taken any
other action, having the effect of permanently restraining, enjoining or
otherwise prohibiting the Merger;
(d) by either Access Beyond or ▇▇▇▇▇ if (i) any of the
applicable ▇▇▇▇▇ Shareholders repudiate the Voting Agreements (Exhibit
C-1) entered into by them, or if (ii) the ▇▇▇▇▇ Shareholders Meeting shall
have been held and this Agreement and the Merger shall not have been
adopted and approved at such meeting by the vote required by law or if
(iii) the required ▇▇▇▇▇ Shareholder Meeting to vote on the Agreement is
not held within ten (10) business days after SEC clearance of Form S-4 as
contemplated in Sections 7.5 and 8.5; provided, however, that (i) Access
Beyond shall not be permitted to terminate this Agreement pursuant to this
clause (d) if the failure of the ▇▇▇▇▇ shareholders to adopt and approve
this Agreement and the Merger at the ▇▇▇▇▇ Shareholders Meeting is
attributable to a failure on the part of Access Beyond to perform any
material obligation required to have been performed by Access Beyond under
this Agreement, or if the Voting Agreements have terminated in accordance
with their terms prior to the ▇▇▇▇▇ Shareholders' Meeting and (ii) ▇▇▇▇▇
shall not be permitted to terminate this Agreement pursuant to this clause
(d) if the failure of the ▇▇▇▇▇ shareholders to adopt and approve this
Agreement and the Merger at the ▇▇▇▇▇ Shareholders Meeting is attributable
to a failure on the part of ▇▇▇▇▇ to perform any material obligation
required to have been performed by ▇▇▇▇▇ under this Agreement;
(e) by either Access Beyond or ▇▇▇▇▇ if (i) the Access Beyond
Stockholders Meeting shall have been held and (ii) this Agreement and the
Merger shall not have been adopted and approved at such meeting by the
vote required by law; or if the required Access Beyond Stockholders
Meeting to vote on the Agreement is not held within sixty (60) days after
SEC clearance of Form S-4, as contemplated in Sections 7.5 and 8.5;
provided, however, that (i) ▇▇▇▇▇ shall not be permitted to terminate this
Agreement pursuant to this clause (e) if the failure of the Access Beyond
stockholders to adopt and approve this Agreement and the Merger at the
Access Beyond Stockholders Meeting is attributable to a failure on the
part of ▇▇▇▇▇ to perform any material obligation required to have been
performed by ▇▇▇▇▇ under this Agreement, (ii) Access Beyond shall not be
permitted to terminate this Agreement pursuant to this clause (e) if the
failure of the Access Beyond stockholders to adopt and approve this
Agreement and the Merger at the Access Beyond Stockholders Meeting is
attributable to a failure on the part of Access Beyond to perform any
material obligation required to have been performed by Access Beyond under
this Agreement;
50
(f) by Access Beyond (at any time prior to the adoption and
approval of this Agreement and the Merger by the ▇▇▇▇▇ shareholders by the
vote required by law) if a "Triggering Event" with respect to ▇▇▇▇▇ as the
"Triggering Party" shall have occurred. A "Triggering Event" shall have
occurred if (i) the Board of Directors of one of the Parties hereto (the
"Triggering Party") shall have failed to recommend, or shall for any
reason have withdrawn or shall have amended or modified in a manner
adverse to the other Party its unanimous recommendation in favor of, the
Merger or approval or adoption of this Agreement; (ii) the Triggering
Party shall have failed to include in the Prospectus/Proxy Statement the
unanimous recommendation of the Board of Directors of the Triggering Party
in favor of approval and adoption of this Agreement and the Merger, (iii)
the Board of Directors of the Triggering Party shall have approved,
endorsed or recommended any Acquisition Proposal, or (iv) the Triggering
Party shall have failed to hold the Triggering Party Stockholders Meeting
as promptly as practicable and in any event within 60 days after the Form
S-4 is declared effective;
(g) by ▇▇▇▇▇ (at any time prior to the adoption and approval
of this Agreement and the Merger by the Access Beyond stockholders by the
vote required by law) if a Triggering Event with respect to Access Beyond
as the Triggering Party shall have occurred;
(h) by Access Beyond if any of the ▇▇▇▇▇' representations and
warranties contained in this Agreement shall be or shall have become
materially inaccurate, or if any of ▇▇▇▇▇' material covenants contained in
this Agreement shall have been breached in any material respect or failure
of a condition set forth in Section 8 to be met, which is incapable of
being cured or satisfied; provided, however, that if an inaccuracy in
▇▇▇▇▇' representations and warranties or a breach of covenant by ▇▇▇▇▇ is
curable by ▇▇▇▇▇ and ▇▇▇▇▇ is continuing to exercise reasonable efforts to
cure such inaccuracy or breach, then Access Beyond may not terminate this
Agreement under this Section 9.1(h) on account of such inaccuracy or
breach; or
(i) by ▇▇▇▇▇ if any of Access Beyond's representations and
warranties contained in this Agreement shall be materially inaccurate as
of the date of this Agreement or those representations and warranties
listed in Section 7.2 shall have become materially inaccurate, or if any
of Access Beyond's material covenants contained in this Agreement shall
have been breached in any material respect or failure of a condition set
forth in Section 7 to be met, which is incapable of being cured or
satisfied; provided, however, that if any inaccuracy in Access Beyond's
representations and warranties or a breach of a covenant by Access Beyond
is curable by Access Beyond and Access Beyond is continuing to exercise
reasonable efforts to cure such inaccuracy or breach, then ▇▇▇▇▇ may not
terminate this Agreement under this Section 9.1 (i) on account of such
inaccuracy or breach.
51
9.2 Effect of Termination. In the event of the termination of this
Agreement as provided in Section 9.1, this Agreement shall be of no further
force or effect; provided, however, that (a) this Section 9.2, Section 9.3,
Section 10 and Section 11 shall survive the termination of this Agreement and
shall remain in full force and effect, and (b) the termination of this Agreement
shall not relieve any Party, from any liability for any breach of this Agreement
by such Party.
9.3 Expenses; Termination Fees.
9.3.1 Allocation. Except as set forth in this Section 9.3,
each Party will bear its respective expenses and fees of its own accountants,
attorneys, investment bankers and other professionals incurred with respect to
this Agreement and the transactions contemplated hereby, whether or not the
Merger is consummated; provided, however, that ▇▇▇▇▇ and Access Beyond shall
share equally all fees and expenses, other than attorneys' fees, incurred in
connection with the printing and filing of the Form S-4 and the Prospectus/Proxy
Statement and any amendments or supplements thereto. Each Party shall promptly
reimburse its principal shareholders, stockholders, officers and directors for
amounts paid by them as filing fees to governmental agencies and other
reasonable and necessary expenses that are incurred by such persons to comply
with any consent or approval required to be obtained in order to perform this
Agreement.
9.3.2 Break-up Fee.
(a) If this Agreement is terminated by Access Beyond pursuant
to Section 9.1(f) or by ▇▇▇▇▇ pursuant to Section 9.1(g), and the
stockholders of ▇▇▇▇▇ or Access Beyond, respectively, fail to approve the
Merger, then the non-terminating Party shall pay to the terminating Party,
as nonrefundable liquidated damages, in cash upon the last to occur of the
Triggering Events, the total out-of-pocket expenses of the terminating
Party incurred in connection with the negotiation and performance of this
Agreement, plus $200,000, provided, however, that the aggregate amount of
such payment shall not exceed $500,000;
(b) In addition, if either Party publicly announces the
entering into of an agreement relating to an Acquisition Transaction
within six months after the date of termination pursuant to Section 9.1(f)
or 9.1(g), then the nonrefundable liquidated damages described in Section
9.3.2(a) shall increase to $2,000,000, with the additional amount to be
paid in cash within three business days after the closing of such
Acquisition Transaction. Such liquidated damages shall be the sole remedy
of ▇▇▇▇▇ against Access Beyond for its termination under Section 9.1(g)
and the sole remedy of Access Beyond against ▇▇▇▇▇ for its termination
under Section 9.1(f);
(c) If this Agreement is terminated by ▇▇▇▇▇ pursuant to
Section 7.1 of this Agreement as provided therein or by Access Beyond due
to its failure to satisfy the
52
condition set forth in Section 8.16, Access Beyond shall pay to ▇▇▇▇▇ a
termination fee in the amount of ▇▇▇▇▇' total out-of-pocket expenses
incurred in connection with negotiation and performance of this Agreement,
provided that the aggregate amount of such termination fee shall not
exceed $250,000, whereupon this Agreement shall be of no further force or
effect and such remedy shall be ▇▇▇▇▇' sole remedy for termination
pursuant to Section 7.1;
(d) If this Agreement is terminated by Access Beyond pursuant
to Section 8.1 of this Agreement as provided therein other than for
failure to obtain the required fairness opinion, ▇▇▇▇▇ shall pay to Access
Beyond a termination fee in the amount of Access Beyond's total
out-of-pocket expenses incurred in connection with negotiation and
performance of this Agreement, provided that the aggregate amount of such
termination fee shall not exceed $250,000, whereupon this Agreement shall
be of no further force or effect and such remedy shall be Access Beyond's
sole remedy for termination pursuant to Section 8.1; and
(e) If this Agreement is terminated by either Party pursuant
to Section 9.1(d) as provided therein or is terminated by ▇▇▇▇▇ for
failure of the condition set forth in Section 7.11 to be met, then ▇▇▇▇▇
shall pay Access Beyond a termination fee in the amount of $2,000,000, as
nonrefundable liquidated damages. Such liquidated damages shall be the
sole remedy of Access Beyond against ▇▇▇▇▇ in such event.
10. NO SURVIVAL OF REPRESENTATIONS.
All representations and warranties of the Parties contained in this
Agreement will expire as of the Effective Time and be of no further force or
effect subsequent to such time. Except for the obligations of the Parties under
Section 11 below, the representations and warranties of the Parties contained in
this Agreement will terminate as of the termination of this Agreement in
accordance with Section 9.1, clauses (a), (b) or (c).
11. GENERAL PROVISIONS.
11.1 Governing Law; Dispute Resolution. The internal laws of the
State of Delaware (irrespective of its choice of law principles) will govern the
validity of this Agreement, the construction of its terms, and the
interpretation and enforcement of the rights and duties of the Parties hereto.
Any dispute hereunder ("Dispute") shall be settled by arbitration in Dover,
Delaware, and, except as herein specifically stated, in accordance with the
commercial arbitration rules of the American Arbitration Association ("AAA
Rules") then in effect. However, in all events, these arbitration provisions
shall govern over any conflicting rules which may now or hereafter be contained
in the AAA Rules. Any judgment upon the award rendered by the arbitrator may be
entered in any court having jurisdiction over the subject matter thereof. The
arbitrator shall have the authority to grant any equitable and legal remedies
that would be available in any judicial proceeding instituted to resolve a
Dispute.
53
11.1.1 Compensation of Arbitrator. Any such arbitration will
be conducted before a single arbitrator who will be compensated for his or her
services at a rate to be determined by the Parties or, if the Parties are unable
to agree, by the American Arbitration Association (the "AAA").
11.1.2 Selection of Arbitrator. The AAA will have the
authority to select an arbitrator from a list of five arbitrators who are
lawyers familiar with Delaware contract law; provided, however, that such
lawyers cannot work for a firm then performing services for either Party, that
each Party will have the opportunity to make such reasonable objection to any
two of the arbitrators listed as such Party may desire and that the AAA will
select the arbitrator from the list of arbitrators as to whom neither Party
makes any such objection.
11.1.3 Payment of Costs. Access Beyond and, before the
Closing, ▇▇▇▇▇, will bear the expense of deposits and advances required by the
arbitrator in equal proportions, but either Party may advance such amounts,
subject to recovery as an addition or offset to any award. The arbitrator will
award to the prevailing Party, as determined by the arbitrator, all costs, fees
and expenses related to the arbitration, including reasonable fees and expenses
of attorneys, accountants and other professionals that were incurred by the
prevailing Party.
11.1.4 Burden of Proof. For any Dispute submitted to
arbitration, the burden of proof will be as it would be if the claim were
litigated in a judicial proceeding.
11.1.5 Award. Upon the conclusion of any arbitration
proceedings hereunder, the arbitrator will render findings of fact and
conclusions of law and a written opinion setting forth the basis and reasons for
any decision reached and will deliver such documents to each Party to this
Agreement along with a signed copy of the award.
11.1.6 Terms of Arbitration. The arbitrator chosen in
accordance with these provisions will not have the power to alter, amend or
otherwise affect the terms of these arbitration provisions.
11.1.7 Exclusive Remedy. Except as specifically otherwise
provided in this Agreement, arbitration will be the sole and exclusive remedy of
the Parties for any Dispute arising out of this Agreement.
11.2 Assignment; Binding Upon Successors and Assigns. None of the
Parties hereto may assign any of its or his rights or obligations hereunder
without the prior written consent of the other Parties hereto. This Agreement
will be binding upon and inure to the benefit of the Parties hereto and their
respective successors and permitted assigns.
11.3 Severability. If any provision of this Agreement, or the
application thereof, is for any reason held to any extent to be invalid or
unenforceable, the remainder of this Agreement and application of such provision
to other persons or circumstances will be interpreted
54
so as reasonably to effect the intent of the Parties hereto. The Parties further
agree to replace such unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business and other purposes of the void or unenforceable provision.
11.4 Counterparts. This Agreement may be executed in counterparts,
each of which will be an original as regards any Party whose name appears
thereon and all of which together will constitute one and the same agreement.
This Agreement will become binding when one or more counterparts hereof,
individually or taken together, bear the signatures of all Parties reflected
hereon as signatories.
11.5 Other Remedies. Except as otherwise provided herein, any and
all remedies herein expressly conferred upon a Party will be deemed cumulative
with and not exclusive of any other remedy conferred hereby or by law on such
Party, and the exercise of any one remedy will not preclude the exercise of any
other.
11.6 Amendment and Waivers. Any term or provision of this Agreement
may be amended, and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only by a writing signed by the Parties to be bound thereby. The
waiver by a Party of any breach hereof or default in the performance hereof will
not be deemed to constitute a waiver of any other default or any succeeding
breach or default. This Agreement may be amended by the Parties hereto at any
time before or after approval of the ▇▇▇▇▇ or Access Beyond shareholders or
stockholders, respectively.
11.7 No Waiver. The failure of any Party to enforce any of the
provisions hereof will not be construed to be a waiver of the right of such
Party thereafter to enforce such provisions. The waiver by any Party of the
right to enforce any of the provisions hereof on any occasion will not be
construed to be a waiver of the right of such Party to enforce such provision on
any other occasion.
11.8 Notices. All notices, requests, demands and other
communications required or permitted hereunder shall be in writing and by any
one or more of the following means: (i) if mailed by prepaid first class mail or
certified mail, return receipt requested, at any time other than during a
general discontinuance of postal service due to strike, lockout or otherwise,
such notice shall be deemed to have been received on the earlier of the date
shown on the receipt or three (3) business days after the postmarked date
thereof; (ii) if telexed or telecopied, such notice shall be followed forthwith
by letter and shall be deemed to have been received on the next business day
following dispatch and acknowledgment of receipt by the recipient's telex or
telecopy machine; (iii) if delivered by hand, such notice shall be deemed
effective when delivered; or (iv) if delivered by overnight courier, such notice
shall be deemed to have been received on the next business day following
delivery to such courier. All notices and other communications under this
Agreement shall be given to the Parties hereto at the following addresses:
55
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to ▇▇▇▇▇:
(If via hand delivery or overnight courier)
▇▇▇▇▇ Microcomputer Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chairman of the Board and
Contracts Administration
(If via mail)
▇▇▇▇▇ Microcomputer Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman of the Board and
Contracts Administration
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: G. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any Party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 11.8.
56
11.9 Construction of Agreement. The language hereof will not be
construed for or against either Party. A reference to an article, section or
exhibit will mean an article or section in, or an exhibit to, this Agreement,
unless otherwise explicitly set forth. The titles and headings in this Agreement
are for reference purposes only and will not in any manner limit the
construction of this Agreement. For the purposes of such construction, this
Agreement will be considered as a whole.
11.10 No Joint Venture. Nothing contained in this Agreement will be
deemed or construed as creating a joint venture or partnership among or between
any of the Parties hereto. No Party is by virtue of this Agreement authorized as
an agent, employee or legal representative of any other Party. No Party will
have the power to control the activities and operations of any other. No Party
will have any power or authority to bind or commit any other. No Party will hold
itself out as having any authority or relationship in contravention of this
Section.
11.11 Further Assurances. Each Party agrees to cooperate fully with
the other Party and to execute such further documents and agreements and to give
such further written assurances as may be reasonably requested by the other
Party to evidence and reflect the transaction provided for herein and to carry
into effect the intent of this Agreement.
11.12 Absence of Third Party Beneficiary Rights. No provisions of
this Agreement are intended, nor will be interpreted, to provide or create any
third party beneficiary rights or any other rights of any kind in any client,
customer, affiliate, partner or employee of any Party hereto or any other person
or entity, unless specifically provided otherwise herein, and, except as so
provided, all provisions hereof will be personal solely among the Parties to
this Agreement; provided that the provisions of Section 4.8 shall be for the
benefit of the officers and directors of ▇▇▇▇▇ and Access Beyond; provided,
however, that Section 6.4 shall be for the benefit of the Access Beyond
optionees, and Sections 1.3.1 and 6.3 shall be for the benefit of the holders of
the ▇▇▇▇▇ Options and ▇▇▇▇▇ Warrants.
11.13 Time is of the Essence. The Parties hereto acknowledge and
agree that time is of the essence in connection with the execution, delivery and
performance of this Agreement.
11.14 Entire Agreement. Except as specifically set forth herein,
this Agreement, the exhibits hereto and the documents and certificates to be
delivered hereunder constitute the entire understanding and agreement of the
Parties hereto with respect to the subject matter hereof and supersede all prior
and contemporaneous agreements or understandings, inducements or conditions,
express or implied, written or oral, between the Parties with respect to the
subject matter hereof. The express terms hereof control and supersede any course
of performance or usage of trade inconsistent with any of the terms hereof.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
57
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
ACCESS BEYOND, INC. ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
BY: By:
---------------------------------- ----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman
Signature Page to Agreement and
Plan of Reorganization
58
EXHIBIT A
Form of Certificate of Merger
59
▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
CERTIFICATE OF MERGER
Pursuant to the provisions of Section 14-2-1105 of the Georgia Business
Corporation Code, ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC., a corporation organized
and existing under the laws of the State of Georgia (hereinafter referred to as
"▇▇▇▇▇") hereby executes the following Certificate of Merger.
I.
H&A MERGER SUB, INC. (hereinafter referred to as "H&A"), a corporation
organized and existing under the laws of the State of Georgia, shall be merged
with and into ▇▇▇▇▇, so that ▇▇▇▇▇ is the surviving corporation of such merger
(hereinafter referred to as the "Merger"). The name of the surviving corporation
shall be ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
II.
The Merger shall be effective at [5:00] p.m. on ______________, 1997.
III.
The Merger has been duly approved by the shareholders of ▇▇▇▇▇ and H&A.
IV.
The executed Agreement and Plan of Reorganization is on file at the
principal place of business of ▇▇▇▇▇, the surviving corporation, which
address on the date hereof is:
▇▇▇▇▇ Microcomputer Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
A copy of said Agreement and Plan of Reorganization will be furnished by ▇▇▇▇▇,
the surviving corporation, on request and without cost to any shareholder of
▇▇▇▇▇ or H&A.
V.
The undersigned hereby certifies that ▇▇▇▇▇ is the surviving corporation,
has delivered the request for publication of a notice relating to the filing of
this Certificate of Merger, together with payment therefor, as required by
Section 14-2-1105.1(b) of the Georgia Business Corporations Code.
60
IN WITNESS WHEREOF, the undersigned ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC. has
caused this CERTIFICATE OF MERGER to be executed by its authorized officer this
_____ day of ____________, 1997.
▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
By:
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman
ATTEST:
----------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇. Secretary
61
EXHIBIT C-1
Form of Voting Agreement
62
VOTING AGREEMENT Chestnut
This Voting Agreement is entered into as of July __, 1997, by and between
Access Beyond, Inc., a Delaware corporation ("Access Beyond") and Chestnut
Capital Limited Partnership ("Shareholder").
RECITALS
A. Access Beyond and ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia
corporation ("▇▇▇▇▇"), have entered into an Agreement and Plan of Reorganization
of even date herewith (the "Merger Agreement", which term is deemed to include
all Exhibits and Schedules thereto), which provides (subject to the conditions
set forth therein) for the merger of a wholly-owned subsidiary of Access Beyond
("Newco") with and into ▇▇▇▇▇ in a reverse triangular merger (the "Merger"),
with ▇▇▇▇▇ to be the surviving corporation of the Merger. Capitalized terms used
but not otherwise defined in this Voting Agreement have the meanings ascribed to
such terms in the Merger Agreement.
B. As of the date hereof, Shareholder owns in the aggregate (including
shares held both beneficially and of record and other shares held either
beneficially or of record) the number of shares of the Common Stock, the Series
A Preferred Stock or the Series B Preferred Stock of ▇▇▇▇▇ set forth below
Shareholder's name on the signature page hereof (4,212,958 of such shares being
referred to herein as the "Subject Shares").
C. As a condition to the willingness of Access Beyond to enter into the
Merger Agreement, Access Beyond has required that Shareholder agree, and in
order to induce Access Beyond to enter into the Merger Agreement Shareholder has
agreed to enter into this Voting Agreement.
NOW, THEREFORE, the parties to this Voting Agreement, intending to be
legally bound, agree as follows:
1. RESTRICTIONS ON TRANSFER
1.1 No Disposition of or Encumbrances on Subject Shares.
(a) Shareholder hereby covenants and agrees that prior to the
Expiration Date (as defined below), Shareholder will not, directly or
indirectly, (i) offer, sell, offer to sell, contract to sell, pledge, grant any
option to purchase or otherwise dispose of or transfer (or announce any offer,
sale, offer of sale, contract of sale, or grant of any option to purchase or
other disposition or transfer of) any of the Subject Shares to any person or
entity (each, a "Person") other than Access Beyond, (ii) create, or permit to
exist any encumbrances on any of the Subject Shares or (iii) reduce its
beneficial ownership of, interest in, or economic risk relating to, any of the
Subject Shares.
1
(b) As used in this Voting Agreement, the term "Expiration Date"
shall mean the earlier of (i) the date upon which the Merger Agreement is
validly terminated, (ii) the date upon which the Merger becomes effective, or
(iii) any waiver of either any closing condition in favor of ▇▇▇▇▇ or any
obligation of Access Beyond under or any amendment of the Merger Agreement, the
giving of any required consent of ▇▇▇▇▇ under Section 4.3 or any other provision
of the Merger Agreement unless such waiver, amendment or consent is approved
either by the Board of Directors of ▇▇▇▇▇ or the Transaction Committee thereof
established by the ▇▇▇▇▇ Board on July 28, 1997.
1.2 Transfer of Voting Rights. Shareholder covenants and agrees that,
prior to the Expiration Date, Shareholder will not deposit any of the Subject
Shares into a voting trust or grant a proxy or enter into a voting agreement
with respect to any of the Subject Shares, except as contemplated hereby.
1.3 Post-Effective Time Market Standoff.
(a) Shareholder hereby covenants and agrees that, in the event the
Merger is consummated, for a period of ninety (90) days after the
Effective Time of the Merger (the "Stand-Off Period"), Shareholder will
not, directly or indirectly, (i) offer, sell, offer to sell, contract to
sell, pledge, grant any option to purchase or otherwise, dispose of or
transfer (or announce any offer, sale, offer of sale, contract of sale or
grant of any option to purchase or other disposition or transfer of) any
of the Access Beyond Securities (as defined below) to any Person, (ii)
create or permit to exist any encumbrances on any of the Access Beyond
Securities or (iii) reduce its beneficial ownership of, interest in, or
risk relating to, any of the Access Beyond Securities.
(b) Shareholder hereby covenants and agrees that in the event the
Merger is consummated, for a period of one hundred eighty (180) days after
the Stand-Off Period, Shareholder will not, directly or indirectly, (i)
offer, sell, offer to sell, contract to sell, pledge, grant any option to
purchase or otherwise, dispose of or transfer (or announce any offer,
sale, offer of sale, contract of sale or grant of any option to purchase
or other disposition or transfer of) any of the Access Beyond Securities
to any Person, (ii) create or permit to exist any encumbrances on any of
the Access Beyond Securities or (iii) reduce its beneficial ownership of,
interest in, or risk relating to, any of the Access Beyond Securities;
provided that paragraph 1.3(a) and (b) shall not apply to any of the
Subject Shares pledged by Chestnut Capital, LLC pursuant to a Pledge
Agreement of even date securing the Subordinated Convertible Notes, as
amended, described in the ▇▇▇▇▇ Disclosure Letter; and, provided further
that this paragraph 1.3(b) shall not apply to any sale of the Subject
Shares by Chestnut Capital, LLC in an amount not to exceed $3.0 Million.
(c) As used in this Voting Agreement, the term "Access Beyond
Securities" shall mean all shares of capital stock of Access Beyond
received by Shareholder in the
2
Merger or otherwise acquired or held by Shareholder. The Access Beyond
Securities shall not include the shares of Chestnut Capital, LLC pledged
to certain shareholders of ▇▇▇▇▇ pursuant to that certain Stock Pledge
Agreement of even date between Chestnut Capital, LLC and certain other
shareholders of ▇▇▇▇▇.
2. VOTING AGREEMENTS
2.1 Pre-Termination Voting Agreement. Shareholder hereby agrees that,
prior to the Expiration Date, at any meeting of the shareholders of ▇▇▇▇▇,
however called, and in any written action by consent of shareholders of ▇▇▇▇▇,
unless otherwise directed in writing by Access Beyond, Shareholder shall vote
the Subject Shares:
(i) in favor of the Merger, the execution and delivery by ▇▇▇▇▇ of
the Merger Agreement and the adoption and approval of the terms thereof
and in favor of each of the other actions contemplated by the Merger
Agreement and any action required in furtherance hereof and thereof;
(ii) against any Acquisition Proposal (other than the Merger) and
against any action or agreement that would result in a breach of any
covenant or obligation of ▇▇▇▇▇ in the Merger Agreement; and
(iii) against any other action which is intended, or could
reasonably be expected to, materially impede, interfere with, delay,
postpone, or adversely affect the Merger or any of the other transactions
contemplated by the Merger Agreement.
Prior to the Expiration Date, Shareholder shall not enter into any agreement or
understanding with any Person to vote or give instructions in any manner
inconsistent with clause "(i)", "(ii)", or "(iii)" of the preceding sentence.
3. WAIVER OF APPRAISAL RIGHTS
Shareholder hereby irrevocably waives and agrees with respect to the
Subject Shares not to assert any and all rights of appraisal or dissenters'
rights that Shareholder may have or hereafter acquire pursuant to Article 13 of
the Georgia Business Corporation Code or any other applicable laws in connection
with the Merger.
4. NOTICE OF SHAREHOLDER MEETINGS AND PROPOSED CONSENTS
For the purpose of effectively carrying out and furthering the intent of
this Voting Agreement and allowing Access Beyond to exercise its rights
hereunder, Shareholder agrees to give Access Beyond prompt written notice of any
meeting of the shareholders of ▇▇▇▇▇ or proposed written consent of the
shareholders of ▇▇▇▇▇ with respect to the matters covered by the Proxy (which
notice shall, in any event be given in a manner to be received not later than
two (2)
3
days before such meeting or consent). Access Beyond acknowledges that the
obligations of this Section 4 will be satisfied with respect to a given meeting
or proposed written consent once it has received notice with respect to such
meeting or proposed written consent from any of Shareholder, ▇▇▇▇▇ or any other
shareholder of ▇▇▇▇▇ executing a similar voting agreement.
5. MISCELLANEOUS
5.1 Indemnification. Shareholder shall hold harmless and indemnify Access
Beyond from and against any and all claims, demands, actions, losses, costs,
damages, liabilities and expenses including, without limitation, attorney's fees
(collectively "Damages") (regardless of whether or not such Damages relate to a
third-party claim) which are incurred by Access Beyond to the extent that such
Damages arise from any breach of any covenant or obligation of Shareholder
contained herein.
5.2 Expenses. All costs and expenses incurred in connection with the
transactions contemplated by this Voting Agreement shall be paid by the party
incurring such costs and expenses; provided, however, that the Shareholder's
legal costs and expenses shall be promptly paid by ▇▇▇▇▇.
5.3 Notices. All notices, approvals, consents, requests and other
communications that any party is required or elects to give hereunder shall be
in writing and shall be deemed to have been given (a) upon personal delivery
thereof, including by appropriate international courier service, five (5) days
after delivery to the courier or, if earlier, upon delivery against a signed
receipt therefor or (b) upon transmission by facsimile or telecopier, which
transmission is confirmed, in either case addressed to the party to be notified
at the address set forth below or at such other address as such party shall have
notified the other parties hereto, by notice given in conformity with this
Section 5.3:
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
4
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Shareholder:
At the address set forth below Shareholder's signature
on the signature page hereto
with a copy to:
Counsel for Shareholder, if any, at the address shown on
the signature page hereto
Any party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 5.3.
5.4 Severability. Any term or provision of this Voting Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Voting Agreement or affecting the validity or enforceability of any of the terms
or provisions of this Voting Agreement in any other jurisdiction. If any
provision of this Voting Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
5.5 Entire Agreement. This Voting Agreement and any documents delivered by
the parties in connection herewith constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings between the parties with respect thereto.
5.6 Amendment and Waivers. Any term or provision of this Voting Agreement
may be amended, and the observance of any term of this Voting Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only by a writing signed by the parties to be bound thereby. The
waiver by a party of any breach hereof or default in the performance hereof will
not be deemed to constitute a waiver of any other default or any succeeding
breach or default.
5.7 Assignment, Binding Effect. Except as provided herein, neither this
Voting Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by either of the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other party. Subject to the
preceding sentence, this Voting Agreement shall be binding upon
5
and shall inure to the benefit of (i) Shareholder and his heirs, successor and
assigns and (ii) Access Beyond and its successors and assigns.
5.8 Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any of the provisions of this Voting Agreement are
not performed in accordance with its specific terms or was otherwise breached.
It is accordingly agreed that Access Beyond shall be entitled to an injunction
or injunctions to prevent breaches of this Voting Agreement and to enforce
specifically the terms and provisions hereof, this being in addition to any
other remedy to which Access Beyond is entitled at law or in equity.
5.9 Other Agreements. Nothing in this Voting Agreement shall limit any of
the rights or remedies of Access Beyond or Shareholder, or any of the
obligations of either party under any Affiliate Agreement between Access Beyond
and Shareholder or any other agreement.
5.10 Governing Law. The internal laws of the State of Georgia
(irrespective of its choice of law principles) will govern the validity of this
Voting Agreement, the construction of its terms, and the interpretation and
enforcement of the rights and duties of the parties hereto.
5.11 Counterparts. This Voting Agreement may be executed in counterparts,
each of which will be an original as regards any party whose name appears
thereon and all of which together will constitute one and the same agreement.
This Voting Agreement will become binding when one or more counterparts hereof,
individually or taken together, bear the signatures of all parties reflected
hereon as signatories. Facsimile copies with signatories of the parties to this
Voting Agreement, or their duly authorized representatives, shall be legally
binding and enforceable. All such facsimile copies are declared as originals
and, accordingly, are admissible in any jurisdiction or tribunal having
jurisdiction over any matter relating to this Voting Agreement.
5.12 Construction. The language hereof will not be construed for or
against either party. A reference to a section or exhibit will mean a section
in, or an exhibit to, this Voting Agreement, unless otherwise explicitly set
forth. The titles and headings in this Voting Agreement are for reference
purposes only and will not in any manner limit the construction of this Voting
Agreement. For the purposes of such construction, this Voting Agreement will be
considered as a whole.
5.13 ▇▇▇▇▇ Shareholder Agreement. Shareholder acknowledges that the
execution hereof by Shareholder and the execution by any other shareholders of
▇▇▇▇▇ of similar agreements in connection with the Merger, is not a violation
of, and, in particular, does not constitute a "Transfer" or "Disposition" under,
the Shareholder Agreement among the shareholders of ▇▇▇▇▇ dated April 16, 1996.
Shareholder further acknowledges and agrees that the Merger and the transactions
contemplated thereby and by this Voting Agreement do not constitute any
liquidation or redemption event applicable to the Subject Shares under the
Articles of Incorporation, Bylaws or other organizational documents of ▇▇▇▇▇, or
contracts to which such Shareholder is a party.
6
IN WITNESS WHEREOF, Access Beyond and Shareholder have caused this Voting
Agreement to be executed as of the date first written above.
ACCESS BEYOND, INC.
By:
---------------------------------------
Name:
Title:
SHAREHOLDER:
CHESTNUT CAPITAL LIMITED PARTNERSHIP
By:
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, General Partner
Address: c/▇ ▇▇▇▇▇ Microcomputer Products,
Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Address of Shareholder's counsel, if any,
for copy of Notices under Section 5.3:
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.C.
Fourteenth Floor, Lenox Towers II
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Shares of ▇▇▇▇▇ Common Stock owned as of the date hereof: 4,400,000
Shares of ▇▇▇▇▇ Series A Preferred Stock owned as of the date hereof: None
Shares of ▇▇▇▇▇ Series B Preferred Stock owned as of the date hereof: None
7
VOTING AGREEMENT Rinzai
This Voting Agreement is entered into as of July 29, 1997, by and between
Access Beyond, Inc., a Delaware corporation ("Access Beyond") and Rinzai Limited
("Shareholder").
RECITALS
A. Access Beyond and ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia
corporation ("▇▇▇▇▇"), have entered into an Agreement and Plan of Reorganization
of even date herewith (the "Merger Agreement", which term is deemed to include
all Exhibits and Schedules thereto), which provides (subject to the conditions
set forth therein) for the merger of a wholly-owned subsidiary of Access Beyond
("Newco") with and into ▇▇▇▇▇ in a reverse triangular merger (the "Merger"),
with ▇▇▇▇▇ to be the surviving corporation of the Merger. Capitalized terms used
but not otherwise defined in this Voting Agreement have the meanings ascribed to
such terms in the Merger Agreement.
B. As of the date hereof, Shareholder owns in the aggregate (including
shares held both beneficially and of record and other shares held either
beneficially or of record) the number of shares of the Common Stock, the Series
A Preferred Stock or the Series B Preferred Stock of ▇▇▇▇▇ set forth below
Shareholder's name on the signature page hereof (2,581,559 of such shares being
referred to herein as the "Subject Shares").
C. As a condition to the willingness of Access Beyond to enter into the
Merger Agreement, Access Beyond has required that Shareholder agree, and in
order to induce Access Beyond to enter into the Merger Agreement Shareholder has
agreed to enter into this Voting Agreement.
NOW, THEREFORE, the parties to this Voting Agreement, intending to be
legally bound, agree as follows:
1. RESTRICTIONS ON TRANSFER
1.1 No Disposition of or Encumbrances on Subject Shares.
(a) Shareholder hereby covenants and agrees that prior to the
Expiration Date (as defined below), Shareholder will not, directly or
indirectly, (i) offer, sell, offer to sell, contract to sell, pledge, grant any
option to purchase or otherwise dispose of or transfer (or announce any offer,
sale, offer of sale, contract of sale, or grant of any option to purchase or
other disposition or transfer of) any of the Subject Shares to any person or
entity (each, a "Person") other than Access Beyond, (ii) create, or permit to
exist any encumbrances on any of the Subject Shares or (iii) reduce its
beneficial ownership of, interest in, or risk economic relating to, any of the
Subject Shares.
1
(b) As used in this Voting Agreement, the term "Expiration Date"
shall mean the earlier of (i) the date upon which the Merger Agreement is
validly terminated, (ii) the date upon which the Merger becomes effective, or
(iii) any waiver of either any closing condition in favor of ▇▇▇▇▇ or any
obligation of Access Beyond under or any amendment of the Merger Agreement, or
the giving of any required consent of ▇▇▇▇▇ under Section 4.3 or any other
provision of the Merger Agreement unless such waiver, amendment or consent is
approved either by the Board of Directors of ▇▇▇▇▇ or the Transaction Committee
thereof established by the ▇▇▇▇▇ Board on July 28, 1997.
1.2 Transfer of Voting Rights. Shareholder covenants and agrees that,
prior to the Expiration Date, Shareholder will not deposit any of the Subject
Shares into a voting trust or grant a proxy or enter into a voting agreement
with respect to any of the Subject Shares, except as contemplated hereby.
1.3 Post-Effective Time Market Standoff.
(a) Shareholder hereby covenants and agrees that, in the event the
Merger is consummated, for a period of ninety (90) days after the
Effective Time of the Merger (the "Stand-Off Period"), Shareholder will
not, directly or indirectly, (i) offer, sell, offer to sell, contract to
sell, pledge, grant any option to purchase or otherwise, dispose of or
transfer (or announce any offer, sale, offer of sale, contract of sale or
grant of any option to purchase or other disposition or transfer of) any
of the Access Beyond Securities (as defined below) to any Person, (ii)
create or permit to exist any encumbrances on any of the Access Beyond
Securities or (iii) reduce its beneficial ownership of, interest in, or
risk relating to, any of the Access Beyond Securities.
(b) As used in this Voting Agreement, the term "Access Beyond
Securities" shall mean all shares of capital stock of Access Beyond
received by Shareholder in the Merger or otherwise acquired or held by
Shareholder. The Access Beyond Securities shall not include the shares of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ pledged to certain shareholders of ▇▇▇▇▇ pursuant to that
certain Stock Pledge Agreement of even date between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and
certain other shareholders of ▇▇▇▇▇.
2. VOTING AGREEMENTS
2.1 Pre-Termination Voting Agreement. Shareholder hereby agrees that,
prior to the Expiration Date, at any meeting of the shareholders of ▇▇▇▇▇,
however called, and in any written action by consent of shareholders of ▇▇▇▇▇,
unless otherwise directed in writing by Access Beyond, Shareholder shall vote
the Subject Shares:
(i) in favor of the Merger, the execution and delivery by ▇▇▇▇▇ of
the Merger Agreement and the adoption and approval of the terms thereof
and in favor of each of the
2
other actions contemplated by the Merger Agreement and any action required
in furtherance hereof and thereof;
(ii) against any Acquisition Proposal (other than the Merger) and
against any action or agreement that would result in a breach of any
covenant or obligation of ▇▇▇▇▇ in the Merger Agreement; and
(iii) against any other action which is intended, or could
reasonably be expected to, materially impede, interfere with, delay,
postpone, or adversely affect the Merger or any of the other transactions
contemplated by the Merger Agreement.
Prior to the Expiration Date, Shareholder shall not enter into any agreement or
understanding with any Person to vote or give instructions in any manner
inconsistent with clause "(i)", "(ii)", or "(iii)" of the preceding sentence.
2.2 Proxy. Contemporaneously with the execution of this Voting Agreement,
Shareholder delivers to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ a proxy in the form attached hereto as
Exhibit A (the "Proxy").
3. WAIVER OF APPRAISAL RIGHTS
Shareholder hereby irrevocably waives and agrees with respect to the
Subject Shares not to assert any and all rights of appraisal or dissenters'
rights that Shareholder may have or hereafter acquire pursuant to Article 13 of
the Georgia Business Corporation Code or any other applicable laws in connection
with the Merger.
4. NOTICE OF SHAREHOLDER MEETINGS AND PROPOSED CONSENTS
For the purpose of effectively carrying out and furthering the intent of
this Voting Agreement and allowing Access Beyond to exercise its rights
hereunder, Shareholder agrees to give Access Beyond prompt written notice of any
meeting of the shareholders of ▇▇▇▇▇ or proposed written consent of the
shareholders of ▇▇▇▇▇ with respect to the matters covered by the Proxy (which
notice shall, in any event be given in a manner to be received not later than
two (2) days before such meeting or consent). Access Beyond acknowledges that
the obligations of this Section 4 will be satisfied with respect to a given
meeting or proposed written consent once it has received notice with respect to
such meeting or proposed written consent from any of Shareholder, ▇▇▇▇▇ or any
other shareholder of ▇▇▇▇▇ executing a similar voting agreement.
5. MISCELLANEOUS
5.1 Indemnification. Shareholder shall hold harmless and indemnify Access
Beyond from and against any and all claims, demands, actions, losses, costs,
damages, liabilities and expenses including, without limitation, attorney's fees
(collectively "Damages") (regardless of
3
whether or not such Damages relate to a third-party claim) which are incurred by
Access Beyond to the extent that such Damages arise from any breach of any
covenant or obligation of Shareholder contained herein, excluding any action or
omission of the holder of the Proxy.
5.2 Expenses. All costs and expenses incurred in connection with the
transactions contemplated by this Voting Agreement shall be paid by the party
incurring such costs and expenses; provided, however, that the Shareholder's
legal costs and expenses shall be promptly paid by ▇▇▇▇▇.
5.3 Notices. All notices, approvals, consents, requests and other
communications that any party is required or elects to give hereunder shall be
in writing and shall be deemed to have been given (a) upon personal delivery
thereof, including by appropriate international courier service, five (5) days
after delivery to the courier or, if earlier, upon delivery against a signed
receipt therefor or (b) upon transmission by facsimile or telecopier, which
transmission is confirmed, in either case addressed to the party to be notified
at the address set forth below or at such other address as such party shall have
notified the other parties hereto, by notice given in conformity with this
Section 5.3:
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Shareholder:
Rinzai Limited
▇/▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Attention: President
Facsimile: ▇▇▇ ▇▇ ▇▇▇-▇▇▇▇
4
with a copy to:
Jackson, Tufts, ▇▇▇▇ & Black
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 5.3.
5.4 Severability. Any term or provision of this Voting Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Voting Agreement or affecting the validity or enforceability of any of the terms
or provisions of this Voting Agreement in any other jurisdiction. If any
provision of this Voting Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
5.5 Entire Agreement. This Voting Agreement and any documents delivered by
the parties in connection herewith constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings between the parties with respect thereto.
5.6 Amendment and Waivers. Any term or provision of this Voting Agreement
may be amended, and the observance of any term of this Voting Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only by a writing signed by the parties to be bound thereby. The
waiver by a party of any breach hereof or default in the performance hereof will
not be deemed to constitute a waiver of any other default or any succeeding
breach or default.
5.7 Assignment, Binding Effect. Except as provided herein, neither this
Voting Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by either of the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other party. Subject to the
preceding sentence, this Voting Agreement shall be binding upon and shall inure
to the benefit of (i) Shareholder and its heirs, successor and assigns and (ii)
Access Beyond and its successors and assigns.
5.8 Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any of the provisions of this Voting Agreement are
not performed in accordance with its specific terms or was otherwise breached.
It is accordingly agreed that Access Beyond shall be entitled to an injunction
or injunctions to prevent breaches of this Voting Agreement and to enforce
specifically the terms and provisions hereof, this being in addition to any
other remedy to which Access Beyond is entitled at law or in equity.
5
5.9 Other Agreements. Nothing in this Voting Agreement shall limit any of
the rights or remedies of Access Beyond or Shareholder, or any of the
obligations of either party under any Affiliate Agreement between Access Beyond
and Shareholder or any other agreement.
5.10 Governing Law. The internal laws of the State of Georgia
(irrespective of its choice of law principles) will govern the validity of this
Voting Agreement, the construction of its terms, and the interpretation and
enforcement of the rights and duties of the parties hereto.
5.11 Counterparts. This Voting Agreement may be executed in counterparts,
each of which will be an original as regards any party whose name appears
thereon and all of which together will constitute one and the same agreement.
This Voting Agreement will become binding when one or more counterparts hereof,
individually or taken together, bear the signatures of all parties reflected
hereon as signatories. Facsimile copies with signatories of the parties to this
Voting Agreement, or their duly authorized representatives, shall be legally
binding and enforceable. All such facsimile copies are declared as originals
and, accordingly, are admissible in any jurisdiction or tribunal having
jurisdiction over any matter relating to this Voting Agreement.
5.12 Construction. The language hereof will not be construed for or
against either party. A reference to a section or exhibit will mean a section
in, or an exhibit to, this Voting Agreement, unless otherwise explicitly set
forth. The titles and headings in this Voting Agreement are for reference
purposes only and will not in any manner limit the construction of this Voting
Agreement. For the purposes of such construction, this Voting Agreement will be
considered as a whole.
5.13 ▇▇▇▇▇ Shareholder Agreement. Shareholder acknowledges that the
execution hereof by Shareholder and the execution by any other shareholders of
▇▇▇▇▇ of similar agreements in connection with the Merger, is not a violation
of, and, in particular, does not constitute a "Transfer" or "Disposition" under,
the Shareholder Agreement among the shareholders of ▇▇▇▇▇ dated April 16, 1996.
Shareholder further acknowledges and agrees that the Merger and the transactions
contemplated thereby and by this Voting Agreement do not constitute any
liquidation or redemption event applicable to the Subject Shares under the
Articles of Incorporation, Bylaws or other organizational documents of ▇▇▇▇▇, or
contracts to which such Shareholder is a party.
[EXECUTION ON THE FOLLOWING PAGE]
6
IN WITNESS WHEREOF, Access Beyond and Shareholder have caused this Voting
Agreement to be executed as of the date first written above.
ACCESS BEYOND, INC.
By:
---------------------------------------
Name:
Title:
SHAREHOLDER:
RINZAI LIMITED
By:
---------------------------------------
Name: , President
-----------------------
Address: ▇/▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Facsimile: ▇▇▇ ▇▇ ▇▇▇-▇▇▇▇
Address of Shareholder's counsel, if any,
for copy of Notices under Section 5.3:
Jackson, Tufts, ▇▇▇▇ & Black
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Shares of ▇▇▇▇▇ Common Stock owned as of the date hereof: None
Shares of ▇▇▇▇▇ Series A Preferred Stock owned as of the date hereof: 2,817,500
Shares of ▇▇▇▇▇ Series B Preferred Stock owned as of the date hereof: None
7
EXHIBIT A
FORM OF IRREVOCABLE PROXY
The undersigned shareholder of ▇▇▇▇▇ Microcomputer Products, Inc., a
Georgia corporation ("▇▇▇▇▇"), hereby irrevocably (to the fullest extent
permitted by law) appoints and constitutes ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ the attorney and
proxy of the undersigned with full power of substitution and resubstitution, to
the full extent of the undersigned's rights with respect to __________ shares of
capital stock of ▇▇▇▇▇ owned by the undersigned as of the date of this proxy,
which shares are specified below. (The number of shares of the capital stock of
▇▇▇▇▇ referred to above are referred to as the "Shares"). Upon the execution
hereof, all prior proxies given by the undersigned with respect to any of the
Shares are hereby revoked, and no subsequent proxies will be given with respect
to any of the Shares.
This proxy is irrevocable, is coupled with an interest and is
granted in connection with the Voting Agreement, dated as of the date hereof,
between Access Beyond, Inc. ("Access Beyond") and the undersigned (the "Voting
Agreement"), and is granted in consideration of Access Beyond entering into the
Agreement and Plan of Reorganization, dated as of the date hereof, between
Access Beyond and ▇▇▇▇▇ (the "Merger Agreement"). Capitalized terms used but not
otherwise defined in this proxy have the meanings ascribed to such terms in the
Voting Agreement.
The attorney and proxy named above are hereby empowered, and shall
exercise this proxy, to vote the Shares at any time prior to the Expiration Date
at any meeting of the shareholders of ▇▇▇▇▇, however called, or in any written
action by consent of shareholders of ▇▇▇▇▇:
(i) in favor of the Merger, the execution and delivery by ▇▇▇▇▇ of
the Merger Agreement and the adoption and approval of the terms thereof
and in favor of each of the other actions contemplated by the Merger
Agreement and any action required in furtherance hereof and thereof; and
(ii) against any Acquisition Proposal (other than the Merger) and
against any action or agreement that would result in a breach of any
covenant or obligation of ▇▇▇▇▇ in the Merger Agreement.
The undersigned Shareholder may vote the Shares on all other
matters. This proxy shall be binding upon the heirs, successors and assigns of
the undersigned (including any transferee of any of the Shares).
Dated:_______________, 1997
--------------------------------------------
Name:
Number of Shares of ▇▇▇▇▇
Common Stock owned as of
the date of this Proxy:_____________________
Number of Shares of ▇▇▇▇▇
Series A Preferred Stock owned
as of the date of this Proxy:_______________
Number of Shares of ▇▇▇▇▇
Series B Preferred Stock owned
as of the date of this Proxy:_______________
8
VOTING AGREEMENT
This Voting Agreement is entered into as of July 29, 1997, by and between
Access Beyond, Inc., a Delaware corporation ("Access Beyond") and Vulcan
Ventures Incorporated, a Washington corporation ("Shareholder").
RECITALS
A. Access Beyond and ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia
corporation ("▇▇▇▇▇"), have entered into an Agreement and Plan of Reorganization
of even date herewith (as amended from time to time, the "Merger Agreement"),
which provides (subject to the conditions set forth therein) for the merger of a
wholly-owned subsidiary of Access Beyond ("Newco") with and into ▇▇▇▇▇ in a
reverse triangular merger (the "Merger"), with ▇▇▇▇▇ to be the surviving
corporation of the Merger. Capitalized terms used but not otherwise defined in
this Voting Agreement have the meanings ascribed to such terms in the Merger
Agreement.
B. As of the date hereof, Shareholder owns in the aggregate (including
shares held both beneficially and of record and other shares held either
beneficially or of record) the number of shares of the Common Stock, the Series
A Preferred Stock or the Series B Preferred Stock of ▇▇▇▇▇ set forth below
Shareholder's name on the signature page hereof and the Access Beyond Securities
(as defined herein) (all such shares, together with any shares of the Common
Stock, the Series A Preferred Stock, the Series B Preferred Stock or other
shares of capital stock of ▇▇▇▇▇ that may hereafter be acquired by Shareholder,
being referred to herein as the "Subject Shares").
C. As a condition to the willingness of Access Beyond to enter into the
Merger Agreement, Access Beyond has required that Shareholder agree, and in
order to induce Access Beyond to enter into the Merger Agreement Shareholder has
agreed to enter into this Voting Agreement.
NOW, THEREFORE, the parties to this Voting Agreement, intending to be
legally bound, agree as follows:
1. RESTRICTIONS ON TRANSFER
1.1 No Disposition of or Encumbrances on Subject Shares.
(a) Shareholder hereby covenants and agrees that prior to the
Expiration Date (as defined below), Shareholder will not, directly or
indirectly, (i) offer, sell, offer to sell, contract to sell, pledge, grant any
option to purchase or otherwise dispose of or transfer (or announce any offer,
sale, offer of sale, contract of sale, or grant of any option to purchase or
other disposition or transfer of) any of the Subject Shares to any person or
entity (each, a "Person") other than Access Beyond,
1
(ii) create, or permit to exist any encumbrances on any of the Subject Shares or
(iii) reduce its beneficial ownership of, interest in, or risk relating to, any
of the Subject Shares.
(b) As used in this Voting Agreement, the term "Expiration Date"
shall mean the earlier of the date upon which the Merger Agreement is validly
terminated or the date upon which the Merger becomes effective.
1.2 Transfer of Voting Rights. Shareholder covenants and agrees that,
prior to the Expiration Date, Shareholder will not deposit any of the Subject
Shares into a voting trust or grant a proxy or enter into a voting agreement
with respect to any of the Subject Shares.
1.3 Post-Effective Time Market Standoff.
(a) Shareholder hereby covenants and agrees that in the event the
Merger is consummated, for a period of ninety (90) days after the
Effective Time of the Merger (the "Stand-Off Period"), Shareholder will
not, directly or indirectly, (i) offer, sell, offer to sell, contract to
sell, pledge, grant any option to purchase or otherwise, dispose of or
transfer (or announce any offer, sale, offer of sale, contract of sale or
grant of any option to purchase or other disposition or transfer of) any
of the Access Beyond Securities (as defined below) to any Person, (ii)
create or permit to exist any encumbrances on any of the Access Beyond
Securities or (iii) reduce its beneficial ownership of, interest in, or
risk relating to, any of the Access Beyond Securities.
(b) As used in this Voting Agreement, the term "Access Beyond
Securities" shall mean all shares of capital stock of Access Beyond
received by Shareholder in the Merger or otherwise acquired or held by
Shareholder.
2. VOTING AGREEMENTS
2.1 Pre-Termination Voting Agreement. Shareholder hereby agrees that,
prior to the Expiration Date, at any meeting of the shareholders of ▇▇▇▇▇,
however called, and in any written action by consent of shareholders of ▇▇▇▇▇,
unless otherwise directed in writing by Access Beyond, Shareholder shall vote
the Subject Shares:
(i) in favor of the Merger, the execution and delivery by ▇▇▇▇▇ of
the Merger Agreement and the adoption and approval of the terms thereof
and in favor of each of the other actions contemplated by the Merger
Agreement and any action required in furtherance hereof and thereof;
(ii) against any Acquisition Proposal (other than the Merger) and
against any action or agreement that would result in a breach of any
covenant or obligation of ▇▇▇▇▇ in the Merger Agreement; and
2
(iii) against any other action which is intended, or could
reasonably be expected to, materially impede, interfere with, delay,
postpone, or adversely affect the Merger or any of the other transactions
contemplated by the Merger Agreement.
Prior to the earlier to occur of the valid termination of the Merger Agreement
or the Effective Time, Shareholder shall not enter into any agreement or
understanding with any Person to vote or give instructions in any manner
inconsistent with clause "(i)", "(ii)", or "(iii)" of the preceding sentence.
2.2 Proxy. Contemporaneously with the execution of this Voting Agreement,
Shareholder delivers to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ a proxy in the form attached hereto as
Exhibit A (the "Proxy").
3. WAIVER OF APPRAISAL RIGHTS
Shareholder hereby irrevocably waives and agrees not to assert any and all
rights of appraisal or dissenters' rights that Shareholder may have or hereafter
acquire pursuant to Article 13 of the Georgia Business Corporation Code or any
other applicable laws in connection with the Merger.
4. NOTICE OF SHAREHOLDER MEETINGS AND PROPOSED CONSENTS
For the purpose of effectively carrying out and furthering the intent of
this Voting Agreement and allowing Access Beyond to exercise its rights
hereunder, Shareholder agrees to give Access Beyond prompt written notice of any
meeting of the shareholders of ▇▇▇▇▇ or proposed written consent of the
shareholders of ▇▇▇▇▇ with respect to the matters covered by the Proxy (which
notice shall, in any event be given in a manner to be received not later than
two (2) days before such meeting or consent action). Access Beyond acknowledges
that the obligations of this Section 4 will be satisfied with respect to a given
meeting or proposed written consent once it has received notice with respect to
such meeting or proposed written consent from any of Shareholder, ▇▇▇▇▇ or any
other shareholder of ▇▇▇▇▇ executing a similar voting agreement.
5. MISCELLANEOUS
5.1 Indemnification. Shareholder shall hold harmless and indemnify Access
Beyond from and against any and all claims, demands, actions, losses, costs,
damages, liabilities and expenses including, without limitation, attorney's fees
(collectively "Damages") (regardless of whether or not such Damages relate to a
third-party claim) which are incurred by Access Beyond to the extent that such
Damages arise from any breach of any covenant or obligation of Shareholder
contained herein.
5.2 Expenses. All costs and expenses incurred in connection with the
transactions contemplated by this Voting Agreement shall be paid by the party
incurring such costs and expenses; provided, however, that the Shareholders
legal costs and expenses shall be promptly paid by ▇▇▇▇▇.
3
5.3 Notices. All notices, approvals, consents, requests and other
communications that any party is required or elects to give hereunder shall be
in writing and shall be deemed to have been given (a) upon personal delivery
thereof, including by appropriate courier service, five (5) days after delivery
to the courier or, if earlier, upon delivery against a signed receipt therefor
or (b) upon transmission by facsimile or telecopier, which transmission is
confirmed, in either case addressed to the party to be notified at the address
set forth below or at such other address as such party shall have notified the
other parties hereto, by notice given in conformity with this Section 5.3:
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Shareholder:
At the address set forth below Shareholder's signature
on the signature page hereto
with a copy to:
Counsel for Shareholder, if any, at the address shown on
the signature page hereto
Any party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 5.3.
5.4 Severability. Any term or provision of this Voting Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Voting Agreement or affecting the validity or enforceability of any of the terms
or provisions of this Voting Agreement in any other jurisdiction. If any
provision of this Voting Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
4
5.5 Entire Agreement. This Voting Agreement and any documents delivered by
the parties in connection herewith constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings between the parties with respect thereto.
5.6 Amendment and Waivers. Any term or provision of this Voting Agreement
may be amended, and the observance of any term of this Voting Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only by a writing signed by the parties to be bound thereby. The
waiver by a party of any breach hereof or default in the performance hereof will
not be deemed to constitute a waiver of any other default or any succeeding
breach or default.
5.7 Assignment, Binding Effect. Except as provided herein, neither this
Voting Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by either of the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other party. Subject to the
preceding sentence, this Voting Agreement shall be binding upon and shall inure
to the benefit of (i) Shareholder and his heirs, successor and assigns and (ii)
Access Beyond and its successors and assigns.
5.8 Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any of the provisions of this Voting Agreement was
not performed in accordance with its specific terms or are otherwise breached.
It is accordingly agreed that Access Beyond shall be entitled to an injunction
or injunctions to prevent breaches of this Voting Agreement and to enforce
specifically the terms and provisions hereof, this being in addition to any
other remedy to which Access Beyond is entitled at law or in equity.
5.9 Other Agreements. Nothing in this Voting Agreement shall limit any of
the rights or remedies of Access Beyond or any of the obligations of Shareholder
under any Affiliate Agreement between Access Beyond and Shareholder or any other
agreement.
5.10 Governing Law. The internal laws of the State of Georgia
(irrespective of its choice of laprinciples) will govern the validity of this
Voting Agreement, the construction of its terms, athe interpretation and
enforcement of the rights and duties of the parties hereto.
5.11 Counterparts. This Voting Agreement may be executed in counterparts,
each of which will be an original as regards any party whose name appears
thereon and all of which together will constitute one and the same agreement.
This Voting Agreement will become binding when one or more counterparts hereof,
individually or taken together, bear the signatures of all parties reflected
hereon as signatories. Facsimile copies with signatories of the parties to this
Voting Agreement, or their duly authorized representatives, shall be legally
binding and enforceable. All such facsimile copies are declared as originals
and, accordingly, are admissible in any jurisdiction or tribunal having
jurisdiction over any matter relating to this Voting Agreement.
5
5.12 Construction. The language hereof will not be construed for or
against either party. A reference to a section or exhibit will mean a section
in, or an exhibit to, this Voting Agreement, unless otherwise explicitly set
forth. The titles and headings in this Voting Agreement are for reference
purposes only and will not in any manner limit the construction of this Voting
Agreement. For the purposes of such construction, this Voting Agreement will be
considered as a whole.
5.13 ▇▇▇▇▇ Shareholder Agreement. Shareholder acknowledges that the
execution hereof by Shareholder and the execution by any other shareholders of
▇▇▇▇▇ of similar agreements in connection with the Merger, is not a violation
of, and, in particular, does not constitute a "Transfer" or "Disposition" under,
the Shareholder Agreement among the shareholders of ▇▇▇▇▇ dated April 16, 1996.
Shareholder further acknowledges and agrees that the Merger Agreement and the
transactions contemplated thereby and by this Voting Agreement do not constitute
any liquidation or redemption event applicable to the Subject Shares under the
Articles of Incorporation, Bylaws or other organizational documents of ▇▇▇▇▇, or
contracts to which such Shareholder is a party.
IN WITNESS WHEREOF, Access Beyond and Shareholder have caused this Voting
Agreement to be executed as of the date first written above.
ACCESS BEYOND, INC.
By:
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
6
SHAREHOLDER:
VULCAN VENTURES INCORPORATED
By:
---------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Address of Shareholder's counsel, if any,
for copy of Notices under Section 5.3:
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ Pepper & Shefelman
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Shares of ▇▇▇▇▇ Common Stock owned as of the date hereof: None
Shares of ▇▇▇▇▇ Series A Preferred Stock owned as of the date hereof: None
Shares of ▇▇▇▇▇ Series B Preferred Stock owned as of the date hereof: 263,113
7
EXHIBIT A
FORM OF IRREVOCABLE PROXY
The undersigned shareholder of ▇▇▇▇▇ Microcomputer Products, Inc., a
Georgia corporation ("▇▇▇▇▇"), hereby irrevocably (to the fullest extent
permitted by law) appoints and constitutes ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ the attorney and
proxy of the undersigned with full power of substitution and resubstitution, to
the full extent of the undersigned's rights with respect to (i) the shares of
capital stock of ▇▇▇▇▇ owned by the undersigned as of the date of this proxy,
which shares are specified below, and (ii) any and all other shares of capital
stock of ▇▇▇▇▇ which the undersigned may acquire after the date hereof. (The
shares of the capital stock of ▇▇▇▇▇ referred to in clauses (i) and (ii) of the
immediately preceding sentence are collectively referred to as the "Shares").
Upon the execution hereof, all prior proxies given by the undersigned with
respect to any of the Shares are hereby revoked, and no subsequent proxies will
be given with respect to any of the Shares.
This proxy is irrevocable, is coupled with an interest and is
granted in connection with the Voting Agreement, dated as of the date hereof,
between Access Beyond and the undersigned (the "Voting Agreement"), and is
granted in consideration of Access beyond entering into the Agreement and Plan
of Reorganization, dated as of the date hereof, between Access Beyond and ▇▇▇▇▇
(the "Merger Agreement"). Capitalized terms used but not otherwise defined in
this proxy have the meanings ascribed to such terms in the Voting Agreement.
The attorney and proxy named above are hereby empowered, and shall
exercise this proxy, to vote the Shares at any time prior to the Expiration Date
at any meeting of the shareholders of ▇▇▇▇▇, however called, or in any written
action by consent of shareholders of ▇▇▇▇▇:
(i) in favor of the Merger, the execution and delivery by ▇▇▇▇▇ of
the Merger Agreement and the adoption and approval of the terms thereof
and in favor of each of the other actions contemplated by the Merger
Agreement and any action required in furtherance hereof and thereof; and
(ii) against any Acquisition Proposal (other than the Merger) and
against any action or agreement that would result in a breach of any
covenant or obligation of ▇▇▇▇▇ in the Merger Agreement. The undersigned
Shareholder may vote the Shares on all other matters.
This proxy shall be binding upon the heirs, successors and assigns
of the undersigned (including any transferee of any of the Shares).
Dated:_______________, 1997
--------------------------------------------
VULCAN VENTURES INCORPORATED
Number of Shares of ▇▇▇▇▇
Common Stock owned as of
the date of this Proxy: None
Number of Shares of ▇▇▇▇▇
Series A Preferred Stock owned
as of the date of this Proxy: None
Number of Shares of ▇▇▇▇▇
Series B Preferred Stock owned
as of the date of this Proxy: 263,113
8
MARKET STAND-OFF AGREEMENT
This Market Stand-Off Agreement (this "Agreement") is entered into as of
____________, 1997 by Access Beyond, Inc., Inc., a Delaware corporation ("Access
Beyond") and _________________________________ ("Shareholder").
RECITALS
A. Access Beyond and ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia
corporation ("▇▇▇▇▇"), are entering into an Agreement and Plan of Reorganization
of even date herewith (as amended from time to time, the "Merger Agreement"),
which provides (subject to the conditions set forth therein) for the merger of a
wholly owned subsidiary of Access Beyond ("Newco") with and into ▇▇▇▇▇ in a
reverse triangular merger (the "Merger"), with ▇▇▇▇▇ to be the surviving
corporation of the Merger. Capitalized terms used but not otherwise defined in
this Agreement have the meanings ascribed to such term in the Merger Agreement.
B. As of the date hereof, Shareholder owns in the aggregate (including
shares held both beneficially and of record and other shares held either
beneficially or of record) the number of shares of the Common Stock, the Series
A Preferred Stock and the Series B Preferred Stock of ▇▇▇▇▇ set forth below
Shareholder's name on the signature page hereof (all such shares, together with
any shares of the Common Stock, the Series A Preferred Stock, the Series B
Preferred Stock or other shares of capital stock of ▇▇▇▇▇ that may hereafter be
acquired by Shareholder, being referred to herein as the "Subject Shares").
C. As a condition to closing the Merger and other transactions
contemplated by the Merger Agreement, Access Beyond has required that
Shareholder agree to enter into this Agreement.
Now, therefore, the parties to this Agreement, intending to be legally
bound, agree as follows:
1. MARKET STAND-OFF
Shareholder hereby covenants and agrees that, prior to ninety (90)
days after the Effective Time of the Merger (the "Stand-Off Period"),
Shareholder will not, directly or indirectly, (i) offer, sell, offer to sell,
contract to sell, pledge, grant any option to purchase or otherwise dispose of
or transfer (or announce any offer, sale, offer of sale, contract of sale or
grant of any option to purchase or other disposition or transfer of) any of the
Access Beyond Securities (as defined below) to any Person, (ii) create or permit
to exist any encumbrance on any of the Access Beyond Securities or (iii) reduce
its beneficial ownership of, interest in, or risk relating to, any of the Access
Beyond Securities. As used in this Agreement, the term "Access Beyond
Securities" shall mean all shares of capital stock of Access Beyond received by
Shareholder in the Merger or otherwise acquired or held by Shareholder.
2. MISCELLANEOUS
2.1 Severability. Any term or provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
2.2 Entire Agreement. This Agreement and any documents delivered by the
parties in connection herewith constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and supersedes all
prior agreements and understandings between the parties with respect thereto.
2.3 Notices. All notices, approvals, consents, requests and other
communications that any party is required or elects to give hereunder shall be
in writing and shall be deemed to have been given (a) upon personal delivery
thereof, including by appropriate international courier service, five (5) days
after delivery to the courier or, if earlier, upon delivery against a signed
receipt therefor or (b) upon transmission by facsimile or telecopier, which
transmission is confirmed, in either case addressed to the party to be notified
at the address set forth below or at such other address as such party shall have
notified the other parties hereto, by notice given in conformity with this
Section 2.3:
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Shareholder:
At the address set forth below Shareholder's signature
on the signature page hereto
with a copy to:
Counsel for Shareholder, if any, at the address shown on
the signature page hereto
Any party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 2.3.
2.4 Amendment and Waivers. Any term or provision of this Agreement may be
amended, and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only by a writing signed by the parties to be bound thereby. The
waiver by a party of any breach hereof or default in the performance hereof will
not be deemed to constitute a waiver of any other default or any succeeding
breach or default.
2.5 Assignment; Binding Effect. Except as provided herein, neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by either of the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other party. Subject to the
preceding sentence, this Agreement shall be binding upon and shall inure to the
benefit of (i) Shareholder and his heirs, successors and assigns, and (ii)
Access Beyond and its successors and assigns.
2.6 Other Agreements. Nothing in this Agreement shall limit any of the
rights or remedies of Access Beyond of any of the obligations of Shareholder
under any Affiliate Agreement between Access Beyond and Shareholder or any other
instrument.
2.7 Governing Law. The internal laws of the State of Georgia (irrespective
of its choice of law principles) will govern the validity of this Agreement, the
construction of its terms, and the interpretation and enforcement of the rights
and duties of the parties hereto.
2.8 Counterparts. This Agreement may be executed in counterparts, each of
which will be an original as regards any party whose name appears thereon and
all of which together will constitute one and the same agreement. This Agreement
will become binding when one or more counterparts hereof, individually or taken
together, bear the signature of all parties reflected hereon as signatories.
2.9 ▇▇▇▇▇ Shareholder Agreement. Shareholder acknowledges that the
execution hereof by Shareholder and the execution by any other shareholders of
▇▇▇▇▇ of similar agreements in connection with the Merger, is not a violation
of, and, in particular, does not constitute a "transfer" under, the Shareholder
Agreement among the shareholders of ▇▇▇▇▇ dated April 16, 1996. Shareholder
further acknowledges and agrees that the Merger and the transactions
contemplated thereby and by this Market Stand-Off Agreement do not constitute
any liquidation or redemption event applicable to the Subject Shares under the
Articles of Incorporation, Bylaws or other organizational documents of ▇▇▇▇▇, or
contracts to which such Shareholder is a party.
IN WITNESS WHEREOF, Access Beyond and Shareholder have caused this
Market Stand-Off Agreement to be executed as of the date first written above.
ACCESS BEYOND, INC.
By:
-----------------------------------------
Name:
Title:
SHAREHOLDER:
--------------------------------------------
Name:
Address of Shareholder's counsel, if any,
for copy of Notices under Section 5.3:
____________________________________________
____________________________________________
____________________________________________
____________________________________________
Facsimile:__________________________________
Number of Shares of ▇▇▇▇▇
Common Stock owned as of
the date hereof: ___________________________
Number of Shares of ▇▇▇▇▇
Series A Preferred Stock owned
as of the date hereof: _____________________
Number of Shares of ▇▇▇▇▇
Series B Preferred Stock owned
as of the date hereof: _____________________
▇▇▇▇▇ AFFILIATE AGREEMENT
This ▇▇▇▇▇ Affiliate Agreement (this "Affiliate Agreement") is made and
entered into as of July 29, 1997 (the "Effective Date") among Access Beyond,
Inc., a Delaware corporation ("Access Beyond"), ▇▇▇▇▇ Microcomputer Products,
Inc., a Georgia corporation ("▇▇▇▇▇") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ("Shareholder") who is
an affiliate of ▇▇▇▇▇.
RECITALS
A. This Affiliate Agreement is entered into pursuant to that certain
Agreement and Plan of Reorganization dated as of July 29, 1997 between Access
Beyond and ▇▇▇▇▇ (as such may be amended the "Merger Agreement") which provides
(subject to the conditions set forth therein) for the merger of a wholly owned
subsidiary of Access Beyond ("Newco") with and into ▇▇▇▇▇ in a reverse
triangular merger (the "Merger"), with ▇▇▇▇▇ to be the surviving corporation of
the Merger, all pursuant to the terms and conditions of the Merger Agreement and
the Agreement of Merger to be entered into between Newco and ▇▇▇▇▇ in the form
attached to the Merger Agreement (the "Agreement of Merger"). The Merger
Agreement and the Agreement of Merger are collectively referred to herein as the
"Merger Agreements." Capitalized terms used but not otherwise defined in this
Affiliate Agreement have the meanings ascribed to such terms in the Merger
Agreement.
B. The Merger Agreements provide that, in the Merger, the shares of ▇▇▇▇▇
Common Stock and shares of ▇▇▇▇▇ Series A Preferred Stock that are issued and
outstanding at the Effective Time of the Merger will be converted into shares of
Access Beyond Common Stock and the shares of ▇▇▇▇▇ Series B Preferred Stock that
are issued and outstanding at the Effective Time of the Merger will be converted
into shares of Access Beyond Series A Stock, all as more particularly set forth
in the Merger Agreement
C. Shareholder understands that Shareholder is deemed an "affiliate" of
▇▇▇▇▇ within the meaning of the Securities Act of 1933, as amended (the "1933
Act"), and that any shares of Access Beyond capital stock acquired by the
Shareholder in the Merger may be disposed of only in conformity with the
limitations described herein.
A G R E E M E N T
1. Tax Treatment, Reliance. Shareholder understands and agrees that it is
intended that the Merger will be treated as a tax-free reorganization for
federal income tax purposes and that such treatment requires that a sufficient
number of former stockholders of ▇▇▇▇▇ maintain a meaningful continuing equity
ownership interest in Access Beyond after the Merger. Shareholder understands
that the representations, warranties and covenants of Shareholder set forth
herein will be relied upon by ▇▇▇▇▇ and Access Beyond and their respective
counsel and accounting firms and by ▇▇▇▇▇' stockholders. Shareholder will rely
on Shareholder's own tax advisers as to the tax attributes of the Merger to
Shareholder and understands that neither Access Beyond, nor Access Beyond's
counsel, ▇▇▇▇▇ or ▇▇▇▇▇' counsel has guaranteed nor will guarantee to
Shareholder that
1
the Merger will be a tax-free reorganization, nor shall any of them have any
liability to Shareholder as a result of issuing any opinion in respect thereof
that may be required in connection with any registration statement under the
1933 Act.
2. Representations, Warranties, and Covenants of Shareholder. Shareholder
represents, warrants and covenants as follows.
(a) Authority; Affiliate Status. Shareholder has all requisite
right, power, legal capacity and authority to execute, deliver and perform this
Affiliate Agreement and to perform its obligations hereunder. Shareholder
further understands and agrees that Shareholder is deemed to be an "affiliate"
of ▇▇▇▇▇ within the meaning of the 1933 Act and, in particular, Rule 145
promulgated under the 1933 Act ("Rule 145"),
(b) ▇▇▇▇▇ Securities Owned. Attachment 1 hereto sets forth all
shares of ▇▇▇▇▇ capital stock and any other securities of ▇▇▇▇▇ owned by
Shareholder, including all securities of ▇▇▇▇▇ as to which Shareholder has sole
or shared voting or investment power, and all rights, options and warrants to
acquire shares of capital stock or other securities of ▇▇▇▇▇ granted to or held
by Shareholder (such shares of ▇▇▇▇▇ capital stock, other securities of ▇▇▇▇▇
and rights, options and warrants to acquire shares of ▇▇▇▇▇ capital stock and
other securities of ▇▇▇▇▇ are hereinafter collectively referred to as "▇▇▇▇▇
Securities"). As used herein, the term "Expiration Date" means the earliest to
occur of (i) the closing, consummation and effectiveness of the Merger, or (ii)
such time as the Merger Agreement may be terminated in accordance with its
terms.
(c) New ▇▇▇▇▇ Securities. As used herein, the term "New ▇▇▇▇▇
Securities" means, collectively, any and all shares of ▇▇▇▇▇ capital stock,
other securities of ▇▇▇▇▇ and rights, options and warrants to acquire shares of
▇▇▇▇▇ capital stock and other securities of ▇▇▇▇▇ that Shareholder may purchase
or otherwise acquire any interest in (whether of record or beneficially), on and
after the Effective Date of this Affiliate Agreement and prior to the Expiration
Date. All New ▇▇▇▇▇ Securities will be subject to the terms of this Affiliate
Agreement to the same extent and in the same manner as if they were ▇▇▇▇▇
Securities.
(d) Merger Securities. As used herein, the term "Merger Securities"
means, collectively, all shares of Access Beyond Common Stock, and Access Beyond
Series A Stock that are or may be issued by Access Beyond in connection with the
Merger or the transactions contemplated by the Merger Agreements, or to any
former holder of ▇▇▇▇▇ options, warrants or rights to acquire shares of ▇▇▇▇▇
Common Stock, and any securities that may be paid as a dividend or otherwise
distributed thereon or with respect thereto or issued or delivered in exchange
or substitution therefor or upon conversion thereof.
(e) Transfer Restrictions on Merger Securities. Shareholder has been
advised that the issuance of the shares of Access Beyond Common Stock and Access
Beyond Series A Stock in connection with the Merger is expected to be
effectuated pursuant to a Registration Statement on Form S-4 under the 1933 Act,
and that the provisions of Rule 145 will limit
2
Shareholder's resales of such Merger Securities. Shareholder accordingly agrees
not to sell, transfer, exchange, pledge, or otherwise dispose of, or make any
offer or agreement relating to, any of the Merger Securities and/or any option,
right or other interest with respect to any Merger Securities that Shareholder
may acquire, unless: (i) such transaction is permitted pursuant to Rules 145(c)
and 145(d) under the 1933 Act; or (ii) legal counsel representing Shareholder,
which counsel is reasonably satisfactory to Access Beyond, shall have advised
Access Beyond in a written opinion letter reasonably satisfactory to Access
Beyond and Access Beyond's legal counsel, and upon which Access Beyond and its
legal counsel may rely, that no registration under the 1933 Act would be
required in connection with the proposed sale, offer, exchange, pledge or other
disposition of Merger Securities by Shareholder, or (iii) a registration
statement under the 1933 Act covering the Merger Securities proposed to be sold,
transferred, exchanged, pledged or otherwise dispose of, describing the manner
and terms of the proposed sale, transfer, exchange, pledge or other disposition,
and containing a current prospectus, shall have been filed with the Securities
and Exchange Commission ("SEC") and been declared effective by the SEC under the
1933 Act, or (iv) an authorized representative of the SEC shall have rendered
written advice to Shareholder (sought by Shareholder or counsel to Shareholder,
with a copy thereof and all other related communications delivered to Access
Beyond and its legal counsel) to the effect that the SEC would take no action,
or that the staff of the SEC would not recommend that the SEC take action, with
respect to the proposed disposition of Merger Securities if consummated. Nothing
herein imposes upon Access Beyond any obligation to register any Merger
Securities under the 1933 Act.
(f) Intent. Shareholder does not now have, and as of the Effective
Time of the Merger will not have, any present plan or intention to engage in a
sale, exchange, transfer, distribution, pledge, disposition or any other
transaction which would result in a direct or indirect disposition (a "Sale") of
shares of Access Beyond voting common stock to be issued to ▇▇▇▇▇ shareholders
in the Merger, which shares would have an aggregate fair market value, as of the
Effective Time of the Merger, in excess of 50% of the aggregate fair market
value, immediately prior to the Merger, of all outstanding shares of ▇▇▇▇▇
stock. For purposes of this representation, shares of ▇▇▇▇▇ stock (or the
portion thereof) (a) with respect to which a ▇▇▇▇▇ shareholder receives
consideration in the Merger other than Access Beyond voting common stock and/or
(b) with respect to which a Sale by a ▇▇▇▇▇ shareholder who owns 5% or more of
▇▇▇▇▇ stock or is an officer or director of ▇▇▇▇▇ occurs during the pre-merger
period shall be considered shares of outstanding ▇▇▇▇▇ stock exchanged for
Access Beyond voting common stock in the Merger and then disposed of pursuant to
a prearranged plan.
3. Legends. Shareholder also understands and agrees that stop transfer
instructions will be given to Access Beyond's transfer agent with respect to
certificates evidencing the Merger Securities to enforce Shareholder's
compliance with Shareholder's representations in Sections 2(e) and Shareholder's
compliance with applicable securities laws regarding the Merger Securities, and
that there will be placed on the certificates evidencing such Merger Securities
a legend providing substantially as follows:
3
"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED,
SOLD, PLEDGED, EXCHANGED, TRANSFERRED OR OTHERWISE DISPOSED OF
EXCEPT IN ACCORDANCE WITH THE REQUIREMENTS OF THE SECURITIES ACT OF
1933, AS AMENDED, ANY APPLICABLE STATE SECURITIES LAWS, AND THE
OTHER CONDITIONS SPECIFIED IN THAT CERTAIN ▇▇▇▇▇ AFFILIATE AGREEMENT
DATED AS OF JULY 29, 1997 AMONG ACCESS BEYOND, INC. ("ACCESS
BEYOND"), ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC. AND THE HOLDER OF SUCH
SHARES, A COPY OF WHICH MAY BE INSPECTED BY THE HOLDER OF THIS
CERTIFICATE AT THE OFFICES OF THE ISSUER. THE ISSUER WILL FURNISH
WITHOUT CHARGE A COPY THEREOF TO THE HOLDER OF THIS CERTIFICATE UPON
WRITTEN REQUEST THEREFOR."
4. Notices. All notices, approvals, consents, requests and other
communications that any party is required or elects to give hereunder shall be
in writing and shall be deemed to have been given (a) upon personal delivery
thereof, including by appropriate international courier service, five (5) days
after delivery to the courier or, if earlier, upon delivery against a signed
receipt therefor or (b) upon transmission by facsimile or telecopier, which
transmission is confirmed, in either case addressed to the party to be notified
at the address set forth below or at such other address as such party shall have
notified the other parties hereto, by notice given in conformity with this
Section 4:
(a) If to Access Beyond:
Access Beyond, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President/CEO
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Morrison, Cohen, Singer & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
4
(b) If to ▇▇▇▇▇:
(If via hand delivery or overnight courier)
▇▇▇▇▇ Microcomputer Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chairman of the Board and
Contracts Administration
(If via mail)
▇▇▇▇▇ Microcomputer Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman of the Board and
Contracts Administration
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: G. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(c) If to Shareholder:
At the address for notice to such Shareholder set forth
on the last page hereof
with a copy to:
Counsel for Shareholder, if any, at the address shown on
the signature page hereto
Any party hereto may change its address specified for notices herein by
designating a new address by notice in accordance with this Section 4.
5. Survival; Termination. All representations, warranties and
agreements made by Shareholder in this Affiliate Agreement shall survive the
consummation of the Merger. This Affiliate Agreement shall be terminated and
shall be of no further force and effect upon the earlier to occur of (i) any
termination of the Merger Agreement pursuant to its terms, or (ii) any waiver of
either any closing condition in favor of ▇▇▇▇▇ or any obligation of Access
Beyond under or any amendment of the Merger Agreement, or the giving of any
required consent of ▇▇▇▇▇ under Section 4.3 or any other provision of the Merger
Agreement, unless such waiver, amendment or consent is approved either by the
Board of Directors of ▇▇▇▇▇ or any committee thereof consisting
5
of at least two (2) members of the ▇▇▇▇▇ Board authorized to approve any such
amendment, waiver or consent, one of whom approving such amendment, waiver or
consent by action of either the full ▇▇▇▇▇ Board or such committee is a
representative of Rinzai Limited.
6. Expenses. All costs and expenses incurred in connection with the
transactions contemplated by this Affiliate Agreement shall be paid by the party
incurring such costs and expenses; provided, however, that the Shareholder's
legal costs and expenses shall be promptly paid by ▇▇▇▇▇.
7. Counterparts. This Affiliate Agreement may be executed in
counterparts, each of which will be an original as regards any party whose name
appears thereon and all of which together will constitute one and the same
agreement. This Affiliate Agreement will become binding when one or more
counterparts hereof, individually or taken together, bear the signatures of all
parties reflected hereon as signatories. Facsimile copies with signatories of
the parties to this Agreement, or their duly authorized representatives, shall
be legally binding and enforceable. All such facsimile copies are declared as
originals and, accordingly admissible in any jurisdiction or tribunal having
jurisdiction over any matter relating to this Agreement.
8. Assignment, Binding Effect. Except as provided herein, neither
this Affiliate Agreement nor any of the rights, interests or obligations
hereunder shall be assigned the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other parties hereto.
Subject to the preceding sentence, this Affiliate Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted signs.
9. Amendment and Waivers. Any term or provision of this Affiliate
Agreement may be amended, and the observance of any term of this Affiliate
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively), only by a writing signed by the parties to be
bound thereby. The waiver by a party of any breach hereof or default in the
performance hereof will not be deemed to constitute a waiver of any other
default or any succeeding breach or default.
10. Entire Agreement. This Affiliate Agreement and any documents
delivered by the parties in connection herewith constitute the entire agreement
between the parties with respect to the subject matter hereof and thereof and
supersedes all prior agreements and under standings between the parties with
respect thereto.
11. Other Agreements. Nothing in this Affiliate Agreement shall
limit any of the rights or remedies of Access Beyond or Shareholder or any of
the obligations of either party under any Voting Agreement between Access Beyond
and Shareholder or any other agreement.
12. Severability. Any term or provision of this Affiliate Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining
6
terms and provisions of this Affiliate Agreement or affecting the validity or
enforceability of any of the terms and provisions of this Affiliate Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Affiliate Agreement in any other jurisdiction. If any provision of this
Affiliate Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
13. Governing Law. The internal laws of the State of Georgia
(irrespective of its choice of law principles) will govern the validity of this
Affiliate Agreement, the construction of its terms, and the interpretation and
enforcement of the rights and duties of the parties hereto.
14. Construction. The language hereof will not be construed for or
against either party. A reference to a section will mean a section of this
Affiliate Agreement, unless otherwise explicitly set forth. The titles and
headings in this Affiliate Agreement are for reference purposes only and will
not in any manner limit the construction of this Affiliate Agreement. For the
purposes of such construction, this Affiliate Agreement will be considered as a
whole.
15. ▇▇▇▇▇ Shareholder Agreement. Shareholder acknowledges that the
execution hereof by Shareholder and the execution by any other shareholders of
▇▇▇▇▇ of similar agreements in connection with the Merger, is not a violation
of, and, in particular, does not constitute a "Transfer" or "Disposition" under
the Shareholder Agreement among the shareholders of ▇▇▇▇▇ dated April 16, 1996.
Shareholder further acknowledges and agrees that this Affiliate Agreement does
not constitute any liquidation or redemption event applicable to the Merger
Securities under the Articles of Incorporation, Bylaws or other organizational
documents of ▇▇▇▇▇, or contracts to which such Shareholder is a party.
IN WITNESS WHEREOF, the parties hereto have caused this Affiliate
Agreement to be executed as of the date first written above.
ACCESS BEYOND, INC. ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
By: By:
-------------------------------- --------------------------------------
Name: Name:
Title: Title:
SHAREHOLDER:
-----------------------------------
7
ATTACHMENT 1
Affiliate's Address for Notice: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇
with a copy to counsel ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
for Shareholder ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Quigkley, P.C.
Fourteenth Floor Lenox Towers II
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Number of Shares of ▇▇▇▇▇
Common Stock owned as of the
date of this Affiliate Agreement: 543,221
Number of Shares of ▇▇▇▇▇
Series A Preferred Stock owned
as of the date of this Affiliate Agreement: N/A
Number of Shares of ▇▇▇▇▇
Series B Preferred Stock owned
as of the date of this Affiliate Agreement: N/A
Number of ▇▇▇▇▇ Options for
Common Stock owned as of
the date of this Affiliate Agreement: N/A
Number of ▇▇▇▇▇ Warrants for
Common Stock owned as of
the date of this Affiliate Agreement: N/A
8
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement (this "Agreement") is entered into by
and between ▇▇▇▇▇ Communications Inc., formerly known as Access Beyond, Inc.
(the "Company") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (the "Executive") on this 29th day of July,
1997.
For and in consideration of the employment or continued employment, as the
case may be, of the Executive by the Company, the mutual covenants and promises
contained herein, and in the Terms and Conditions of Employment attached hereto
as Exhibit "A," and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Executive
hereby covenant and agree as follows:
1. Employment; Duties. Company hereby employs Executive as Vice Chairman
of the Board of Directors and Executive Vice President - Corporate Development
on the terms and conditions set forth herein and Executive accepts such
employment. Executive shall report to the Chairman of the Company. Executive's
duties shall be as follows:
(a) Participate and advise the Company on the successful launch of
the networking business of ▇▇▇▇▇ and the successful combination of Access
Beyond, Inc. and ▇▇▇▇▇ Microcomputer Products, Inc.
(b) Participate as a corporate spokesperson to the financial
community and to the industry in coordination with the other Company
spokesperson.
(c) Participate in the development of mergers and acquisitions
strategy, the evaluation of merger and acquisition opportunities, and
recommendations to the Chairman and the Board.
(d) Promote and encourage an environment of progressive innovation
and openness to change in the Company culture.
(e) Serve as a member of and participate on the Senior Management
Committee consisting of the Chairman, Vice Chairman and the President, to
be established by the Board of Directors of the Company subject to
guidelines established by the Board, to ▇▇▇▇▇▇ and enhance communications
among the senior officers of the Company in order to facilitate and
coordinate the strategic and operational activities of the Company.
(f) Such other duties and responsibilities as may be assigned by the
Chairman or the Board from time to time, consistent with Executive's
status as a senior executive of the Company, Executive's principal areas
of expertise as reflected in the above responsibilities, and the other
terms of this Agreement.
(g) The Company agrees that Executive will not be required to
relocate to the Atlanta area; provided that Executive agrees that he will
spend as much time at the
Company's headquarters as reasonably determined by the Board of Directors
of the Company to be necessary for Executive to perform his duties.
2. Compensation.
(a) Base Salary. Executive's initial base salary shall be
$330,000.00 per year and shall be reviewed and subject to increase but not
decrease in the discretion of the Board on an annual basis for the Term
hereof. The Executive's salary shall not be less than that of the
President of the Company during the first year of the Term hereof.
(b) Bonus. In addition, Executive shall be eligible for aggregate
bonuses equal to an amount calculated by dividing Executive's base salary
by seventy percent (70%) and subtracting from the result so obtained the
amount of Executive's base salary. The amount obtained by such calculation
is herein referred to as the "Bonus Amount".
(i) The Executive shall be eligible for a Personal Incentive
Bonus in the maximum amount of thirty percent (30%) of
the Bonus Amount, based on attaining personal goals in
respect to his duties on behalf of the Company as such
goals may be established by the Compensation Committee
of the Company.
(ii) Executive shall be eligible for a Corporate Incentive
Bonus in the maximum amount of seventy percent (70%) of
the Bonus Amount, based on the Company's attaining such
goals, objectives and benchmarks as may be set by the
Board of the Company.
3. Stock Option Plan. The Company shall award to Executive each year
during the Term hereof, stock options to purchase 150,000 shares of common stock
of the Company with an exercise price at fair market value as of the date of
award less a fifteen percent (15%) discount off the fair market value at the
date of award (the "Options"). Fair market value shall mean the average closing
price of the Company's stock for the twenty (20) trading days immediately prior
to the date of the award. Such Options shall have the following additional
features:
(a) The Options will have a term of ten (10) years from the date of
award, and must be exercised within such ten (10) year period, except as
expressly set forth below in this Section 3.
(b) The Options will be awarded effective as of January 1 of each
year of the Term hereof.
- 2 -
(c) Twenty-five percent (25%) of the Options will vest at the date
of award and twenty-five percent (25%) on December 31 of such year and
each ensuing year, except as otherwise provided in this Section 3.
(d) If Executive voluntarily resigns his employment (except in the
case of a breach hereof by the Company, or in the case of a Change of
Control, as hereinafter defined) or if Executive's employment is
terminated by the Company for Cause (as hereinafter defined), then no
further vesting will occur and all unvested Options will terminate
immediately upon such termination of employment. Executive must exercise
any vested Options after such termination of employment within the earlier
to occur of (i) five (5) years after the date of termination of employment
or (ii) the expiration of the ten (10) year term of the Options.
(e) If Executive's employment is not continued after the expiration
of the Term hereof for a period of at least two (2) years or if
Executive's employment terminates as a result of his death or disability,
or if Executive's employment terminates for any reason within one (1) year
after a Change of Control, then all unvested Options shall vest at the
time that such Options would have vested as if Executive's employment had
continued through such time.
(f) If Executive's employment is terminated in breach hereof by the
Company, or if Executive terminates as a result of a breach hereof by the
Company, then all unvested Options awarded through such termination date
shall vest immediately upon such termination.
(g) "Change of Control," for purposes of this Section 3, means (i)
the closing of a merger, consolidation or reorganization of the Company
with or into any other corporation or corporations in which the Company is
not the surviving entity (other than a mere reincorporation transaction),
(ii) a sale of all or substantially all of the assets of the Company,
(iii) a transaction or series of related transactions in which the Company
issues shares representing more than 50% of the voting power of the
Company, immediately after giving effect to such transaction or series of
related transactions, to a person or persons who were not shareholders of
the Company immediately prior to such transaction, or (iv) if during any
period of two (2) consecutive years or less there shall cease to be a
majority of the Board comprised of "Continuing Directors", defined as
individuals who constitute the Board as of the date of this Employment
Agreement and any new director(s) whose election by such Board or
nomination for election by Employer's stockholders was approved by a vote
of at least two-thirds (2/3) of the directors then in office who either
were directors as of the date of this Employment Agreement or whose
election or nomination for election was previously approved.
4. Term. The term of the Executive's employment hereunder is conditioned
upon the occurrence of, and shall commence on, the Effective Time under the
Agreement and Plan of
- 3 -
Reorganization between ▇▇▇▇▇ Microcomputer Products, Inc. and Access Beyond,
Inc. (the "Effective Time"), and shall continue for a period of three (3) years
from January 1, 1998 unless either terminated or extended as provided by the
Agreement (the "Term"). The Employment Agreement dated November 18, 1996 between
Access Beyond, Inc. and Executive is hereby terminated effective as of the
Effective Time.
5. Benefits. Executive shall be afforded the same benefits and perquisites
as shall be made generally available to the other senior executive officers of
the Company. It is expressly agreed that the Company shall continue to pay the
premiums on the life insurance policy that has heretofore been paid by the
Company immediately prior to the Effective Time.
6. Termination and Severance. This Agreement may be terminated by Company
with Cause as defined in the Terms and Conditions of Employment attached hereto
as Exhibit "A". In the event that Company or the Chairman of the Board
terminates Executive's employment for Cause, or Executive voluntarily terminates
employment other than due to breach hereof by the Company, or the Term expires,
the Company shall not be obligated to pay any salary or other Compensation to
Executive after the effective date of termination. Executive agrees to provide
Company with at least six (6) weeks advance written notice prior to voluntary
termination or resignation by Executive.
7. Dispute Resolution.
7.1 Resolution of Disputes and Mediation. Except for the matters set forth
in Sections 2, 3, and 5 of Exhibit "A" hereto, any dispute between the parties
either with respect to the interpretation of any provision of this Agreement or
with respect to the performance by the Executive or by the Company hereunder
(the "Dispute") shall be resolved in accordance with this Section 7 as follows:
7.1.1 Upon the written request of either party hereto, each of the
parties shall appoint a designated representative, whose task it shall be
to meet for the purpose of endeavoring to resolve the Dispute. The
Company's designated representative shall be a member of the Board
excluding (i) the Executive and (ii) the Board member selected by the
Executive to be a Board member.
7.1.2 The designated representatives shall meet as often as
necessary to gather and furnish to the other all information with respect
to the Dispute which is appropriate and germane in connection with its
resolution.
7.1.3 Such representatives shall discuss the Dispute and negotiate
in good faith in an effort to resolve the Dispute without the necessity of
any formal proceeding relating thereto.
- 4 -
7.1.4 During the course of such negotiations all reasonable requests
made by one party to the other for non-privileged information reasonably
related to the Dispute, shall be honored in order that each of the parties
may be fully advised of the other's position.
7.1.5 The specific format for such discussions shall be left to the
discretion of the designated representatives but may include the
preparation of agreed upon statements of fact or written statements of
position furnished to the other party.
7.2 Judicial Resolution. If the parties hereto are not able to resolve the
Dispute concerning this Agreement as set forth in Section 7.1 above within sixty
(60) calendar days, upon the initial written request as provided in Section
7.1.1, then the parties shall have the option and right to resolve such Dispute
by judicial or other equitable resolution.
8. Errors and Omissions. The Company shall provide directors' and
officers' liability and errors and omissions coverage for the Executive in an
amount and under terms consistent with those provided other Company officers and
directors.
9. Reimbursement of Expenses. The Company shall reimburse the Executive
for all reasonable expenses incurred by the Executive in performing his duties
hereunder, including without limitation, expenditures for entertainment, travel,
lodging, and meals; provided, however, the Executive shall submit to the Company
verification of the nature and amount of such expenses in accordance with
Company policies and procedures as established from time to time by the
Compensation Committee, including audit, related to expense reimbursement of
employees.
10. Repayment Upon Disallowance. Any salary, commission, expense,
reimbursement or other payment to the Executive by the Company pursuant to
Section 9 which is disallowed in whole or in part as a deductible expense to the
Company for federal or state income tax purposes shall be promptly repaid to the
Company by the Executive to the full extent of such disallowance, but without
the payment by the Executive of any interest or penalty incurred by the Company
in connection with the disallowance of any such payment as a deductible expense
for the Company.
11. Terms and Conditions. Executive acknowledges that this Agreement, and
his employment obligations hereunder, expressly include the provisions set forth
in the Terms and Conditions of Employment attached hereto as Exhibit "A", which
are incorporated herein by this reference thereto. This Agreement shall
supersede any prior employment agreement, and any restrictive covenants,
previously entered into by Executive with the Company.
[EXECUTION ON THE FOLLOWING PAGE]
- 5 -
IN WITNESS WHEREOF, the parties hereto have set their hands and seals on
the date and year first above written.
EXECUTIVE: COMPANY:
(SEAL) By: (SEAL)
----------------------------------- -----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman
[TERMS AND CONDITIONS OF EMPLOYMENT ON FOLLOWING PAGES]
- 6 -
EXHIBIT "A"
TERMS AND CONDITIONS OF EMPLOYMENT
1. Duties and Responsibilities. Executive shall devote his full business
time and best efforts to the duties and responsibilities assigned by the Company
in accordance with the provisions hereof and shall abide by this Agreement and
the Company's Operations Policies. Notwithstanding the foregoing, nothing in
this Agreement shall be deemed to prohibit the Executive from serving on boards
of directors or from consulting with charitable or other organizations on
non-Company time, so long as such organization is not in competition with the
Company and does not interfere with Executive's performance of his duties on
behalf of the Company. Executive's specific job description and responsibilities
include, but are not limited to, those described in Section 1 of this Agreement.
2. Confidential Information, Trade Secrets. Executive shall not use or
disclose to any person or entity any Confidential Information or trade secrets
of Company other than as necessary in the fulfillment of this Agreement in the
course of employment. This paragraph shall be effective during the term hereof
and for a period of two (2) years after termination of employment, whether with
or without Cause.
3. Inventions. The Company and Executive acknowledge that in the course of
Executive's employment by the Company, Executive may from time to time develop
or participate in the development of software or technology. All works or
inventions conceived, originated, authored, or discovered, in whole or in part,
by Executive, which result from any work performed for the Company or related to
or useful in the business of the Company are and shall be the exclusive property
of the Company. Executive shall cooperate with the Company in the protection of
the Company's copyrights, patents, and other proprietary rights therein and, to
the extent deemed desirable by the Company, in the registration of the same.
Executive hereby assigns to the Company all of Executive's right, title and
interest in and to any and all inventions, processes, systems and creations,
whether or not patentable or copyrightable, that Executive may conceive,
develop, or create, in whole or in part, during his employment with the Company,
whether or not during normal working hours. Executive shall sign and deliver all
documents relative to said inventions requested by the Company for the purpose
of confirming the Company's title thereto.
4. Company Property. Upon request of the Company, and without request
promptly on termination of this Agreement or Executive's employment hereunder,
Executive shall deliver all Company Property in Executive's possession or
control to the Company. Executive acknowledges and agrees that title to all
Company Property is vested in the Company, and Executive shall not retain any
such property or any copies thereof in any form, including magnetic or
electronic form.
5. Protective Covenants. Executive is and will during the course of
employment become intimately familiar with Confidential Information, trade
secrets, facilities and services, and other property of the Company, and the
protection of the Company requires that all such property and information must
remain the sole and private property of the Company to be used only for the
Company's benefit, not to be disclosed to any other party or used by Executive
against
- 7 -
Company. Accordingly, Executive does hereby warrant, represent, covenant and
agree, as follows:
(i) Covenant Not to Compete. Executive agrees that, for a period of
eighteen (18) months from the termination of his employment with
Company, whether with or without Cause, he shall not, directly or
indirectly, on behalf of himself or any other person or entity,
compete with the Company within a fifty (50) mile radius of the
Company's principal place of business in Norcross, Georgia, or its
principal place of business in Gaithersburg, Maryland, by engaging
in the manufacture, assembling, or selling of computer component
products, software, or systems, including modems, competitive with
those manufactured, assembled, or sold by the Company, in a capacity
which requires Executive to perform services substantially identical
to the services performed by Executive on behalf of Company.
(ii) Covenant Not to Solicit Customers. During the term of Executive's
employment hereunder, and for a period of eighteen (18) months
following the termination of such employment for any reason
whatsoever, Executive shall not (except on behalf of or with the
prior written consent of Company), either directly or indirectly, on
Executive's own behalf or on behalf of others, solicit, divert, or
appropriate any business for the manufacture, assembling, or sale of
computer component products, software or systems, including modems,
competitive with those manufactured, assembled or sold by the
Company, from any customer or actively sought prospective customer
of the Company to whom the Company offered or provided products or
services, and with whom Executive had material contact at any time
during the twenty-four (24) months preceding the termination of
Executive's employment.
(iii) Covenant Not to Solicit Employees. During the term of Executive's
employment hereunder, and for a period of eighteen (18) months
following the termination of such employment for any reason
whatsoever, Executive shall not employ or solicit the employment of
any employee of the Company who was an employee of the Company at
any time during the six (6) months preceding the termination of
Executive's employment with the Company, for the purpose of causing
such employee to take employment with Executive or a competitor of
the Company.
Executive agrees and acknowledges that the restrictions in this
Agreement are not vague, over broad or indefinite, and are reasonable and
designed to protect the legitimate business interests of the Company. In
addition to any other remedies which Company may have under the law for breach
of any or all of said covenants, Company shall be entitled to injunctive and/or
other equitable relief against Executive for any violation of any of said
Covenants.
6. Survival. Paragraphs 2, 3, 4, 5, and 6 hereof, together with any
provisions of the Company's Operations Policies expressly or by necessary
implication applicable after the termination of employment, shall survive
termination of this Agreement. Upon termination, Executive shall repay to
Company immediately any advances by Company, not offset by earnings or other
credits due him or her, even if not expressly made repayable at the time of such
advance, it being the intent of the parties that all such advances shall be
repayable as provided by this
- 8 -
paragraph. Company may offset any sums owed to Company by Executive against any
amounts otherwise owed by Company to Executive. No sums otherwise due Executive
at termination shall be payable to Executive if, at the time of termination or
thereafter, Executive shall be in violation of any term or provision of this
Agreement.
7. Entire Agreement. This Agreement contains the entire understanding and
agreement between the parties, and all promises, representations, warranties or
inducements made by either party to the other, including any prior employment
agreement or restrictive covenants, not specifically made in writing or made a
part hereof by reference, are expressly superseded and shall have no force or
effect. This Agreement may not be modified except in a writing signed by both
parties hereto.
8. Severability. If any provision of this Agreement (including any
subparts of any paragraph) is invalid or unenforceable by any rule of law or
public policy, this Agreement shall be construed so as to delete herefrom the
invalid or unenforceable covenant or provision. To the extent that any provision
is invalid or unenforceable that may be valid or enforceable by limitation
thereof, then such provision shall be enforceable to the fullest extent
permitted under the law of the jurisdiction in which enforcement is sought. If
any particular provision is held to be invalid, illegal or unenforceable, all
other covenants, terms, conditions and provisions hereof shall be and remain in
full force and effect.
9. Binding Effect. This Agreement shall be binding upon, and shall inure
to the benefit of, each respective party's heirs, successors, legal
representatives, executors and assigns. This Agreement shall be construed and
governed in accordance with the laws of the State of Georgia.
10. Definitions. Any word used in this Agreement which is defined in this
paragraph shall have the meaning set forth below:
(a) "Agreement." The Executive Employment Agreement, together with
the Terms and Conditions of Employment and any documents incorporated therein by
reference. In the event of any inconsistency between the Agreement and any
Operations Policies, the Agreement shall control.
(b) Cause. The term "Cause" as used in the within and foregoing
Agreement shall mean (i) Executive's breach of a material covenant or obligation
of this Agreement, including any of the Terms and Conditions of Employment, or
any failure or refusal by Executive to perform Executive's duties hereunder to
the reasonable satisfaction of the Board of Directors, or to comply with any
lawful directive of the Board of Directors consistent with the provisions of
this Agreement, if, after receiving written notice of such breach, failure or
refusal to perform, Executive does not cure or correct such breach, failure or
refusal or cease and desist from such breach if incapable of being cured, within
fifteen (15) business days after Executive's receipt of such notice; and (ii)
conviction of a crime involving any act of Executive in the course of
Executive's employment that constitutes larceny, fraud or moral turpitude, or
(iii) failure to maintain the confidentiality of the Confidential Information
and trade secrets of Company.
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(c) "Company." ▇▇▇▇▇ Microcomputer Products, Inc., and any successor
or assignee hereof.
(d) "Company Property." All property, without limitation, whether
real, personal, tangible or intangible, including all inventions, confidential
information, trade secrets, facilities, trade names, logos, patents and all
tangible materials and supplies (whether originals or duplicates and including,
but not in any way limited to, sample products, video tape cassettes, film,
catalogues, price lists, rate sheets, outstanding quotations, books, records,
manuals, sales presentation literature, training materials, calling or business
cards, customer record cards, customer files, customer names, addresses and
telephone numbers, supplier information, contacts, pricing and practices,
strategic partner information, files and records, current or prospective
business plans, Operations Policies, directives, correspondence, documents,
contracts, orders, messages, memoranda, notes, circulars, agreements, bulletins,
invoices and receipts, and sources of financing), which in any way pertain to
Company's business, whether or not furnished to Executive by Company and whether
or not prepared, compiled, or acquired by Executive while employed by Company,
are the sole property of Company.
(e) "Compensation." Any and all payments, remuneration and benefits,
provided to Executive by the Company, regardless of the form thereof. Such
compensation as is paid to Executive shall be conclusively deemed legally
sufficient consideration for this Agreement.
(f) "Confidential Information." All confidential information
regarding the Company's business, including but not limited to its methods of
operation, products, software programs, equipment and techniques, existing and
contemplated facilities and services, inventions, systems, devices (whether or
not patentable), financial information and practices, plans, pricing, selling
techniques, names, addresses and phone numbers of the Company's Customers and
prospective Customers and suppliers and prospective suppliers, credit
information and financial data of the Company and the Company's Customers and
prospective customers and suppliers and prospective suppliers, particular
business requirements of the Company's Customers, and special methods and
processes involved in designing, producing and selling Company's facilities and
services, current and prospective business plans, strategic partner information,
files and records, and the terms of this Agreement, all shall be deemed
Confidential Information and the Company's exclusive property. The parties agree
that Confidential Information shall be deemed to be trade secrets under the
Georgia Trade Secrets Act. Confidential Information shall not include
information that is in the public domain or otherwise readily accessible to
members of the public.
(g) "Customer." Each person, corporation, firm, partnership or other
entity whatsoever, which has purchased or shall purchase the Company's products,
facilities or services.
(h) "Executive." The person signing this Agreement as Executive,
regardless of any title or duties which may now or hereafter be assigned to such
person by the Company. This Agreement shall govern the employment relationship
in any and all such situations.
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(i) "Inventions." Any and all devices, systems, software and other
programs, processes, products, patents and any other creation (all of the
foregoing, for purposes of this paragraph, called "inventions") identical or
similar to or relating to devices, processes, systems, products or services
utilized and/or offered by the Company.
(j) "Operations Policies." All written procedures, policies,
instructions from Company's officers, directors or managers, the Company
Employee Manual (if any), and all other written communications from the Company
to Executive individually, not inconsistent with Executive's duties hereunder,
or to all Company's employees. Said Operations Policies are hereby incorporated
herein and expressly made a part of this Agreement by this reference thereto.
(k) "Termination." Cessation of this Agreement or the underlying
employment relationship, whether by action of the Executive or Company, and
whether voluntary or involuntary. Termination hereby may be with or without
Cause.
(l) "Terms and Conditions of Employment." This document entitled
Terms and Conditions of Employment, which is Exhibit "A" to the Executive
Employment Agreement, and all of the provisions hereof.
PLEASE INITIAL:
----------------------------------
Executive
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made this ___ day of
__________, 1997, between ▇▇▇▇▇ COMMUNICATIONS INC. (formerly known as ACCESS
BEYOND, INC.), a Delaware corporation (the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, a
resident of Gwinnett County, Georgia (the "Executive").
W I T N E S S E T H :
WHEREAS, ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia corporation
("▇▇▇▇▇") and Executive have entered into that certain Employment Agreement
dated July 1, 1983, as amended and restated by that certain Amendment and
Restated Employment Agreement dated April 16, 1996 (the "Employment Agreement")
which are currently in force; and
WHEREAS, pursuant to the April 16, 1996 Employment Agreement between
Executive and ▇▇▇▇▇, Executive has been entitled to a $1,000,000 annual base
salary and certain benefits and perquisites which Executive and the Company
desire to revise to an incentive-based compensation plan which reflects that
▇▇▇▇▇ will become a publicly traded company upon completion of the Merger
pursuant to the Merger Agreement (defined below); and
WHEREAS, the Executive and the Company desire to enter into this
Agreement in order to set forth the terms under which Executive's employment
with the Company will commence upon the Effective Time (as defined below) and
certain arrangements with respect to Executive's activities and obligations
following the termination of Executive's employment with the Company; and
WHEREAS, ▇▇▇▇▇ is engaged in the business of developing,
manufacturing, marketing and distributing certain computer component products,
software and systems and the Company is engaged in the business of developing
and marketing network access devices (hereinafter the collective business of
▇▇▇▇▇ and the Company referred to as the "Business of the Company"); and
WHEREAS, ▇▇▇▇▇ has entered into that certain Agreement and Plan of
Reorganization between ▇▇▇▇▇ and the Company dated the _____ day of
____________, 1997 (the "Merger Agreement"); and
WHEREAS, execution of this Agreement is a condition precedent to the
effectiveness and enforceability of the Merger Agreement and the closing of the
Merger as contemplated in the Merger Agreement is a condition to the
effectiveness of this Agreement..
NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged, the Executive, ▇▇▇▇▇, and the
Company agree as follows:
1. Employment and Duties.
1.1 Appointment as Chairman. For the Term of this Agreement as set forth
in Section 2 hereof, the Executive shall be employed, hold the office, perform
the duties, and have the authority and responsibilities of the Chairman of the
Board of Directors, which shall be a corporate office of the Company
("Chairman") of the Company as set forth herein.
1.2 Duties of the Chairman. The Executive shall have the following
authority, responsibilities and duties as Chairman of the Company:
1.2.1 The Chairman shall direct the Office of Chairman which will
develop initiatives for the Board of Directors ("Board") and shareholders
in connection with long-term operating and strategic planning, policy
development, new technology strategy and corporate business development
for the Company.
1.2.2 The Chairman shall act as a Company spokesperson and shall
exert his best efforts to interface, develop and maintain positive
relations with the industrial, political, business, financial, academic,
investment and research communities.
1.2.3 The Chairman shall serve as a member of and participate on the
Senior Management Committee to be established by the Board of Directors of
the Company to ▇▇▇▇▇▇ and enhance communications among the senior officers
of the Company in order to facilitate and coordinate the strategic and
operational activities of the Company.
1.3 Other Duties. The Chairman shall perform such other duties as may be
reasonably assigned from time to time by the Board consistent with the position
of Chairman.
1.4 Duties of CEO. To the extent that the responsibilities of the Chairman
duplicate duties assigned to the Chief Executive Officer of the Company (the
"CEO"), the Chairman shall advise the CEO on those responsibilities.
1.5 Outside Activities. During the Term, the Executive shall devote his
full business time and efforts to the execution of his duties and
responsibilities hereunder. Notwithstanding the foregoing, nothing in this
Agreement shall be deemed to prohibit the Executive from serving on other boards
of directors, whether or not for compensation (subject to Board approval and
opinion of Company counsel, as may be appropriate) and from consulting for other
non-Competing Businesses, as defined in Section 5.1, on non-Company time, or
from owning copyrights, royalties, or other rights with respect to books,
historical accounts, speeches, presentations, or other works of authorship by or
in collaboration with the Executive, whether or not they relate to the Company
or its affairs to the extent that such activities do not interfere with his
performance of his duties and responsibilities as Chairman and are permitted by
Sections 5, 6, and 7 of this Agreement.
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1.6 Other Positions. The Executive shall only hold the office of Chairman.
The employment by the Company of the Executive hereunder as the Chairman shall
not preclude appointment or election of the Executive by the Board to any other
corporate office of the Company.
2. Term and Effective Time.
The term of the Executive's employment hereunder is conditioned upon the
occurrence of, and shall commence on, the Effective Time under the Merger
Agreement (the "Effective Time"), and shall continue for a period of three (3)
years from January 1, 1998 unless either terminated or extended as provided by
the Agreement (the "Term"). The April 16, 1996 Employment Agreement is
terminated effective as of the Effective Time.
3. Compensation and Other Benefits.
3.1 Salary. As compensation for his services to the Company rendered
pursuant hereto, the Executive shall be paid a base salary at the rate Four
Hundred Thousand Dollars ($400,000.00) per annum (hereinafter referred to as
"Base Salary") with increases on each anniversary date of the Effective Time to
the Base Salary directly proportional to any increase (but not decrease) in the
cost of living as reflected by the "Consumer Price Index for Urban Wage Earners
and Clerical Workers-All Items" ("CPI") published by the Bureau of Labor
Statistics of the U.S. Department of Labor (or the official successor to such
index) in effect on such anniversary date as compared to the CPI in effect on
the preceding anniversary date or Effective Time, as appropriate. The Base
Salary shall accrue and be due and payable in equal, or as nearly equal as
practicable, semi-monthly installments, and the Company may deduct from each
such installment all amounts required to be deducted and withheld in accordance
with the provisions of any applicable law now in effect or hereafter in effect
including without limitation federal and state income, FICA and other
withholding tax requirements, and such other deductions permitted by the Company
which Executive may authorize from time to time.
If the Effective Time is on other than the first business day of a
calendar month or if the Executive's employment hereunder shall terminate on
other than the last day of a calendar month, the Executive's Base Salary for
such month shall be prorated according to the number of days during such month
that the Executive was employed hereunder.
3.2 Bonus. Executive shall be eligible for such bonuses as follows:
3.2.1 Personal Incentive Bonus. Executive shall be paid a personal
incentive bonus up to a maximum of Five Hundred Thousand Dollars
($500,000.00) per year, payable quarterly, based on Executive's attaining
personal goals in respect to his employment as Chairman of the Company,
such goals to be mutually determined by the Executive and the Compensation
Committee of the Board (the "Compensation Committee") and approved by the
Board.
- 3 -
3.2.2 Corporate Incentive Bonus. The Executive shall be eligible to
receive a Corporate Incentive Bonus up to a maximum amount of Three
Hundred Thousand Dollars ($300,000.00) per year, payable semi-annually.
The payment of such Corporate Incentive Bonus shall be based on the
Company's attainment of the same goals, objectives and benchmarks as set
by the Board for the payment of a similar corporate incentive bonus to the
President of the Company.
3.3 Stock Option Plan. The Company shall award to Executive each year
during the Term hereof, stock options to purchase 200,000 shares of common stock
of the Company with an exercise price at fair market value as of the date of
award less a fifteen percent (15%) discount off the fair market value at the
date of award (the "Options"). Fair market value shall mean the average closing
price of the Company's stock for the twenty (20) trading days immediately prior
to the date of the award. Such Options shall have the following additional
features:
(a) The Options will have a term of ten (10) years from the date of
award, and must be exercised within such ten (10) year period, except as
expressly set forth below in this Section 3.3.
(b) The Options will be awarded effective as of January 1 of each
year of the Term hereof.
(c) Twenty-five percent (25%) of the Options will vest at the date
of award and twenty-five percent (25%) on December 31 of such year and
each ensuing year, except as otherwise provided in this Section 3.3.
(d) If Executive voluntarily resigns his employment (except in the
case of a breach hereof by the Company or in the case of a Change of
Control, as hereinafter defined) or if Executive's employment is
terminated by the Company for Cause (as hereinafter defined), then no
further vesting will occur and all unvested Options will terminate
immediately upon such termination of employment. Executive must exercise
any vested Options after such termination of employment within the earlier
to occur of (i) five (5) years after the date of termination of employment
or (ii) the expiration of the ten (10) year term of the Options.
(e) If Executive's employment is not continued after the expiration
of the Term hereof for a period of at least two (2) years or if
Executive's employment terminates as a result of his death or disability
(as contemplated by Section 3.7.3 hereof), or if Executive's employment
terminates for any reason within one (1) year after a Change of Control,
then all unvested Options shall vest at the time that such Options would
have vested as if Executive's employment had continued through such time.
(f) If Executive's employment is terminated in breach hereof by the
Company, or if Executive terminates as a result of a breach by the
Company, then all unvested
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Options awarded through such termination date shall vest immediately upon
such termination.
(g) "Change of Control," for purposes of this Section 3.3, means the
closing of a merger, consolidation or reorganization of the Company with
or into any other corporation or corporations in which the Company is not
the surviving entity (other than a mere reincorporation transaction), a
sale of all or substantially all of the assets of the Company or a
transaction or series of related transactions in which the Company issues
shares representing more than 50% of the voting power of the Company,
immediately after giving effect to such transaction or series of related
transactions, to a person or persons or other entity or entities who were
not shareholders of the Company immediately prior to such transaction.
3.4 Civic, Trade Organization and Club Dues. Subject to quarterly review
of the Compensation Committee with respect to ongoing business expenses, the
Company shall pay for or reimburse the Executive for dues paid in connection
with his membership in civic organizations or trade organizations which promote
the image or Business of the Company or establish, maintain or expand the
interface and relationship between the Company and various communities; and for
Executive's dues at clubs utilized by Executive or made available by Executive
and other management to entertain customers, vendors and others with whom the
Company or ▇▇▇▇▇ has business relations, or for other Company-related business
activities, entertainment and functions.
3.5 Vacation. The Executive shall receive not less than thirty (30)
working days paid vacation during each twelve (12) month period of the Term. The
Executive shall give the Board members at least five (5) days prior written or
oral notice before commencing each vacation period. To the extent that any
annual vacation provided herein is not taken during the year in which it
accrued, such unused vacation time shall be carried forward to the following
year not to exceed twenty (20) working days per year, and provided that
Executive shall not have more than fifty (50) working days of accrued and unused
vacation at any one time.
3.6 Health Plans. The Executive shall be eligible to participate in the
Company's health plans, in accordance with their terms, which the Company now or
hereafter has in effect and which are generally made available to the Company's
other employees, and the Company shall make contributions for Executive's
participation in such plans as it generally makes for its other employees. The
Company reserves the right to modify, add to or eliminate any or all of its
fringe benefit plans at any time and for any reason.
3.7 Insurance.
3.7.1 Life Insurance. The Company shall continue to maintain at no
cost to the Executive, except as provided in this Section 3.8.1, those
life insurance policies with respect to the Executive which are set forth
on Schedule 3.8. The Executive may borrow such amounts as are permitted
under the terms of such life insurance policies; provided, however, that
on and after the Effective Time the Executive shall be solely responsible
for
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repayment of such borrowed amounts, interest thereon and payment of any
resulting increase(s) in the Company's premium payment and shall give
advance written notice to the Board of his intention to borrow such
amounts.
3.7.2 Errors and Omissions. The Company shall provide directors' and
officers' liability and errors and omissions coverage for the Executive in
an amount and under terms consistent with those provided other Company
officers and directors.
3.7.3 Disability. If the Executive is determined to be disabled
under the Company's short-term disability plan or long-term disability
plan ("Disability Plan"):
(a) The Company shall pay to the Executive, through
insurance or otherwise, an amount equal to one hundred
percent (100%) of the Executive's Base Salary plus the
maximum amount of the Personal Incentive Bonus for a
period of one year from and after the occurrence of the
disability as determined under the Disability Plan. The
sum of amounts paid by the Company under this Section
3.7.3(a) shall be reduced by the Executive's total
income during such period from: social security,
workers' compensation, compensation from the Company or
any other business entity which controls, or is
controlled by, or is under common control with the
Company including, but not limited to, any Disability
Plan benefits and earned income from employment in any
capacity ("Offset Amount").
(b) Commencing on the three hundred sixty-sixth (366th)
consecutive calendar day from and after the Executive's
disability as determined under the Disability Plan, the
Company shall pay to the Executive, through insurance or
otherwise, an amount equal to seventy-five percent (75%)
of the Executive's Base Salary plus the maximum amount
of the Personal Incentive Bonus. The sum of amounts paid
by the Company under this Section 3.7.3(b) shall be
reduced by the Offset Amount plus all of the Executive's
proceeds from the sale of Company stock.
(c) The Company's obligation to make payments, as set forth
in Sections 3.7.3(a) and (b), to the Executive during
the Executive's period of disability shall cease upon
the later of the termination of the Term or three (3)
years from the commencement of the disability as
described in the first sentence of this Section 3.7.3.
(d) The Executive's Base Salary and vacation accrual shall
cease during payments under Section 3.7.3(a) and (b),
but all other benefits of this Agreement shall continue.
The Executive's Base Salary and
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vacation accrual shall recommence upon the cessation of
the Executive's disability during the Term, and said
Base Salary shall be the amount as set forth in Section
3.1 of this Agreement.
3.8 Car. The Company shall provide the Executive with one Company or ▇▇▇▇▇
employee as a driver on a full-time basis, and a car of similar quality and
status as a Mercedes Benz, 4 door sedan, model 420SEL, or successor model, as
available in North America. Such services and car shall be paid for or provided
by the Company, directly or indirectly, by such method deemed appropriate by the
Compensation Committee.
3.9 Administrative Assistant. The Company shall provide as necessary the
services of a personal administrative assistant based in the Company's offices,
who is paid consistent with a clerical level Company position to assist the
Executive in personal finances, social functions and other matters in order to
enhance Executive's ability to focus on the Business of the Company.
3.10 Reimbursement of Expenses. The Company shall reimburse the Executive
for all reasonable expenses incurred by the Executive in performing his duties
hereunder, including without limitation, expenditures for entertainment, travel,
lodging, and meals; provided, however, the Executive shall submit to the Company
verification of the nature and amount of such expenses in accordance with
Company policies and procedures as established from time to time by the
Compensation Committee, including audit, related to expense reimbursement of
employees.
3.11 Miscellaneous. The salary, compensation and benefits set forth in
this Section 3 shall not preclude or exclude the payment of any other or
additional compensation to the Executive by the Company (as determined by the
Compensation Committee of the Company) for serving as an officer, director,
Board committee member or in any other capacity for the Company to which he is
appointed or elected by the Board and which is not specifically covered by this
Agreement.
3.12 Repayment Upon Disallowance. Any salary, commission, expense,
reimbursement or other payment to the Executive by the Company pursuant to this
Section 3 which is disallowed in whole or in part as a deductible expense to the
Company for federal or state income tax purposes shall be promptly repaid to the
Company by the Executive to the full extent of such disallowance, but without
the payment by the Executive of any interest or penalty incurred by the Company
in connection with the disallowance of any such payment as a deductible expense
for the Company.
4. Termination/Extension.
4.1 Definition of "Cause." For purposes of this Agreement, Cause shall
mean: (i) felony conviction of the Executive in connection with his employment,
judgment against the Executive in a civil action brought by the Company relating
to fraud or diversion or conversion of Company assets by the Executive, or other
felony conviction of the Executive involving moral turpitude; (ii) failure by
the Executive to perform the duties of his employment set forth in this
Agreement or failure to follow lawful policies of the Company or lawful and
reasonable directives
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of the Board; or (iii) violation of Section 5, 6 or 7 of this Agreement. The
Executive shall be given sixty (60) days written notice by the Board of an
occurrence of a failure or violation of Section 4.1 (ii) or (iii) and shall be
provided an opportunity to cure, if possible, and/or to cease and desist, as
appropriate; provided, however, that if such failure or violation (or a
substantially related failure or violation) occurs more than three (3) times
during any six (6) month period, there shall be no further notice.
4.2 Definition of "Total Disability." For the purposes of this Section 4
only, "Total Disability" shall mean the Executive's disability pursuant to the
Company's Disability Plan for a period of at least one hundred eighty (180)
consecutive calendar days. Total Disability shall be deemed to have occurred on
the first (1st) day following said one hundred eighty (180) calendar day period.
4.3 Termination Events.
The Term shall be terminated with respect to Executive's employment
as set forth below and only for the following reasons:
4.3.1 By mutual agreement of the Board and the Executive;
4.3.2 At the election of and by the Executive, upon a breach
of the Agreement by the Company;
4.3.3 At the election of and by the Board for Cause, as defined in
Section 4.1, with an opportunity to cure and/or cease and desist, as
appropriate, as provided by said Section 4.1;
4.3.4 Automatically three (3) full calendar years after the
Effective Time.
4.3.5 Automatically upon the Executive's death;
4.3.6 At the election of and by the Board upon the Executive's Total
Disability as defined in Section 4.2 of this Agreement; or
4.3.7 In the event that, after the Effective Time, the Executive is
not re-elected to serve on the Board of Directors of the Company, then
Executive's title as Chairman shall cease and Executive shall for the remainder
of the Term be deemed an employee of the Company with such title, responsibility
and authority as may be delegated to him by the Board of Directors; provided,
however, that all other aspects of this Agreement shall continue to be in effect
in accordance with their terms.
4.4 Severance Payments Upon Termination Events. The Executive shall
receive no severance payment upon the occurrence of the termination of the
Executive's employment pursuant to Section 4.3; provided, however, in the event
of termination in accordance with Section 4.3.5,
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the Executive's estate shall receive an amount equal to three-twelfths (3/12ths)
of Executive's Base Salary.
5. Restrictive Covenants.
5.1 During the Term. During the Term, the Executive shall not, either
directly or indirectly, on his own behalf or as a partner, officer, director,
employee, consultant, agent or trustee of any person, firm, corporation,
partnership or other entity, engage in or be employed by any business or
enterprise which is the same as, or substantially the same as, the Business of
the Company ("Competing Business").
5.2 After the Term. For a period of eighteen (18) months after the Term
(the "Restricted Period"), the Executive shall keep, observe and abide by each
of the following separate covenants:
5.2.1 Except on behalf of the Company, the Executive shall not,
either directly or indirectly, on his own behalf or as a partner, officer,
director, employee, consultant, agent or trustee of any person, firm,
corporation, partnership or other entity, within the Area, as defined in
Section 5.3, engage in or be employed by or have any interest in any
business organization of whatever form engaged, either directly or
indirectly, in a Competing Business in a capacity that requires him to
perform services on behalf of such Competing Business substantially
similar to those performed by him on behalf of the Company; provided,
however, that the Executive may during the Restricted Period interview and
seek to make arrangements for such employment, engagement or interest that
commences after the Restricted Period.
5.2.2 During the Restricted Period, except on behalf of the Company,
the Executive shall not, either directly or indirectly, on his own behalf
or in the service or on behalf of others, solicit, divert or hire away, to
any Competing Business or attempt to solicit, divert or hire away, to any
Competing Business any person or persons employed by the Company as of the
termination of the Term or within the six (6) months preceding or
subsequent to the termination of the Term, whether or not such employee is
a full-time employee or a temporary employee of the Company, and whether
or not such employment is pursuant to a written contract with the Company
or is for a determined period or at will, until such employee has ceased
his employment with the Company for at least six (6) months.
5.3 Definition of "Area". The "Area" is defined as the geographic
territory included in a radius of fifty (50) miles from ▇▇▇▇▇' business location
in Norcross, Georgia and the Company's business location in Gaithersburg,
Maryland.
5.4 No Prior Restrictions. The Executive affirms and represents that he is
under no obligation to any former employer or third party which is inconsistent
with, or which imposes any
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restriction upon, the continued employment of the Executive by the Company or
the Executive's undertakings under this Agreement.
5.5 Survival. The provisions of this Section 5 shall continue after the
Term as set forth herein and shall survive irrespective of the reason the
Executive's employment terminates.
6. Ownership, Non-Disclosure and Non-Use of Confidential Information.
6.1 Definition of Confidential Information. For purposes of this Section
6, "Confidential Information" shall mean any and all data and information
relating to the Business of the Company (whether constituting a trade secret or
not), (i) which is or has been disclosed to the Executive, or of which the
Executive becomes aware as a consequence of or through his employment
relationship with the Company, or which was developed in whole or in part by him
during the term of his employment with the Company; and (ii) which has value to
the Company and is not generally known by its competitors. Confidential
Information shall not include any data or information (A) that has been
voluntarily disclosed to the public by the Company or has become generally known
to the public (except where such public disclosure has been made by the
Executive or another person or entity without authorization by the Company), or
(B) that has been independently developed and disclosed by parties other than
the Executive or the Company to the public generally or to the Executive without
breach of any obligation of confidentiality by any such parties running directly
or indirectly to the Company, or (C) that otherwise enters the public domain
through lawful means. Confidential Information may include, but is not limited
to, information relating to the Company's financial affairs (including the
Company's relationship with its investors and lenders), products, processes,
services, customers, employees, executives' compensation, research, development,
inventions, manufacturing, purchasing, accounting, engineering and marketing.
6.2 Definition of Trade Secrets. For the purposes of this Section 6, Trade
Secrets shall mean, in addition to the information described in the Georgia
Trade Secrets Act, (i) any Invention, as defined herein, which is being used or
studied by the Company and is not described in a printed patent, described in
any literature already published and distributed externally by the Company, and
which is not readily ascertainable from inspection of a product of the Company,
(ii) any engineering, technical, or product specifications including those of
features to be used, or use of which is contemplated, in a future product of the
Company; and (iii) any machine, process or method of manufacturing employed by
the Company, whether patentable or not, which is not generally known to
competitors of the Company. Trade Secrets shall not include any data or
information (A) that has been voluntarily disclosed to the public by the Company
or has become generally known to the public (except when such public disclosure
has been made by Executive or another person or entity without authorization by
the Company), or (B) that has been independently developed and disclosed by
parties other than the Executive or the Company to the public generally or to
the Executive without a breach of any obligation of non-disclosure by any such
parties running directly or indirectly to the Company, or (C) that otherwise
enters the public domain through lawful means.
- 10 -
6.3 Ownership. The Executive acknowledges and agrees that all Confidential
Information and Trade Secrets, and all physical embodiments thereof, are
confidential to and are and shall remain the sole and exclusive property of the
Company, and that any of the Confidential Information or Trade Secrets produced
by him shall be considered proprietary to the Company. The Executive agrees: (i)
immediately to disclose solely to the Company all Confidential Information and
Trade Secrets developed in whole or in part by him during the term of his
employment with the Company; (ii) to assign to the Company any right, title or
interest he may have in such Confidential Information and Trade Secrets, and
(iii) at the request and expense of the Company, to do all things and sign all
documents or instruments reasonably necessary in the opinion of the Company to
eliminate any ambiguity as to the ownership by and rights of the Company in such
Confidential Information and Trade Secrets including, without limitation,
providing to the Company his full cooperation in any litigation, unless between
the Executive and the Company after termination of Executive's employment, or
other proceeding to establish, protect or obtain such ownership and rights. Upon
request by the Company, and in any event upon termination of his employment with
the Company for any reason, the Executive shall promptly deliver to the Company
all property belonging to the Company, including, without limitation, all
Confidential Information and Trade Secrets (and all embodiments thereof) then in
his custody, control or possession.
6.4 Non-Disclosure. The Executive agrees that, during the term of his
employment by the Company and (i) at all times following the termination of such
employment for any reason whatsoever, with respect to Trade Secrets under the
Georgia Trade Secrets Act and (ii) during the Restricted Period with respect to
other Confidential Information, he will not use, disclose or make available,
directly or indirectly, any Confidential Information or Trade Secrets to any
person, concern or entity, except in the performance of his duties and
responsibilities hereunder or with the prior written consent of the Company. The
provisions of this Section 6 shall continue after the Term as provided herein
and shall survive irrespective of the reason the Executive's employment
terminates.
7. Inventions and Trademarks.
7.1 Definition of Invention and Executive Invention.
7.1.1 For the purposes of this Section 7, Invention shall mean any
discovery, whether or not patentable, including, but not limited to, any
useful process, method, formula, technique, machine, manufacture,
composition of matter, algorithm or computer program, as well as
improvements thereto, which is new or which the Executive has a reasonable
basis to believe may be new.
7.1.2 For the purposes of this Section 7, Executive Invention shall
mean any Invention which is conceived by the Executive or conceived by the
Executive in a joint effort with others during the Executive's employment
by the Company which (i) may be reasonably expected to be used in a
current product of the Company, a projected future product of the Company,
or a product similar to a Company product; (ii) results from work
- 11 -
that the Executive has been assigned as part of his duties as an
employee, officer or director of the Company; (iii) is in an area of
technology which is the same or substantially related to the areas of
technology with which the Executive is involved in the performance of the
Executive's duties as an employee, officer or director of the Company;
(iv) is useful, or which may reasonably be expected to be useful, in any
manufacturing process, product design or internal control system of the
Company; or (v) is in an area of technology which includes machinery or
processes with which the Executive normally works in performing his duties
as an employee, officer or director of the Company.
7.2 Property of the Company. The Executive hereby agrees that all
Executive Inventions shall become the property of the Company. The Company makes
no claim of rights to any Inventions of the Executive which are not Executive
Inventions, except to the extent that, by operation of law, the "shop rights
doctrine" provides the Company with any such rights.
7.3 Conception of Invention. The Executive hereby agrees that if he
conceives any Invention during his employment, for which there is a reasonable
basis to believe that the conceived Invention may be an Executive Invention, the
Executive will provide notice containing a written description of the Invention
to each Board member, adequate to allow evaluation thereof by the Board for a
determination of whether the Invention is an Executive Invention. In the event
of any dispute regarding such determination, the dispute shall be resolved
pursuant to Section 9 hereof.
7.4 Patent Registration. The Executive hereby agrees that should the
Company elect to file any application for patent protection either in the United
States or in any foreign country on an Executive Invention, the Executive will
execute all necessary papers and documents, including formal assignments to the
Company, relating to such patent application. The Executive further agrees that
he will cooperate with any attorneys or other persons designated by the Company
by explaining the nature of the Executive Invention, reviewing applications and
other papers, and providing any other assistance reasonably required for the
orderly prosecution of the patent applications.
7.5 Discontinuance of Use. On or after the termination of the Term, the
Executive may request that the Board approve the transfer or assignment to the
Executive of a (i) patent or an Executive invention which existed during the
Term but has not been practiced or used for a period of one (1) year or more
prior to the Executive's request therefor or (ii) trademark, service ▇▇▇▇ or
tradename which was owned by the Company during the Term but has not been used
for a period of one (1) year or more prior to the Executive's request therefor.
The Board shall make a determination with respect to such transfer or assignment
and the value thereof in its sole discretion.
7.6 Survival. The provisions of this Section 7 shall continue after the
Term as provided herein and shall survive irrespective of the reason for the
Executive's termination.
- 12 -
8. Breach of Covenants by Executive.
The Executive agrees that the covenants and agreements contained in
Sections 5, 6 and 7 of this Agreement are of the essence of this Agreement and
that each of such covenants is reasonable and necessary to protect and preserve
the interests and properties of the Company and the Business of the Company. The
Executive further agrees that the Company is engaged in and through the Area in
the Business of the Company and that irreparable loss and damage will be
suffered by the Company should the Executive breach any of such covenants and
agreements. Each of such covenants and agreements is separate, distinct and
severable not only from the other of such covenants and agreements but also from
the other and remaining provisions of this Agreement and the unenforceability of
any such covenant or agreement shall not affect the validity or enforceability
of any other such covenants or agreements or any other provision or provisions
of this Agreement. The Executive acknowledges that damages are inadequate for
any breach of Sections 5, 6 or 7, and that the Company shall, whether or not it
is pursuing any potential remedies at law, be entitled to equitable relief in
the form of both temporary and permanent injunctions to prevent a breach or
contemplated breach by the Executive of any of such covenants or agreements. The
Executive shall further be liable for damages, if any, resulting from any breach
of such covenants and agreements.
9. Resolution of Disputes.
9.1 Resolution of Disputes and Mediation. Except for the matters set forth
in Sections 5, 6, and 7 hereof, any dispute between the parties either with
respect to the interpretation of any provision of this Agreement or with respect
to the performance by the Executive or by the Company hereunder (the "Dispute")
shall be resolved in accordance with this Section 9 as follows:
9.1.1 Upon the written request of either party hereto, each of the
parties shall appoint a designated representative, whose task it shall be
to meet for the purpose of endeavoring to resolve the Dispute. The
Company's designated representative shall be a member of the Board
excluding (i) the Executive and (ii) the Board member selected by the
Executive to be a Board member.
9.1.2 The designated representatives shall meet as often as
necessary to gather and furnish to the other all information with respect
to the Dispute which is appropriate and germane in connection with its
resolution.
9.1.3 Such representatives shall discuss the Dispute and negotiate
in good faith in an effort to resolve the Dispute without the necessity of
any formal proceeding relating thereto.
9.1.4 During the course of such negotiations all reasonable requests
made by one party to the other for non-privileged information reasonably
related to the Dispute, shall be honored in order that each of the parties
may be fully advised of the other's position.
- 13 -
9.1.5 The specific format for such discussions shall be left to the
discretion of the designated representatives but may include the
preparation of agreed upon statements of fact or written statements of
position furnished to the other party.
9.2 Judicial Resolution. If the parties hereto are not able to resolve the
Dispute concerning this Agreement as set forth in Section 9.1 above within sixty
(60) calendar days, upon the initial written request as provided in Section
9.1.1, then the parties shall have the option and right to resolve such Dispute
by judicial or other equitable resolution.
10. Miscellaneous.
10.1 Key Man Insurance. The Executive agrees that during the Term, the
Company in its sole discretion may purchase in addition to those specified in
Section 3.9.1 insurance policies on the Executive's life with the Company as the
primary beneficiary, provided that all costs of such insurance are paid by the
Company.
10.2 Assignment. This Agreement may not be assigned by any party hereto
without the prior written agreement of the other party hereto.
10.3 Severability. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such provision shall be enforced to the
maximum extent permissible so as to effect the intent of the parties, and the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
10.4 Beneficiary. All of the terms and provisions of this Agreement shall
be binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors, heirs, executors, administrators and
permitted assigns.
10.5 Entire Agreement. This Agreement embodies the entire agreement of the
parties hereto relating to the subject matter hereof. This Agreement supersedes
all prior and contemporaneous agreements, understandings, negotiations and
discussions, written or oral, of the parties hereto, relating to the subject
matter of this Agreement. Nothing in this Agreement is intended or shall confer
upon or give any person other than the parties hereto any rights or remedies
under or by reason of this Agreement.
10.6 No Amendments. No amendments or modifications of this Agreement shall
be valid or binding upon the Company unless made in writing and approved by the
Board and signed by a Board member duly authorized by the Board (other than a
Board member designated by the Executive or the Executive), or upon the
Executive unless made in writing and signed by the Executive.
10.7 Waiver. The waiver by either party hereto of a breach by the other
party of any provision of this Agreement shall not operate or be construed as a
waiver of any subsequent breach of the same or any other provision by the
breaching party.
- 14 -
10.8 Notices. Any notice required or permitted to be given hereunder shall
be in writing and delivered personally or by facsimile/telecopy transmission.
Any notice delivered personally shall be deemed given as of the date of
delivery. Notice given by facsimile/telecopy shall be evidenced by the
facsimile/telecopy verification confirming that the notice was satisfactorily
transmitted and received and shall be deemed given as of the date of
confirmation; provided, however, that its receipt shall be confirmed by
telephone and all notices sent by facsimile/telecopy transmission must be
thereafter transmitted to the party to be notified by an overnight express mail
delivery service within three (3) days of said facsimile/telecopy transmission.
AS TO THE COMPANY:
▇▇▇▇▇ Communications Inc.
______ Peachtree ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile: (770) __________
AS TO EXECUTIVE:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ Communications Inc.
_____ Peachtree ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Private Fax: (▇▇▇) ▇▇▇-▇▇▇▇
AS TO ▇▇▇▇▇:
▇▇▇▇▇ Microcomputer Products, Inc.
_____ Peachtree ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile: (770) ____________
10.9 Headings. The enumeration and headings contained in this Agreement
are for convenience of reference only and are not intended to have any
substantive significance in interpreting this Agreement.
10.10 Number. Unless the context otherwise requires, whenever used in this
Agreement, the singular shall include the plural and the plural shall include
the singular.
10.11 Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia.
- 15 -
10.12 Counterparts. This Agreement may be executed in four (4)
counterparts and each of such counterparts, when duly executed, shall be deemed
an original document.
IN WITNESS WHEREOF, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, the Executive, and the Company,
acting by and through its duly authorized officers, have hereunto executed,
delivered and sealed this Agreement effective as of the Effective Time.
EXECUTIVE:
(SEAL)
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Private Fax: (▇▇▇) ▇▇▇-▇▇▇▇
COMPANY:
ATTEST: ▇▇▇▇▇ COMMUNICATIONS INC.
BY:
--------------------------------------
Name:
---------------------------------
[CORPORATE SEAL]
Title:
-------------------------- --------------------------------
Secretary
The undersigned ▇▇▇▇▇ Microcomputer Products, Inc.,is made a
signatory hereto for the sole purpose of terminating the Employment Agreement
dated April 16, 1996, pursuant to paragraph 2 of this Agreement.
▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
By:
--------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
- 16 -
SCHEDULE 3.8 TO EMPLOYMENT AGREEMENT
LIFE INSURANCE POLICIES
Policy Number
& Company Policy Date Policy Owner Beneficiary
------------- ----------- ------------ -----------
1. Amer. United Life 04/18/84 Company Company
#▇-▇▇▇-▇▇▇▇
2. Amer. United Life 08/18/86 Executive Estate of Executive
#▇-▇▇▇-▇▇▇▇
3. Amer. United Life 04/18/84 Company Company
#▇-▇▇▇-▇▇▇
4. Confederation Life 06/28/92 Company Estate of Executive
# 542 0411
5. Security Life 07/08/92 Company Estate of Executive
# 001045302
July 24, 1997 Draft
Exhibit 1.5A
CERTIFICATE OF OFFICER
OF ACCESS BEYOND, INC.
The undersigned officer of Access Beyond, Inc., a Delaware
corporation ("Acquirer"), and _________________, a Georgia corporation
("Newco"), on behalf of Acquirer and Newco, respectively, after consulting with
legal counsel and financial auditors regarding the meaning of and the factual
support for the following representations, hereby represent, in connection with
the proposed merger of ▇▇▇▇▇ Microcomputer Products, Inc., a Georgia corporation
("Target"), with and into Newco, with Target surviving the merger and with
Target shareholders receiving solely Acquirer voting stock in the merger,
intended to qualify as a reorganization described in ss. 368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended (the "Code"), by virtue of the
provisions of ss. 368(a)(2)(E), collectively referred to as the "Merger,"
pursuant to that certain Agreement and Plan of Reorganization by and between
Acquirer, Newco and Target, dated as of _______________, 1997, and Exhibits
thereto (collectively the "Agreement"),(1) that to the best of their knowledge
and belief the following facts are now true, correct and complete; and will
continue to be true, correct and complete as of the Effective Time for the
Merger and thereafter, as relevant.
1. Newco is a newly-formed corporation that was created for the sole
purpose of facilitating Acquirer's acquisition of Target. It has not conducted
and is not conducting any business activities. Newco will hold only those assets
necessary for it to effect the Merger.
2. Following the transaction, Target will hold at least 90% of the
fair market value of its net assets, at least 70% of the fair market value of
its gross assets, at least 90% of the fair market value Newco's net assets, and
at least 70% of the fair market value of Newco's gross assets held immediately
prior to the transaction. For purposes of this representation, amounts paid by
Target or Newco to dissenters, amounts paid by Target or Newco to shareholders
who receive cash or other property, amounts used by Target or Newco to pay
reorganization expenses, all redemptions and distributions (except for regular,
normal dividends) made by Newco, and Newco assets disposed of by Newco prior to
the Merger and in contemplation thereof (including without limitation any asset
disposed of by Newco, other than in the ordinary course of business, during the
period ending on the Effective Time and beginning with the commencement of
negotiations, whether formal or informal, between Target and Acquirer regarding
the Merger (the "Pre-Merger Period")), will be included as assets of Target or
Newco, respectively, immediately prior to the transaction.
3. Prior to the Merger, Acquirer will be in Control of Newco. As
used herein, "Control" shall mean ownership of stock possessing at least 80% of
the total combined voting power of all classes of stock entitled to vote and at
least 80% of the total combined voting power of all classes of stock entitled to
vote and at least 80% of the total number of shares of all other classes of
stock of the corporation. For purposes of determining Control, a person shall
not be considered to own voting stock if rights to vote such stock (or to
restrict or otherwise control the voting of such
----------
(1) Unless otherwise indicated, all capitalized terms shall have the
meaning defined in the Agreement.
stock) are held by a third party (including a voting trust) other than an agent
of such person.
4. Acquirer will acquire Control of Target in the Merger solely in
exchange for Acquirer voting stock.
5. The Conversion Ratio as defined in paragraph 1.1.5 of the
Agreement is the result of arm's length bargaining. The fair market value of the
Acquirer voting common stock to be received by shareholders to Target will be
approximately equal to the fair market value of the Target common stock and
Target Series A preferred stock to be surrendered in exchange therefor. The fair
market value of the Acquirer Series A preferred stock to be received by
shareholders of Target will be approximately equal to the fair market value of
the Target Series B Preferred Stock to be surrendered in exchange therefor. The
fair market value of the substituted Acquirer options to be received by the
Target option holders will be approximately equal to the fair market value of
the Target options to be assumed in exchange therefor. The fair market value of
the substituted Acquirer warrants to be received by the Target warrant holders
will be approximately equal to the fair market value of the Target warrants to
be assumed in exchange therefor.
6. The Acquirer common stock to be exchanged for Target common stock
in the Merger will be newly issued Acquirer stock.
7. Acquirer has no plan or intention to cause Target to issue, after
the Merger, additional shares of stock (or rights to acquire shares of Target
stock) that would result in Acquirer losing Control of Target.
8. Acquirer has no plan or intention to reacquire any of its voting
stock issued in the Merger. For purposes of this representation, it should be
noted that Acquirer may from time to time repurchase some of its issued and
outstanding stock in open market repurchase transactions. Acquirer has no plan
or intention to make any extraordinary distribution with respect to its voting
stock issued in the Merger.
9. Acquirer has no plan or intention to: (a) cause Target to sell,
transfer or otherwise dispose of any of its assets or any of the assets acquired
from Newco except for dispositions made in the ordinary course of business or
for the payment of expenses incurred by Target in the Merger; (b) liquidate
Target; (c) merge Target with or into another corporation including Acquirer or
its affiliates; or (d) to sell, distribute or otherwise dispose of the stock of
Target.
10. In the Merger, Newco will have no liabilities assumed by Target
and will not transfer to Target any assets subject to liabilities.
11. Acquirer intends that, immediately following the Merger, Target
will continue its historic business or use a significant portion of its historic
business assets in a business.
2
12. Neither Acquirer nor any Acquirer subsidiary owns, or has owned
during the past five years, directly or indirectly, any shares of Target stock,
or the right to acquire or vote any such stock.
13. No shareholder of Target is acting as agent for Acquirer in
connection with the Merger or approval thereof.
14. The transfer of cash to Target shareholders in lieu of
fractional Acquirer voting common stock shares, if any, is solely for the
purpose of avoiding the expense and inconvenience to Acquirer of accounting for
fractional shares and does not represent separately bargained-for consideration.
15. Except with respect to payments of cash to Target shareholders
in lieu of fractional shares of Acquirer voting stock and cash paid for Target
Dissenting Shares, if any, 100% of the Target stock outstanding immediately
prior to the Merger will be exchanged solely for Acquirer voting stock. In any
event, the total consideration other than Acquiring voting stock received by
Target Shareholders will be less than 20% of the total fair market value of the
Target stock outstanding immediately prior to the Merger. Thus, except as set
forth in the preceding sentences, Acquirer intends that no consideration other
than Acquirer voting stock be paid or received (directly or indirectly, actually
or constructively) for Target stock.
16. No shares of Newco have been or will be used as consideration or
issued to shareholders of Target in the Merger.
17. Newco and Acquirer will each pay separately its own expenses in
connection with the Merger as contemplated by the Agreement.
18. There is no inter-corporate indebtedness existing between
Acquirer and Target or between Newco and Target that was issued, acquired, or
will be settled at a discount, and Acquirer will assume no liabilities of Target
or any Target shareholder in connection with the Merger.
19. None of the payments to be received by any shareholder of Target
that are designated as compensation are actually separate consideration for, or
allocable to, any of their shares of Target stock, and the compensation to be
paid to any shareholder of Target will be for services actually rendered and
will be commensurate with amounts paid to third parties bargaining at arm's
length for similar services.
20. Neither Acquirer nor Newco are investment companies as defined
in ss. 368(1)(2)(F) of the Code.
21. The Merger is to be carried out for a substantial business
purpose.
22. Acquirer and Newco are authorized to make all of the
representations set forth
3
herein, and the undersigned are authorized to execute this certificate on behalf
of Acquirer and Newco.
The undersigned recognize that counsel to and auditors for Target
and counsel to and auditors for Acquirer and Newco will rely upon the foregoing
representations in evaluating the U.S. federal income tax consequences of the
Merger.
ACCESS BEYOND, INC. (ACQUIRER) (NEWCO)
------------------------------
By: By:
-------------------------------- --------------------------------
Name: Name:
------------------------------ ------------------------------
Title: Title:
----------------------------- -----------------------------
Date: Date:
------------------------------ ------------------------------
4
July 24, 1997 Draft
Exhibit 1.5B
CERTIFICATE OF OFFICER
OF ▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC.
The undersigned officer of ▇▇▇▇▇ Microcomputer Products, Inc., a
Georgia corporation ("Target"), on behalf of the management of Target, after
consulting with legal counsel and financial auditors regarding the meaning of
and the factual support for the following representations, hereby represent, in
connection with the proposed merger of Target with and into _________________, a
Georgia corporation ("Newco"), a wholly owned subsidiary of Access Beyond, Inc,
a Delaware corporation ("Acquirer"), with Target surviving the merger and with
Target shareholders receiving solely Acquirer voting stock in the merger,
intended to qualify as a reorganization described in ss. 368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended (the "Code"), by virtue of the
provisions of ss. 368(a)(2)(E), collectively referred to as the "Merger,"
pursuant to that certain Agreement and Plan of Reorganization by and between
Acquirer, Newco and Target, dated as of _______________, 1997, and Exhibits
thereto (collectively the "Agreement"),(1) that to the best of their knowledge
and belief the following facts are now true, correct and complete; and will
continue to be true, correct and complete as of the Effective Time for the
Merger and thereafter, as relevant.
1. At least 90% of the fair market value of its net assets and at
least 70% of the fair market value of the gross assets held by Target
immediately before the Merger during the Pre-Merger Period will be held by
Target immediately after the Merger. For the purpose of determining the
percentage of the net and gross assets held by Target immediately before the
Merger for purposes of this representation, the following assets will be treated
as property held by Target immediately prior but not subsequent to the Merger:
(a) assets disposed of by Target prior to the Merger and in contemplation
thereof (including without limitation any asset disposed of by Target, other
than in the ordinary course of business, during the period ending on the
Effective Time of the Merger and beginning with the commencement of negotiations
(whether formal or informal) between Target and Acquirer regarding the merger
(the "Pre-Merger Period")), (b) assets used by Target to pay expenses or
liabilities incurred in connection with the Merger, and (c) assets used to make
distributions (except for regular and normal dividends), redemption or other
payments in respect of Target stock or rights to acquire such stock (including
payments treated as such for tax purposes) that are made in contemplation of the
merger or related thereto.
2. Target has made no transfer of any of its assets (including any
distribution of assets with respect to, or in redemption of, stock) in
contemplation of the Merger or during the Pre-Merger Period other than (a) in
the ordinary course of business, and (b) payments for expenses incurred in
connection with the Merger.
----------
(1) Unless otherwise indicated, all capitalized terms shall have the
meaning defined in the Agreement.
3. In the Merger, shares of Target stock representing Control of
Target will be exchanged solely for voting stock of Acquirer; at the time of the
Merger, there will exist no rights of any kind (including without limitation,
warrants, options, convertible securities, contingent rights, informal or
unwritten rights) to acquire Target stock or to vote (or restrict or otherwise
control the vote of) Target stock, which, if exercised, could affect Acquirer's
acquisition and retention of Control of Target. For purposes of this
representation, shares of Target stock exchanged in the Merger for cash and
other property will be treated as Target stock outstanding on the date of the
Merger but not exchanged for voting stock of Acquirer. As used herein, the term
"Control" shall mean ownership of stock possessing at least 80% of the total
combined voting power of all classes of stock entitled to vote and at least 80%
of the total number of shares of all other classes of stock of the corporation.
For purposes of determining Control, a person shall not be considered to own
voting stock if rights to vote such stock (or to restrict or otherwise control
the voting of such stock) are held by a third party (including a voting trust)
other than an agent of such person.
4. At the Effective Time of the Merger, there will be no accrued but
unpaid dividends on shares of Target stock.
5. The Conversion Ratio as defined in paragraph 1.1.5 of the
Agreement is the result of arm's length bargaining. The fair market value of the
Acquirer voting common stock to be received by shareholders of Target will be
approximately equal to the fair market value of the Target common stock and
Target Series A voting preferred stock to be surrendered in exchange therefor.
The fair market value of the Acquirer Series A preferred stock to be received by
shareholders of Target will be approximately equal to the fair market value of
the Target Series B preferred stock to be surrendered in exchange therefor. The
fair market value of the substituted Acquirer options to be received by the
Target option holders will be approximately equal to the fair market value of
the Target options to be assumed in exchange therefor. The fair market value of
the substituted Acquirer warrants to be received by the Target warrant holders
will be approximately equal to the fair market value of the Target warrants to
be assumed in exchange therefor.
6. At the Effective Time of the Merger, the fair market value of the
assets of Target will exceed the sum of its liabilities, plus the amount of
liabilities, if any, to which its assets are subject.
7. Target has no obligation, understanding, agreement or intention
to issue additional shares of stock after the Merger that would result in
Acquirer losing Control of Target.
8. Target has no plan or intention, and is under no obligation, to
discontinue its business, to sell or otherwise dispose of any of its assets or
of any of the assets acquired from Newco in the Merger except for dispositions
made in the ordinary course of business or the payment of expenses incurred by
Target pursuant to the Merger.
9. There is no plan or intention on the part of any Target
shareholder who owns 5% or more of Target stock or is an officer or director of
Target, and to the knowledge of the
2
management of Target, there is no plan or intention on the part of the remaining
Target shareholders to engage in a sale, exchange, transfer, distribution,
pledge, disposition or any other transaction which would result in a direct or
indirect disposition (a "Sale") of shares of Acquirer voting stock to be issued
to Target shareholders in the Merger, which shares would have an aggregate fair
market value, as of the Effective Time of the Merger, in excess of 50% of the
aggregate fair market value, immediately prior to the Merger, of all outstanding
shares of Target stock. For purposes of this representation, shares of Target
stock (or the portion thereof) (a) with respect to which a Target shareholder
receives consideration in the Merger other than Acquirer voting common stock
and/or (b) with respect to which a Sale by a Target shareholder who owns 5% or
more of Target stock or is an officer or director of Target occurs during the
Pre-Merger Period shall be considered shares of outstanding Target stock
exchanged for Acquirer voting stock in the Merger and then disposed of pursuant
to a prearranged plan.
10. Target has no plan or intention to immediately reacquire any of
the voting stock issued to its shareholders in the Merger.
11. Target intends that, immediately following the Merger, Target
will continue its historic business or use a significant portion of its historic
business assets in a business.
12. The transfer of cash to Target shareholders in lieu of
fractional Acquirer voting common stock shares, if any, is solely for the
purpose of avoiding the expense and inconvenience to Acquirer of accounting for
fractional shares and does not represent separately bargained-for consideration
by the Target Shareholders.
13. Except with respect to payments of cash to Target shareholders
in lieu of fractional shares of Acquirer voting stock and cash paid for Target
Dissenting Shares, if any, 100% of the Target stock outstanding immediately
prior to the Merger will be exchanged solely for Acquirer voting stock. In any
event, the total consideration other than Acquiring voting stock received by
Target Shareholders will be less than 20% of the total fair market value of the
Target stock outstanding immediately prior to the Merger. Thus, except as set
forth in the preceding sentences, Acquirer intends that no consideration other
than Acquirer voting stock be paid or received (directly or indirectly, actually
or constructively) for Target stock.
14. Target and the shareholders of Target will each pay separately
its or their own expenses in connection with the Merger as contemplated by the
Agreement.
15. There is no inter-corporate indebtedness existing between
Acquirer and Target or between Newco and Target that was issued, acquired, or
will be settled at a discount, and the knowledge of the management of Target,
Acquirer will assume no liabilities of Target or any Target shareholder in
connection with the Merger.
3
16. There is no indebtedness existing between Target and any Target
shareholder which will be repaid in connection with or as part of the Merger, or
will be specifically funded with amounts Acquirer would contribute to Target
subsequent to the Merger.
17. None of the payments to be received by any shareholder of Target
which have been designated as compensation are actually separate consideration
for, or allocable to, any of their shares of Target stock; and the compensation
paid to any shareholder of Target will be for services actually rendered and
will be commensurate with amounts paid to third parties bargaining at arm's
length for similar services.
18. Target is not an investment company as defined in ss.
368(a)(2)(F) of the Code, and is not under the jurisdiction of a court in a
Title 11 or similar case within the meaning of ss. 368(a)(3)(A) of the Code.
19. The Merger is to be carried out for a substantial business
purpose.
20. Target is authorized to make all of the representations set
forth herein, and the undersigned are authorized to execute this certificate on
behalf of Target.
The undersigned recognize that counsel to and auditors for Target
and counsel to and auditors for Acquirer and Newco will rely upon the foregoing
representations in evaluating the federal income tax consequences of the Merger.
▇▇▇▇▇ MICROCOMPUTER PRODUCTS, INC. (TARGET)
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Date:
-------------------------------------
4
EXHIBIT 7.13
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
ACCESS BEYOND, INC.
(Originally Incorporated on July 23, 1996)
ARTICLE I
The name of the Corporation is ▇▇▇▇▇ Communications Inc.
ARTICLE II
The address of the registered office of the Corporation in the State of
Delaware is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇. The
name of its registered agent at that address is The Corporation Trust Company.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of the
State of Delaware.
ARTICLE IV
The total number of shares of all classes of stock which the Corporation
has authority to issue is one hundred million (100,000,000) shares, consisting
of two classes: __________________ (__________) shares of Common Stock, $.01 par
value per share, and __________________ (__________) shares of Preferred Stock,
$.01 par value per share. __________________ (____(1)____) shares of the
Preferred Stock are designated as Series A Preferred Stock.
The Board of Directors is authorized, subject to any limitations
prescribed by the law of the State of Delaware, to provide for the issuance of
the shares of Preferred Stock in one or more series, and, by filing a
certificate of designation pursuant to the applicable law of the State of
Delaware, to establish from time to time the number of shares to be included in
each such series, to fix the designation, powers, preferences and rights of the
shares of each such wholly unissued series and any qualifications, limitations
or restrictions thereof, and to increase or decrease the number of shares of any
such series (but not below the number of shares of such series then
outstanding). The number of authorized shares of Preferred Stock may also be
increased or
----------
(1) This number will be equal to the number of shares of Series A
Preferred Stock issued in exchange for the ▇▇▇▇▇ Series B Preferred Stock.
decreased (but not below the number of shares thereof then outstanding) by the
affirmative vote of the holders of a majority of the stock of the Corporation
entitled to vote, unless a vote of any other holders is required pursuant to a
certificate or certificates establishing a series of Preferred Stock.
Except as otherwise expressly provided in Article V or in any Certificate
of Designation designating any series of Preferred Stock pursuant to the
foregoing provisions of this Article IV, any new series of Preferred Stock may
be designated, fixed and determined as provided herein by the Board of Directors
without approval of the holders of the Common Stock or the holders of Preferred
Stock, or any series thereof, and any such new series may have powers,
preferences and rights, including, without limitation, voting rights, dividend
rights, liquidation rights, redemption rights and conversion rights, senior to,
junior to or pari passu with the rights of the Common Stock, the Preferred
Stock, or any future class or series of Preferred Stock or Common Stock.
ARTICLE V
The rights, preferences, privileges and restrictions granted to and
imposed on the Series A Preferred Stock and the Common Stock are as follows:
1. Dividend Rights. The holders of Series A Preferred Stock shall be
entitled to receive, as and when declared by the Board, but only out of funds
legally available therefor, cumulative compounding dividends at the dividend
rate of ten percent (10%) per annum of $______. [this blank will equal the
original issue price per share of ▇▇▇▇▇ Series B Preferred Stock ($20.9036)
divided by the Conversion Ratio] Dividends shall accrue quarterly as if such
dividends had commenced to accrue on April 24, 1997, provided, however, that in
the event of conversion of the Series A Preferred Stock (as set forth in Section
3), dividends shall be accrued through the day immediately prior to such
conversion. Subject to the restrictions set forth in this Section 1, dividends
accumulated on the Series A Preferred Stock shall be declared by the Board and
paid on the Redemption Date provided that the Redemption Request is provided as
set forth in Section 7. Such dividends shall be paid in cash upon redemption, or
in additional shares of Common Stock upon conversion of the Series A Preferred
Stock as provided in Section 3 below. Dividends accumulated on the Series A
Preferred Stock shall be declared by the Board and paid in cash every three (3)
months to the extent permitted by law. No dividends may be paid on the Common
Stock unless all accrued and unpaid dividends on the Series A Preferred Stock
are paid.
2. Voting Rights.
(a) Common Stock. Each holder of shares of Common Stock shall be
entitled to one (1) vote for each share thereof held.
(b) Preferred Stock. Each holder of shares of Series A Preferred
Stock shall be entitled to the number of votes equal to the number of
whole shares of Common Stock into which such shares of Series A Preferred
Stock could be converted pursuant to the
2
provisions of Section 3 below at the record date for the determination of
the shareholders entitled to vote on such matters or, if no such record
date is established, the date such vote is taken or any written consent of
shareholders is solicited.
(c) Vote Required. Subject to the foregoing provisions of this
Section 2, each holder of Preferred Stock shall have full voting rights
and powers equal to the voting rights and powers of the holders of Common
Stock, and shall be entitled to notice of any shareholders' meeting in
accordance with the bylaws of the Company (as in effect at the time in
question) and applicable law, and shall be entitled to vote, together with
the holders of Common Stock, with respect to any question upon which
holders of Common Stock have the right to vote, except as may be otherwise
provided by applicable law. Except as otherwise required by law or by the
provisions of Section 5 of this Article V, the holders of Preferred Stock
and the holders of Common Stock shall vote together and not as separate
classes.
3. Conversion Rights. The holders of Series A Preferred Stock shall have
conversion rights as follows (the "Conversion Rights"):
(a) Right to Convert. Each share of Series A Preferred Stock shall
be convertible, at the option of the holder thereof, at any time after the
date of issuance of such share at the office of the Corporation or any
transfer agent for such stock, into such number of fully paid and
nonassessable shares of Common Stock as is determined by dividing US
$______ [this blank will equal $20.9036 divided by the Conversion Ratio]
by the Series A Conversion Price determined as hereinafter provided, in
effect on the date the certificate is surrendered for conversion. If any
holder elects to convert his shares of Series A Preferred Stock as
provided above, all unpaid and accrued dividends on the Series A Preferred
Stock existing immediately prior to the conversion of the Series A
Preferred Stock will be converted into such number of fully paid and
nonassessable shares of Common Stock as determined by dividing all unpaid
and accrued dividends by the Series A Conversion Price, determined as
hereinafter provided. The "Series A Conversion Price" shall initially be
US $__________ [this blank will equal $20.9036 divided by the Conversion
Ratio]. Such initial Series A Conversion Price shall be adjusted as
hereinafter provided.
(b) Automatic Conversion. Each share of Series A Preferred Stock
shall automatically be converted (as set forth below) into such number of
fully paid and nonassessable shares of Common Stock as determined by
dividing US $_____ [this blank will equal $20.9036 divided by the
Conversion Ratio] (adjusted for any stock splits, stock dividends, stock
combinations or similar events) plus the per share amount of all unpaid
and accrued dividends on the Series A Preferred Stock existing immediately
prior to the conversion of the Series A Preferred Stock by the Series A
Conversion Price, determined as hereinafter provided, in effect (i)
immediately prior to the consummation of a Qualified Public Offering (as
defined below) under the Securities Act of 1933, as amended (the
"Securities Act"); or (ii) at such time as the Corporation has registered
3
Common Stock pursuant to an underwritten public offering under the
Securities Act and (a) the Corporation has listed or would be qualified to
list its shares on the NASDAQ National Market System; (b) the average
market value of the Common Stock equals or exceeds the lesser of US
$_________ [this blank will equal $33.00 divided by the Conversion Ratio]
per share or two (2) times the then-current Series A Conversion Price (in
either such case as adjusted for stock splits, stock dividends, stock
combinations or similar events) determined by the median of the high and
low sales price each day for a consecutive twenty (20) day period; (c) the
aggregate market value of the shares of Common Stock held in the public
market equals or exceeds US $25,000,000, determined by the 20 trading day
average of the high and low sales price described in (b) above; and (d)
the holders of the Series A Preferred Stock have the unrestricted right at
such time to sell in a registered offering or pursuant to Rule 144 at
least one-half of the number of shares of Common Stock into which such
Series A Preferred Stock would be converted; or (iii) upon the affirmative
vote of holders of at least a majority of the Series A Preferred Stock
(any such event described in subsections (i), (ii) and (iii) above being
referred to herein as a "Series A Conversion Event"). All unpaid and
accrued dividends on the Series A Preferred Stock existing immediately
prior to the Series A Conversion Event shall automatically be converted
into such number of fully paid and nonassessable shares of Common Stock as
determined by dividing all unpaid and accrued dividends by the Series A
Conversion Price, determined as hereinafter provided, in effect
immediately prior to the Series A Conversion Event. As used herein,
"Qualified Public Offering" means an underwritten sale to the public of
Common Stock pursuant to an effective registration statement under the
Securities Act in connection with which (a) the gross proceeds to the
Corporation for the Common Stock actually sold to the public in such sale,
prior to deducting the amount of brokers' commissions and expense
allowances paid by the Corporation in connection with the original sale of
such Common Stock, is US $25,000,000 or more, and (b) the public offering
price per share (prior to underwriters' commissions and expenses) equals
or exceeds the lesser of (i) US $______ [This blank will equal $33.00
divided by the Conversion Ratio] per share or (ii) two (2) times the
then-current Series A Conversion Price, in either such case as adjusted
for stock splits, stock dividends, stock combinations or similar events.
Immediately prior to the Qualified Public Offering, or promptly upon the
occurrence of another Series A Conversion Event, each share of Series A
Preferred Stock shall be automatically converted, without cost, on the
terms of this Section 3(b), into the number of shares of Common Stock into
which such share of Series A Preferred Stock would be convertible under
Section 3 immediately prior to such Series A Conversion Event.
(c) Mechanics of Conversion.
(i) Before any holder of Series A Preferred Stock shall be
entitled to convert the same into shares of Common
Stock, such holder shall surrender the certificate or
certificates therefor, duly endorsed, at the office of
the Corporation or of any transfer agent for such stock,
and shall give written notice to the Corporation at such
office that
4
such holder elects to convert the same and shall state
therein the name or names in which such holder wishes
the certificate or certificates for shares of Common
Stock to be issued. The Corporation shall, as soon as
practicable thereafter, issue and deliver at such office
to such holder of Series A Preferred Stock, a
certificate or certificates for the number of shares of
Common Stock to which such holder shall be entitled as
aforesaid. Such conversion shall be deemed to have been
made immediately prior to the close of business on the
date of surrender of the shares of Series A Preferred
Stock to be converted, and the person or persons
entitled to receive the shares of Common Stock issuable
upon such conversion shall be treated for all purposes
as the record holder or holders of such shares of Common
Stock on such date.
(ii) If a conversion is in connection with an underwritten
offering of securities pursuant to the Securities Act,
the conversion may, at the option of any holder
tendering shares of Series A Preferred Stock for
conversion, be conditioned upon the closing with the
underwriters of the sale of securities pursuant to such
offering, in which event the person(s) entitled to
receive the Common Stock upon conversion of the Series A
Preferred Stock shall not be deemed to have converted
such Series A Preferred Stock until immediately prior to
the closing of such sale of securities.
(d) Adjustments to Conversion Price for Certain Diluting Issues.
(i) Special Definitions. For purposes of this Section 3(d),
the following definitions apply:
(A) "Options" shall mean rights, options or warrants
to subscribe for, purchase or otherwise acquire
either Common Stock or Convertible Securities
(defined below).
(B) "Original Issue Date" shall mean, with respect to
the Series A Preferred Stock, the date on which a
share of Series A Preferred Stock was first
issued.
(C) "Convertible Securities" shall mean any evidences
of indebtedness, shares (other than Common Stock
and Series A Preferred Stock) or other securities
convertible into or exchangeable for Common Stock.
(D) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued (or, pursuant to
Section 3(d)(iii),
5
deemed to be issued) by the Corporation after the
Original Issue Date, other than shares of Common
Stock issued or issuable:
(1) upon conversion of shares of Series A
Preferred Stock;
(2) up to _______ [this number will equal the
number of shares of Access Beyond Common
Stock currently subject to outstanding
options or reserved for future issuance,
plus 1,800,000 multiplied by the Conversion
Ratio] shares, subject to adjustment for all
stock splits, stock dividends, subdivisions
and combinations of shares of Common Stock
issued (or, pursuant to Section 3(d)(iii),
deemed to be issued) to officers and
employees of the Corporation pursuant to the
Corporation's stock option, purchase or
similar plans, or other options or warrants
as approved by the Corporation's Board of
Directors;
(3) as a dividend or distribution on Series A
Preferred Stock; and
(4) upon exercise or conversion of, or otherwise
pursuant to, securities of the Corporation
outstanding as of the Original Issue Date of
the Series A Preferred Stock (including any
securities assumed by the Corporation on
such date or otherwise assumed or issued in
connection with the transactions consummated
by the Corporation on such date).
(E) "Board" shall mean the Board of Directors of the
Corporation.
(ii) No Adjustment of Conversion Price. Any provision herein
to the contrary notwithstanding, no adjustment in the
Series A Conversion Price shall be made in respect of
the issuance of Additional Shares of Common Stock unless
the consideration per share (determined pursuant to
Section 3(d)(v) hereof) for an Additional Share of
Common Stock issued or deemed to be issued by the
Corporation is less than the Series A Conversion Price
in effect on the date of, and immediately prior to, such
issue.
6
(iii) Deemed Issue of Additional Shares of Common Stock. In
the event the Corporation at any time or from time to
time after the Original Issue Date of the Series A
Preferred Stock shall issue any Options or Convertible
Securities, then the maximum number of shares (as set
forth in the instrument relating thereto without regard
to any provisions contained therein designed to protect
against dilution) of Common Stock issuable upon the
exercise of such Options or the conversion or exchange
of such Convertible Securities, shall be deemed to be
Additional Shares of Common Stock issued as of the time
of such issue or, provided that in any such case in
which Additional Shares of Common Stock are deemed to be
issued:
(A) no further adjustments in the Series A Conversion
Price shall be made upon the subsequent issue of
Convertible Securities or shares of Common Stock
upon the exercise of such Options or conversion or
exchange of such Convertible Securities;
(B) if such Options or Convertible Securities by their
terms provide, with the passage of time or
otherwise, for any increase or decrease in the
consideration payable to the Corporation, or
decrease or increase in the number of shares of
Common Stock issuable, upon the exercise,
conversion or exchange thereof, the Series A
Conversion Price computed upon the original issue
thereof, and any subsequent adjustments based
thereon, shall, upon any such increase or decrease
becoming effective, be recomputed to reflect such
increase or decrease insofar as it affects such
Options or the rights of conversion or exchange
under such Convertible Securities (provided,
however, that no such adjustment of the Series A
Conversion Price shall affect the Common Stock
previously issued upon conversion of the Series A
Preferred Stock);
(C) upon the expiration of any such Options or any
rights of conversion or exchange under such
Convertible Securities which shall not have been
exercised, the Series A Conversion Price computed
upon the original issue thereof (or upon the
occurrence of a record date with respect thereto),
and any subsequent adjustments based thereon,
shall, upon such expiration, be recomputed as if:
(1) in the case of Convertible Securities or
Options for Common Stock, the only
Additional Shares of
7
Common Stock issued were the shares of
Common Stock, if any, actually issued upon
the exercise of such Options or the
conversion or exchange of such Convertible
Securities and the consideration received
therefor was the consideration actually
received by the Corporation for the issue of
all such Options, whether or not exercised,
plus the consideration actually received by
the Corporation upon such exercise, or for
the issue of all such Convertible Securities
which were actually converted or exchanged,
plus the additional consideration, if any,
actually received by the Corporation upon
such conversion or exchange, and
(2) in the case of Options for Convertible
Securities, only the Convertible Securities,
if any, actually issued upon the exercise
thereof were issued at the time of issue of
such Options, and the consideration received
by the Corporation for the Additional Shares
of Common Stock deemed to have been then
issued was the consideration actually
received by the Corporation for the issue of
all such Options, whether or not exercised,
plus the consideration deemed to have been
received by the Corporation (determined
pursuant to Section 3(d)(v)) upon the issue
of the Convertible Securities with respect
to which such Options were actually
exercised;
(D) no readjustment pursuant to clause (B) or (C)
above shall have the effect of increasing the
Series A Conversion Price to an amount which
exceeds the lower of (1) the Series A Conversion
Price on the original adjustment date, or (2) the
Series A Conversion Price that would have resulted
from any issuance of Additional Shares of Common
Stock between the original adjustment date and
such readjustment date; and
(E) in the case of any Options which expire by their
terms not more than thirty (30) days after the
date of issue thereof, no adjustment of the Series
A Conversion Price shall be made until the
expiration or exercise of all such Options,
whereupon such adjustment shall be made in the
same manner provided in clause (C) above.
8
(iv) Adjustment of Series A Conversion Price Upon Issuance of
Additional Shares of Common Stock. In the event this
corporation, at any time after the Original Issue Date
shall issue Additional Shares of Common Stock (including
Additional Shares of Common Stock deemed to be issued
pursuant to Section 3(d)(iii)), without consideration or
for a consideration per share less than US $______ [this
blank will equal $20.9036 divided by the Conversion
Ratio] per share but equal to or greater than US $______
[this blank will equal $7.14 divided by the Conversion
Ratio] per share (in each case as adjusted for any stock
splits, stock dividends, stock combinations or similar
events) then and in such event, the Series A Conversion
Price shall be reduced concurrently with such issue, to
a price equal to the lowest per share consideration
received by the Corporation for any of the Additional
Shares of Common Stock. If such price per share of
Additional Shares is less than US $________ [this blank
will equal $7.14 divided by the Conversion Ratio]
(adjusted for any stock splits, stock dividends, stock
combinations or similar events) then and in such event,
the Series A Conversion Price shall first be reduced to
US $_______ [this blank will equal $7.14 divided by the
Conversion Ratio] and then the Series A Conversion Price
shall be further reduced, concurrently with such issue,
to a price (calculated to the nearest cent) determined
by multiplying such Series A Conversion Price by a
fraction, (i) the numerator of which shall be the number
of shares of Common Stock issuable upon conversion of
the shares of the Series A Preferred Stock actually
issued and outstanding (or deemed issued pursuant to
Section 3(d)(iii)) immediately prior to such issue plus
the quotient obtained by dividing (x) the aggregate
consideration received by the Corporation for the total
number of Additional Shares of Common Stock so issued
(or deemed issued pursuant to Section 3(d)(iii)) by (y)
the Series A Conversion Price in effect immediately
prior to such issuance, and (ii) the denominator of
which shall be the number of shares of Common Stock
issuable upon conversion of the shares of the Series A
Preferred Stock actually issued and outstanding (or
deemed issued pursuant to Section 3(d)(iii)) immediately
prior to such issue plus the number of such Additional
Shares of Common Stock so issued (or deemed issued
pursuant to Section 3(d)(iii)).
(v) Determination of Consideration. For purposes of this
Section 3(d), the consideration received by the
Corporation for the issue of any Additional Shares of
Common Stock shall be computed as follows:
(A) Cash and Property. Such consideration shall:
9
(1) insofar as it consists of cash, be computed
at the aggregate amount of cash received by
the Corporation (without deducting any
discounts or commissions paid by the
Corporation);
(2) insofar as it consists of property other
than cash, be computed at the fair value
thereof at the time of such issue, as
determined in good faith by the Board; and
(3) in the event Additional Shares of Common
Stock are issued together with other shares
or securities or other assets of the
Corporation for consideration which covers
both, be the proportion of such
consideration so received, computed as
provided in clauses (1) and (2) above, as
determined in good faith by the Board.
(B) Options and Convertible Securities. The
consideration per share received by the
Corporation for Additional Shares of Common Stock
deemed to have been issued pursuant to Section
3(d)(iii), relating to Options and Convertible
Securities shall be determined by dividing:
(1) the maximum amount, if any, received or
receivable by the Corporation as
consideration for the issue of such Options
or Convertible Securities, plus the minimum
aggregate amount of additional consideration
(as set forth in the instruments relating
thereto, without regard to any provision
contained therein designed to protect
against dilution) payable to the Corporation
upon the exercise of such Options or the
conversion or exchange of such Convertible
Securities, or in the case of Options for
Convertible Securities, the exercise of such
Options for Convertible Securities and the
conversion or exchange of such Convertible
Securities, by
(2) the maximum number of shares of Common Stock
(as set forth in the instruments relating
thereto, without regard to any provision
contained therein designed to protect
against dilution) issuable upon the exercise
of such Options or conversion or exchange of
such Convertible Securities.
10
(e) Adjustments for Stock Dividends, Subdivisions, or Split-ups of
Common Stock. If the number of shares of Common Stock outstanding at any time
after the filing of this Restated Certificate of Incorporation is increased by a
stock dividend payable in shares of Common Stock or by a subdivision or split-up
of shares of Common Stock, then, effective at the close of business upon the
record date fixed for the determination of holders of Common Stock entitled to
receive such stock dividend, subdivision or split-up, the Series A Conversion
Price shall be appropriately decreased so that the number of shares of Common
Stock issuable on conversion of each share of Series A Preferred Stock shall be
increased in proportion to such increase of outstanding shares of Common Stock.
(f) Adjustments for Combinations of Common Stock. If the number of
shares of Common Stock outstanding at any time after the filing of this Restated
Certificate of Incorporation is decreased by a combination of the outstanding
shares of Common Stock, then, effective at the close of business upon the record
date of such combination, the Series A Conversion Price shall be appropriately
increased so that the number of shares of Common Stock issuable on conversion of
each share of Series A Preferred Stock shall be decreased in proportion to such
decrease in outstanding shares of Common Stock.
(g) Adjustments for Other Distributions. In the event the
Corporation at any time or from time to time makes, or fixes a record date for
the determination of holders of Common Stock entitled to receive any
distribution payable in securities of the Corporation other than shares of
Common Stock, then and in each such event provision shall be made so that the
holders of Series A Preferred Stock shall receive upon conversion thereof, in
addition to the number of shares of Common Stock receivable thereupon, the
amount of securities of the Corporation which they would have received had their
Series A Preferred Stock been converted into Common Stock on the date of such
event and had they thereafter, during the period from the date of such event to
and including the date of conversion, retained such securities receivable by
them as aforesaid during such period, subject to all other adjustments called
for during such period under this Section 3(g) with respect to the rights of the
holders of the Series A Preferred Stock.
(h) Adjustments for Reorganizations, Reclassifications, etc. If the
Common Stock issuable upon conversion of the Series A Preferred Stock shall be
changed into the same or a different number of shares of any other class or
classes of stock or other securities or property, whether by reclassification, a
merger or consolidation of this corporation with or into any other corporation
or corporations, or a sale of all or substantially all of the assets of this
corporation (but only if the stockholders of this corporation hold more than
fifty percent (50%) of the outstanding voting equity securities of the surviving
corporation in such merger, consolidation or sale of assets reorganization), or
otherwise (other than a subdivision or combination of shares provided for above
or a merger or other transaction referred to in Section 4(c) below) the Series A
Conversion Price then in effect shall, concurrently with the effectiveness of
such reorganization or reclassification, be proportionately adjusted such that
the Series A Preferred Stock shall be convertible into, in lieu of the number of
shares of Common Stock which the holders would otherwise have been entitled to
receive, a number of shares of such other class or classes of stock or
securities or other property equivalent to the number of shares of Common Stock
that would
11
have been subject to receipt by the holders upon conversion of the Series A
Preferred Stock immediately before such event; and, in any such case,
appropriate adjustment (as determined by the Board) shall be made in the
application of the provisions herein set forth with respect to the rights and
interests thereafter of the holders of the Series A Preferred Stock, to the end
that the provisions set forth herein (including provisions with respect to
changes in and other adjustments of the Series A Conversion Price) shall
thereafter be applicable, as nearly as may be reasonable, in relation to any
shares of stock or other property thereafter deliverable upon the conversion of
the Series A Preferred Stock. In the event of any conflict between this Section
3(h) and Section 4(b), Section 4(b) shall be controlling.
(i) No Impairment. The corporation will not, except by a properly
approved amendment of its Certificate of Incorporation, through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but will at all times in good faith assist in the
carrying out of all the provisions of this Section 3 and in the taking of all
such action as may be necessary or appropriate in order to protect the
Conversion Rights of the holders of the Series A Preferred Stock against
impairment.
(j) Certificates as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Series A Conversion Price pursuant to this
Section 3, the Corporation at its expense shall promptly compute such adjustment
or readjustment in accordance with the terms hereof and prepare and furnish to
each holder of Series A Preferred Stock, a certificate executed by the
Corporation's President/Chief Executive Officer or Treasurer/Chief Financial
Officer setting forth such adjustment or readjustment and showing in detail the
facts upon which such adjustment or readjustment is based. The corporation
shall, upon the written request at any time of any holder of Series A Preferred
Stock, furnish or cause to be furnished to such holder a like certificate
setting forth (A) such adjustments and readjustments, (B) the Conversion Price
at the time in effect, and (C) the number of shares of Common Stock and the
amount, if any, of other property which at the time would be received upon the
conversion of the Series A Preferred Stock.
(k) Notices of Record Date. In the event that the Corporation shall
propose at any time: (a) to declare any special dividend or distribution upon
its Common Stock, whether in cash, property, stock or other securities, whether
or not out of earnings or earned surplus; (b) to offer to subscription pro rata
to the holders of any class or series of its stock any additional shares of
stock of any class or series or other rights; (c) to effect any reclassification
or recapitalization of its Common Stock outstanding involving a change in the
Common Stock; or (d) to merge or consolidate with or into any other corporation
(other than a mere reincorporation transaction), or sell, lease or convey all or
substantially all of its assets, or to liquidate, dissolve or wind up; then, in
connection with each such event, the Corporation shall send to the holders of
Series A Preferred Stock:
(A) at least twenty (20) days' prior written notice of the
date on which a record shall be taken for such dividend,
distribution or
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subscription rights (and specifying the date on which
the holders of Common Stock shall be entitled thereto)
or for determining rights to vote, if any, in respect of
the matters referred to in (c) and (d) above; and
(B) in the case of the matters referred to in (c) and (d)
above, at least twenty (20) days' prior written notice
of the date when the same shall take place (and
specifying the date on which the holders of Common Stock
shall be entitled to exchange their Common Stock for
securities or other property deliverable upon the
occurrence of such event).
(l) Issue Taxes. The corporation shall pay any and all issue and
other taxes that may be payable in respect of any issue or delivery of shares of
Common Stock on conversion of Series A Preferred Stock pursuant hereto;
provided, however, that the Corporation shall not be obligated to pay any
transfer taxes resulting from any transfer requested by any holder in connection
with any such conversion.
(m) Reservation of Stock Issuable Upon Conversion. The corporation
shall at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Series A Preferred Stock, such number of its shares of Common
Stock as shall from time to time be sufficient to effect the conversion of all
outstanding shares of the Series A Preferred Stock; and if at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of all then outstanding shares of the Series A
Preferred Stock, the Corporation will take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including, without limitation, engaging in its best efforts to obtain
the requisite stockholder approval of any necessary amendment to the Certificate
of Incorporation.
(n) Fractional Shares. No fractional share shall be issued upon the
conversion of any share or shares of Series A Preferred Stock. All shares of
Common Stock (including fractions thereof) issuable upon conversion of more than
one share of Series A Preferred Stock by a holder thereof shall be aggregated
for purposes of determining whether the conversion would result in the issuance
of any fractional share. If, after the aforementioned aggregation, the
conversion would result in the issuance of a fraction of a share of Common
Stock, the Corporation shall, in lieu of issuing any fractional share, pay the
holder otherwise entitled to such fraction a sum in cash equal to the fair
market value of such fraction on the date of conversion (as determined in good
faith by the Board).
(o) Notices. Any notice required by the provisions of this Section 3
to be given to the holders of shares of Series A Preferred Stock shall be given
in writing and it or any certificates or other documents delivered hereunder
shall be deemed effectively given or delivered (as the case may be) upon
personal delivery; when deposited with a recognized international
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courier, five (5) days after deposit (or if earlier, upon delivery against a
signed receipt therefor); when transmitted by telecopy, which transmission is
confirmed, at the address appearing on the books of the Corporation.
4. Liquidation Rights.
(a) In the event of any liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, the holder of each share of
the Series A Preferred Stock then outstanding shall be entitled to receive out
of the remaining assets of the Corporation available for distribution to
stockholders, and before any payment or declaration and setting apart for
payment of any amount shall be made in respect of Common Stock, an amount equal
to $________. [this blank will equal the original issue price per share of ▇▇▇▇▇
Series B Preferred Stock ($20.9036) divided by the Conversion Ratio] (which
amount shall be adjusted proportionately in the event the shares of Series A
Preferred Stock are subdivided into a greater number or combined into a lesser
number) plus an amount equal to any accrued but unpaid dividends through the
date of such liquidation, dissolution or winding up of the Corporation (the
"Series A Preferred Stock Liquidation Preference"). If, upon any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
the assets to be distributed to the holders of Series A Preferred Stock shall be
insufficient to permit the payment of the full Series A Preferred Stock
Liquidation Preference pursuant to this Section 4(a), then all of the remaining
assets of the Corporation to be distributed shall be distributed ratably to the
holders of Series A Preferred Stock.
(b) A merger, consolidation or reorganization of the Corporation
with or into any other corporation or corporations that results in the transfer
of fifty percent (50%) or more of the outstanding voting stock of the
Corporation (other than a transaction effected primarily for the purpose of
changing the domicile of the Corporation), a sale of all or substantially all of
the assets of the Corporation, or a transaction or series of related
transactions (other than a public offering of the Corporation's securities,
following which a majority of the Board is comprised of those persons who were
members of the Board prior to such offering) in which the Corporation issues
shares representing more than fifty percent (50%) of the voting power of the
Corporation immediately after giving effect to such transaction, shall be
treated as a liquidation, dissolution or winding up for purposes of this Section
4. Any securities to be delivered to the holders of the Series A Preferred Stock
and Common Stock pursuant to such event shall be valued as follows:
(i) Securities not subject to investment letter or other
similar restrictions on free marketability:
(A) If traded on a securities exchange or reported on
a national inter dealer quotation system, the
value shall be deemed to be the average of the
closing prices of the securities on such exchange
over the 30-day period ending three (3) days prior
to the closing;
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(B) If actively traded over the counter and not
reported on a national inter dealer quotation
system, the value shall be deemed to be the
average of the closing bid prices over the 30-day
period ending three (3) days prior to the closing;
and
(C) If there is no active public market, the value
shall be the fair market value thereof, as
determined in good faith by the Board.
(ii) The method of valuation of securities subject to
investment letter or other restrictions on free
marketability shall be to make an appropriate discount
from the market value determined as above in (i)(A), (B)
or (C) to reflect the approximate fair market value
thereof, as determined in good faith by the Board.
(c) In the event of a transaction (or series of related
transactions) to be treated as a liquidation pursuant to this Section 4, the
Corporation shall give each holder of record of Series A Preferred Stock written
notice of such impending transaction not later than twenty (20) days prior to
the stockholders' meeting called to approve such transaction, or twenty (20)
days prior to the closing of such transaction, whichever is earlier, and shall
also notify such holders in writing of the final approval of such transaction.
The first of such notices shall describe the material terms and conditions of
the impending transaction and the provisions of this Section 4, and the
Corporation shall thereafter give such holders prompt notice of any material
changes. The transaction shall in no event take place sooner than twenty (20)
days after the Corporation has given the first notice provided for herein or
sooner than ten (10) days after the Corporation has given notice of any material
changes provided for herein; provided, however, that such periods may be
shortened upon the written consent of the holders of a majority of the shares of
Series A Preferred Stock.
5. Restrictions and Limitations. So long as any of the Series A Preferred
Stock remain outstanding, this corporation shall not, without first obtaining
the approval (by vote or written consent, as provided by law) of the holders of
at least a majority of the total number of shares of Series A Preferred Stock
outstanding:
(i) alter or change the rights, preferences or privileges of the
Series A Preferred Stock;
(ii) increase the aggregate number of authorized shares of Series A
Preferred Stock (other than an increase pursuant to a stock
split) or decrease the aggregate number of authorized shares
of Series A Preferred Stock below the number of shares of
Series A Preferred Stock then outstanding;
(iii) authorize or issue, or obligate itself to issue, any other
equity security senior to or on a parity with the Series A
Preferred Stock as to dividends
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or assets in liquidation or create or reclassify any
obligation or security convertible into or exchangeable for,
or having any option rights to purchase, any such equity
security other than shares of capital stock issuable upon
conversion or exercise of securities outstanding as of the
Original Issue Date of the Series A Preferred Stock;
(iv) take any action which results in the redemption of, or payment
of dividends or the distribution of cash or any property with
respect to, any shares of Common Stock (other than pursuant to
(x) Section 4(a); (y) payments made to a stockholder who is
not a stockholder of the Corporation as of the Original Issue
Date of the Series A Preferred Stock in connection with an
acquisition or merger transaction by the Corporation which is
not deemed to be a liquidation pursuant to Section 4(b) above;
or (z) redemptions of employee or director owned stock or
options);
(v) incur or guarantee any indebtedness other than (a) in the
ordinary course of business; (b) under the Loan and Security
Agreement dated December 21, 1995, by and between ▇▇▇▇▇
Microcomputer Products, Inc., an affiliate of the Corporation
and The CIT Group/Credit Finance, Inc., as amended thereafter,
or any replacement credit facility with a commercial lender
under which the Corporation or its subsidiaries maintains its
primary borrowing relationship; (c) indebtedness existing as
of the Original Issue Date of the Series A Preferred Stock;
(d) in an amount not to exceed $2,000,000 in the aggregate; or
(e) in connection with an acquisition or merger transaction by
the Corporation which is not deemed to be a liquidation under
Section 4(b) above; or
(vi) approve or create any mortgage, pledge or security interest in
all or substantially all of the assets or property of the
Corporation, except for such security interests or liens
arising under the Corporation's borrowings permitted under
Subsection 5(v) above.
6. No Reissuance of Series A Preferred Stock. No share or shares of Series
A Preferred Stock acquired by the Corporation by reason of purchase, conversion
or otherwise shall be reissued, and all such shares shall be canceled, retired
and eliminated from the shares which the Corporation shall be authorized to
issue. The corporation may, from time to time, take such appropriate corporate
action as may be necessary to reduce the authorized number of shares of the
Series A Preferred Stock, but not below the number of shares of such Series then
outstanding.
7. Redemption.
(a) Redemption Date. "Redemption Date" means April 23, 2000, or such
other date determined in accordance with Section 7(b) or 7(c) below.
16
(b) Stockholder Redemption Request. Subject to the limitations set
forth herein and in Section 7(f) below, on ninety (90) days prior written notice
from the holders of more than fifty percent (50%) of the Series A Preferred
Stock ("Redemption Request") delivered to the Corporation not earlier than
November 1, 1999, the Corporation shall redeem all of the shares of Series A
Preferred Stock held by each holder as of the date of such notice by paying in
cash therefor, US $_________ [this blank will equal $20.9036 divided by the
Conversion Ratio] per share of Series A Preferred Stock (such amount to be
adjusted proportionately in the event the shares of Series A Preferred Stock are
subdivided into a greater number or combined into a lesser number and in the
event the Corporation at any time pays a dividend, or makes any other
distribution, to holders of Series A Preferred Stock payable in shares of Series
A Preferred Stock) plus all accrued but unpaid dividends on such shares (the
"Redemption Price") on such Redemption Date.
(c) Corporation Redemption Request. The corporation may, at its sole
option and discretion, at any time at which it has funds legally available to do
so, redeem all (or, if the holders of a majority of the outstanding Series A
Preferred Stock consent thereto, any part) of the Series A Preferred Stock upon
thirty (30) days prior written notice to the holders of the Series A Preferred
Stock, by paying the Redemption Price on the Redemption Date. Any partial
redemption hereunder shall be made pro rata among all holders of the Series A
Preferred Stock. Notwithstanding the foregoing, any holder of Series A Preferred
Stock may elect to convert to Common Stock all or any part of the Series A
Preferred Stock shares which the Corporation has elected to redeem by providing
written notice of its conversion election to the Corporation within twenty (20)
days after the date of the Corporation's redemption notice. In such event, those
shares of Series A Preferred Stock shall convert to Common Stock at the Series A
Conversion Price as provided in, and subject to the terms and conditions of
Section 3.
(d) Surrender of Certificates. On or before the Redemption Date,
each holder of shares of Series A Preferred Stock being redeemed shall surrender
the certificate or certificates representing such shares to the Corporation, at
the Corporation's principal place of business. Upon such surrender (but not
earlier than the Redemption Date) the Redemption Price for such shares shall be
payable to the order of the person whose name appears on such certificate or
certificates as the owner thereof, and each surrendered certificate shall be
canceled and retired. If a certificate is surrendered and all the shares
evidenced thereby are not being redeemed, the Corporation shall cause
certificates evidencing the shares not being redeemed to be issued in the name
of the registered owner of such shares and to be delivered to such person.
(e) Termination of Stock Rights. If the Corporation elects to redeem
the Series A Preferred Stock as provided above, or if a holder of Series A
Preferred Stock gives a Redemption Request and holds shares of Series A
Preferred Stock on the Redemption Date, and if on the Redemption Date the
Redemption Price is either paid or made available for payment through the
deposit arrangement specified in Section 7(f) below, then notwithstanding that
the certificates evidencing any of the shares of Series A Preferred Stock to be
redeemed shall not have been surrendered, all rights with respect to such shares
shall terminate as of the Redemption Date,
17
except only the right of the holder to receive the Redemption Price upon
surrender of the certificate evidencing such shares.
(f) Deposit of Redemption Price. On or prior to a Redemption Date,
the Corporation shall deposit with any bank or trust company in the United
States having a capital and surplus of at least US $50,000,000, as a trust fund,
a sum equal to the aggregate Redemption Price of all shares of Series A
Preferred Stock to be redeemed on the Redemption Date, with irrevocable
instructions and authority to the bank or trust company to pay, on or after the
Redemption Date or prior thereto, the Redemption Price to the respective holders
upon the surrender of their share certificates. From and after the date of such
deposit ("Redemption Deposit"), the shares so called for redemption shall be
redeemed. The deposit shall constitute full payment of the shares to their
holders, and from and after the Redemption Date the shares shall be deemed to be
no longer outstanding, and the holders thereof shall cease to be stockholders
with respect thereto and shall have no rights with respect thereto except the
rights to receive from the bank or trust company payment of the Redemption Price
of the shares, without interest, upon surrender of their certificates therefor.
Any funds so deposited and unclaimed at the end of one year from the Redemption
Date shall be released or repaid to the holders of the shares called for
redemption shall be entitled to receive payment of the Redemption Price with
respect to such shares only from the Corporation.
(g) Insufficient Funds. If the funds of the Corporation legally
available therefor shall be insufficient to discharge the redemption
requirements under Section 7(b) in full due on any Redemption Date, funds to the
maximum extent legally available for such purpose shall be set aside on or
before the Redemption Date in accordance with Section 7(b). The maximum number
of full shares of Series A Preferred Stock that can be redeemed with such funds
shall be redeemed ratably from the holders of shares of Series A Preferred Stock
to be redeemed as of the Redemption Date. Thereafter, the Corporation shall
redeem shares of Series A Preferred Stock ratably from the holders thereof as
funds legally available therefor become available. Dividends shall continue to
accrue on shares of Series A Preferred Stock scheduled to be redeemed on a
Redemption Date but not yet redeemed until funds sufficient to redeem such
shares become legally available therefor and are paid or set aside in accordance
with this Section 7.
ARTICLE VI
The Board of Directors of the Corporation shall have the power to adopt,
amend or repeal Bylaws of the Corporation.
ARTICLE VII
The number of directors shall be fixed from time to time exclusively
by the Board of Directors pursuant to a resolution adopted by the affirmative
vote of a majority of the entire Board of Directors. The directors shall be
divided into three classes, designated as Class I, Class II and Class III. Each
class shall consist, as nearly as possible, of one-third of the total number of
directors, initially, with the directors of Class I elected for a term of one
year, the directors of
18
Class II elected for a term of two years and the directors of Class III elected
for a term of three years. At each succeeding annual meeting of stockholders
following such classification and election, directors elected to succeed those
directors whose terms expire shall be elected for a three-year term.
Subject to the rights of the holders of any class or series of the
capital stock of the Corporation entitled to vote generally in the election of
directors (hereinafter in this Article VII and in the first proviso of Article
VIII of this Certificate of Incorporation, such stock is referred to as the
"Voting Stock") then outstanding, newly created directorships resulting from any
increase in the authorized number of directors or any vacancies in the Board of
Directors resulting from death, resignation, retirement, disqualification,
removal from office, or other cause may be filled only by a majority vote of the
directors then in office, though less than a quorum, and directors so chosen
shall hold office for a term expiring at the annual meeting of stockholders at
which the term of office of the class to which they have been elected expires.
No decrease in the number of authorized directors constituting the entire Board
of Directors shall shorten the term of any incumbent director. If the number of
directors is changed, any increase or decrease shall be apportioned among the
classes so as to maintain the number of directors in each class as nearly equal
as possible, and any additional director of any class elected to fill a vacancy
resulting from an increase in such class shall hold office for a term that shall
coincide with the remaining term of that class, but in no case will a decrease
in the number of directors shorten the term of any incumbent director. A
director shall hold office until the annual meeting for the year in which his
term expires and until his successor shall be elected and shall qualify,
subject, however, to prior death, resignation, retirement, disqualification or
removal from office.
Subject to the rights of the holders of any class or series of the
Voting Stock then outstanding, any director, or the entire Board of Directors,
may be removed from office at any time, but only for cause and only by the
affirmative vote of the holders of at least 80% of the voting power of all of
the then-outstanding shares of the Voting Stock, voting together as a single
class (it being understood that, for all purposes of this Article VII, and the
provisions of the By-Laws of the Corporation which require the affirmative vote
of the holders of at least 80% of the voting power of all of the
then-outstanding shares of the Voting Stock, voting together as a single class,
to alter, amend or repeal any provision of the By-Laws which is to the same
effect as the provisions of this Certificate of Incorporation enumerated in the
first proviso of Article VIII hereof, each share of the Voting Stock shall have
the number of votes granted to it pursuant to Article V of this Certificate of
Incorporation or any designation of the rights, powers and preferences of any
class or series of Preferred Stock made pursuant to said Article IV (a
"Preferred Stock Designation")).
Notwithstanding any other provisions of this Certificate of
Incorporation or any provision of law which might otherwise permit a lesser vote
or no vote, but in addition to any affirmative vote of the holders of any
particular class or series of the Voting Stock required by law, this Certificate
of Incorporation or any Preferred Stock Designation, the affirmative vote of the
holders of at least 80% of the voting power of all of the then-outstanding
shares of the Voting Stock, voting together as a single class, shall be required
to alter, amend or repeal this Article VII.
19
Notwithstanding the foregoing, whenever the holders of any one or
more classes or series of Preferred Stock issued by the Corporation shall have
the right, voting separately by class or series, to elect directors at an annual
or special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the
terms of this Certificate of Incorporation applicable thereto (including the
resolutions of the Board of Directors pursuant to Article IV), and such
Directors so elected shall not be divided into classes pursuant to this Article
VII unless expressly provided by such terms.
ARTICLE VIII
In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized:
To make, alter or repeal the bylaws of the Corporation;
provided, however, that notwithstanding any other provisions of the
Certificate of Incorporation or any provision of law which might
otherwise permit a lesser vote or no vote, but in addition to any
affirmative vote of the holders of any particular class or series of
the Voting Stock required by law, this Certificate of Incorporation
or any Preferred Stock Designation, the affirmative vote of the
holders of at least 80% of the voting power of all of the
then-outstanding shares of the Voting Stock, voting together as a
single class, shall be required to alter, amend or repeal (i) any
provision of the By-laws which is to the same effect as Article VII
of this Certificate of Incorporation, or (ii) this proviso of this
Article VIII.
To authorize and cause to be executed mortgages and liens upon
the real property of the Corporation.
To set apart out of any of the funds of the Corporation
available for dividends a reserve or reserves for any proper purpose
and to abolish any such reserve in the manner in which it was
created.
By a majority of the whole board, to designate one or more
committees, each committee to consist of one or more of the
directors of the Corporation.
When and as authorized by the stockholders in accordance with
this Certificate of Incorporation and applicable statutes, to sell,
lease or exchange all or substantially all of the property and
assets of the Corporation, including its goodwill and its corporate
franchises, upon such terms and conditions and for such
consideration (which may consist, in whole or in part, of money or
20
property, including shares of stock in, and/or other securities of,
any other corporation or corporations) as the Corporation's Board of
Directors shall deem appropriate and in the best interests of the
Corporation.
ARTICLE IX
To the fullest extent permitted by law, no director of the Corporation
shall be personally liable for monetary damages for breach of fiduciary duty as
a director. Without limiting the effect of the preceding sentence, if the
Delaware General Corporation Law is hereafter amended to authorize the further
elimination or limitation of the liability of a director, then the liability of
a director of the Corporation shall be eliminated or limited to the fullest
extent permitted by the Delaware General Corporation Law, as so amended.
Neither any amendment nor repeal of this Article IX, nor the adoption of
any provision of this Restated Certificate of Incorporation inconsistent with
this Article IX, shall eliminate, reduce or otherwise adversely affect any
limitation on the personal liability of a director of the Corporation existing
at the time of such amendment, repeal or adoption of such an inconsistent
provision.
This Amended and Restated Certificate of Incorporation was duly adopted in
accordance with the provisions of Section 245 of the General Corporation Law of
the State of Delaware.
IN WITNESS WHEREOF, this Amended and Restated Certificate of Incorporation
has been duly executed by the Corporation as of the ____ day of _________, 1997.
ACCESS BEYOND, INC.
BY:
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Name:
----------------------------
Title:
-------------------------
21