EXHIBIT 99(b)
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TENDER AGREEMENT
TENDER AGREEMENT, dated as of September 19, 1995, among
MCI COMMUNICATIONS CORPORATION, a Delaware corporation(the
"Parent"), 3183581 CANADA INC., a corporation incorporated under
the Canada Business Corporations Act (the "CBCA") and an
indirect, wholly owned subsidiary of the Parent (the
"Purchaser"), and WARBURG, XXXXXX INVESTORS, L.P., a Delaware
limited partnership the "Seller").
RECITALS
Concurrently herewith, the Parent, the Purchaser and SHL
SYSTEMHOUSE INC., a corporation incorporated under the CBCA (the
"Company"), are entering into an Acquisition Agreement dated the
date hereof (the "Acquisition Agreement"; terms used herein but
not otherwise defined herein shall have the meanings set forth in
the Acquisition Agreement), pursuant to which the Purchaser has
agreed to make an offer (the "Offer") to purchase all of the
Company's outstanding shares of common stock, without nominal or
par value (collectively the "Company Common Stock"), at a price
of U.S.$13 per share, subject to the terms and conditions set
forth in the Acquisition Agreement. In the event that the
Purchaser agrees to increase the per share amount to be offered
pursuant to the Offer, references herein to the Offer shall be
deemed to refer to the Offer contemplated by the Acquisition
Agreement at such increased price. In the event that the
Purchaser purchases shares of Company Common Stock pursuant to
the Offer, it intends to acquire the remainder of such shares
pursuant to the provisions of Section 206 of the CBCA, a
statutory arrangement, amalgamation or other transaction (the
"Transaction") for consideration identical to that offered under
the Offer.
As of the date hereof, the Seller beneficially owns
directly 8,865,705 shares of Company Common Stock (the "Existing
Shares" and, together with any shares of Company Common Stock
acquired after the date hereof and prior to the termination
hereof, whether upon the exercise of options, conversion of
convertible securities or otherwise, the "Shares").
As a condition to their willingness to enter into the
Acquisition Agreement and make the Offer, the Parent and the
Purchaser have required that the Seller agree, and the Seller has
agreed, to tender the Shares in the Offer and grant a proxy to
vote all of the Shares owned by the Seller on the terms and
conditions provided for herein.
EXHIBIT 99(b)
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AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Tender and Vote; Proxy. (a) Tender.
The Seller hereby agrees to validly tender pursuant to the Offer
all Shares and not withdraw any such Shares, except to the extent
that the tender of Shares (except with respect to Shares acquired
after the date hereof) pursuant to the Offer would subject any
profit realized on the transaction by the Seller to recovery by
the Company under Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act").
(b) Voting. The Seller hereby agrees that, from the
date hereof until the Expiration Date (as defined below), at any
meeting of the stockholders of the Company, however called, or in
any written consent in lieu thereof, the Seller shall vote (or
cause to be voted) the Shares (i) in favor of the execution and
delivery by the Company of the Acquisition Agreement and this
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Acquisition Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Acquisition Agreement or this Agreement;
and (iii) against any action or agreement (other than the
Acquisition Agreement or the transactions contemplated thereby)
that is intended, or could reasonably be expected, to impede,
interfere with, delay, postpone, discourage or materially
adversely affect the Offer, the Transaction, this Agreement or
the other transactions contemplated by the Acquisition Agreement,
including, but not limited to: (A) any extraordinary corporate
transaction, such as a merger, amalgamation, consolidation or
other business combination involving the Company or its
subsidiaries; (B) a sale, lease or transfer of a material amount
of assets of the Company and its subsidiaries, or a
reorganization, recapitalization or liquidation of the Company or
its subsidiaries; (C) any change in the management or board of
directors of the Company, except as otherwise agreed to in
writing by the Purchaser or the Parent; (D) any material change
in the present capitalization or dividend policy to the Company
or any amendment of the Company's Articles of Incorporation; or
(E) any other material change in the Company's corporate
structure or business. The Seller shall not enter into any
agreement or understanding with any person or entity prior to the
termination hereof to vote or give instructions after the
termination hereof in any manner inconsistent with clauses (i),
(ii) or (iii) of the preceding sentence.
EXHIBIT 99(b)
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(c) Proxy. THE SELLER HEREBY GRANTS TO, AND APPOINTS, THE
PARENT AND THE SECRETARY OF THE PARENT AND THE CHIEF FINANCIAL
OFFICER OF THE PARENT, IN THEIR RESPECTIVE CAPACITIES AS OFFICERS
OF THE PARENT, AND ANY INDIVIDUAL WHO SHALL HEREAFTER SUCCEED TO
ANY SUCH OFFICE OF THE PARENT, AND ANY OTHER DESIGNEE OF THE
PARENT, EACH OF THEM INDIVIDUALLY, THE SELLER'S IRREVOCABLE PROXY
AND ATTORNEY-IN-FACT (WITH FULL POWER OF SUBSTITUTION) TO VOTE
THE SHARES AS INDICATED IN SECTION 1(B). THE SELLER INTENDS THIS
PROXY TO BE IRREVOCABLE AND COUPLED WITH AN INTEREST AND WILL
TAKE SUCH FURTHER ACTION OR EXECUTE SUCH OTHER INSTRUMENTS AS MAY
BE NECESSARY TO EFFECTUATE THE INTENT OF THIS PROXY AND HEREBY
REVOKES ANY PROXY PREVIOUSLY GRANTED BY HIM WITH RESPECT TO THE
SHARES.
2. Expiration. This Agreement, the Parent's right to
vote the Shares covered hereby and the Seller's obligation to
tender the Shares pursuant hereto shall terminate on the
Expiration Date. As used herein, the term "Expiration Date"
means the first to occur of (a) the Effective Time (as defined in
the Acquisition Agreement), (b) termination of the Acquisition
Agreement in accordance with its terms and (c) written notice of
termination of this Agreement by the Parent to the Seller.
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser, jointly and severally hereby represent and warrant
to the Seller as follows:
(i) Corporate Organization. The Parent is a
coporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Purchaser is a
corporation duly organized, validly existing and in good standing
under the CBCA. Each of the Parent and the Purchaser has the
requisite corporate power and authority and any necessary
governmental authority to own,operate or lease its properties and
assets and to carry on its business as it is now being
conducted, except where the failure to be so organized, existing
and in good standing or to have such power, authority and
governmental approvals could not, individually or in the
aggregate, reasonably be expected to prevent the consummation of
the Offer, the Transaction or the other transactions contemplated
by the Acquisition Agreement.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power and
authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and performance of
this Agreement by the Parent and the Purchaser and the
consummation by the Parent and the Purchaser of the transactions
contemplated hereby have been duly and validly authorized by all
EXHIBIT 99(b)
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necessary corporate action on the part of the Parent and the
Purchaser. This Agreement has been duly executed and delivered
by each of the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Seller, constitutes
a legal, valid and binding obligation of each such corporation
enforceable against such corporation in accordance with its
terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the Purchaser do
not and will not: (A) conflict with or violate the respective
certificates of incorporation or by-laws of the Parent or the
Purchaser, as the case may be; (B)assuming that all consents,
approvals and authorizations contemplated by Section 3.3(b)(i) of
the Acquisition Agreement have been obtained and all filings
described in such section have been made, conflict with or
violate any law, rule, regulation, order, judgment or decree
applicable to the Parent or the Purchaser or by which either of
them or their respective properties or assets are bound or
affected; or (C) result in any breach or violation of or
constitute a default (or an event which with notice or lapse of
time or both could become a default) or result in the loss of a
material benefit under, or give rise to any right of termination,
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the properties or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which the
Parent or the Purchaser is a party or by which the Parent or the
Purchaser or any of their respective properties or assets are
bound or affected, except, in the case of clauses (B) and (C),
for any such conflicts, violations, breaches, defaults or other
occurrences which could not, individually or in the aggregate,
reasonably be expected to prevent the consummation of the Offer,
the Transaction or the other transactions contemplated by the
Acquisition Agreement.
(b) Representations and Warranties of the Seller. The
Seller hereby represents and warrants to the Parent and the
Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the Existing
Shares are owned of record or beneficially by the Seller and, on
the date hereof, the Existing Shares constitute all of the shares
of Company Common Stock owned of record or beneficially by the
Seller. The Seller has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with no
restrictions, subject to applicable federal securities laws, on
the Seller's rights of disposition pertaining thereto.
EXHIBIT 99(b)
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(ii) Power; Binding Agreement. The Seller has the legal
capacity, power and authority to enter into and perform all of
its obligations under this Agreement. The execution, delivery
and performance of this Agreement by the Seller and the
consummation by the Seller of the transactions contemplated
hereby have been duly and validly authorized by all necessary
action on the part of the Seller. The execution, delivery and
performance of this Agreement by the Seller will not violate any
other agreement to which the Seller is a party including, without
limitation, any voting agreement, stockholders agreement or
voting trust. This Agreement has been duly executed and
delivered by the Seller and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the Seller
enforceable against the Seller in accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Seller do not and will not:
(A) conflict with or violate any law, rule, regulation, order,
judgment or decree applicable to the Seller or by which the
Seller or its properties or assets are bound or affected; or (B)
result in any breach or violation of or constitute a default (or
an event which with notice or lapse of time or both could become
a default) or result in the loss of a material benefit under, or
give rise to any right of termination, amendment, acceleration
or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties or assets of the Seller
pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument
or obligation to which the Seller is a party or by which the
Seller or any of its properties or assets are bound or affected.
4. Certain Covenants of the Seller. In accordance
with the terms of this Agreement, the Seller hereby covenants and
agrees as follows:
(a) No Solicitation. The Seller shall not, while this
Agreement is in effect, and shall not authorize or permit
any investment banker, financial advisor, attorney, accountant or
other representative retained by him to, solicit, encourage
(including by way of furnishing information), or take any other
action to facilitate, any inquiries or the making of any proposal
which constitutes, or may reasonably be expected to lead to, any
Takeover Proposal, or agree to or endorse any Takeover Proposal.
If the Seller receives or becomes aware of a Takeover Proposal,
then the Seller shall promptly inform the Parent of the terms and
conditions of such proposal and the identity of the person making
it. The Seller will immediately cease and cause to be terminated
any existing activities, discussions or negotiations to which he
is a party with any parties conducted heretofore with respect to
any of the foregoing. Nothing in this Section 4(a) shall restrict
EXHIBIT 99(b)
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or impede any of the Seller's designees on the Company's Board of
Directors from taking any actions which they are permitted to
take under the terms of the Acquisition Agreement in their
capacity as directors.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Seller hereby agrees, while this Agreement is
in effect, and except as contemplated hereby, not to (i) sell,
transfer, pledge, encumber, assign or otherwise dispose of,
enforce or permit the execution of the provisions of any
redemption agreement with the Company or enter into any contract,
option or other arrangement or understanding with respect to, or
consent to the offer for, the sale, transfer, pledge,
encumbrance, assignment or other disposition of, any of the
Existing Shares or any Shares acquired after the date hereof, or
any interest in any of the foregoing, (ii) grant any proxies or
powers of attorney, deposit any Shares into a voting trust or
enter into a voting agreement with respect to any Shares, or
(iii) take any action that would make any representation or
warranty of the Seller contained herein untrue or incorrect or
have the effect of preventing or disabling the Seller from
performing its obligations under this Agreement.
(c) Additional Shares. The Seller hereby agrees,
while this Agreement is in effect, to promptly notify the Parent
of the number of any new shares of Company Common Stock acquired
by the Seller, if any, after the date hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration, each
party hereto shall execute and deliver such additional documents
and take all such further action as may be necessary or desirable
to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Seller shall and hereby
does authorize the Company's counsel to notify the Company's
transfer agent that there is a stop transfer order with respect
to all of the Existing Shares (and that this Agreement places
limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof, and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
EXHIBIT 99(b)
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the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. This Agreement may not be modified,
amended, altered or supplemented, except upon the execution and
delivery of a written agreement executed by the parties hereto.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the Seller:
Warburg, Xxxxxx Investors, L.P.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X.X. Xxxxx
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Press, Esq.
If to the Parent or
the Purchaser:
MCI Communications Corporation
0000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxxxxx, X.X. 00000
Attention: Xxxx X. Xxxxxxxxxxx, Esq.
General Counsel
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, III, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
EXHIBIT 99(b)
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(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision or
portion of any provision of this Agreement will be interpreted in
such manner as to be effective and valid under applicable law but
if any provision or portion of any provision of this Agreement is
held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other
provision or portion of any provision in such jurisdiction, and
this Agreement will be reformed, construed and enforced in such
jurisdiction as if such invalid, illegal or unenforceable
provision or portion of any provision had never been contained
herein.
EXHIBIT 99(b)
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IN WITNESS WHEREOF, the Parent, the Purchaser and the
Seller have caused this Agreement to be duly executed as of the
day and year first above writen.
MCI COMMUNICATIONS CORPORATION
By:/s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: President and Chief
Operating Officer
3183581 CANADA INC.
By:/s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: President
WARBURG, XXXXXX INVESTORS, L.P.
By: WARBURG, XXXXXX & CO.,
General Partner
By:/s/ Xxxxxxx X.X. Xxxxx
Name: Xxxxxxx X.X. Xxxxx
Title: Partner
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY:
SHL SYSTEMHOUSE INC.
By:/s/ J.R. Xxxxxx
Name: J.R. Xxxxxx
Title: Chairman and Chief
Executive Officer
By:/s/ X.X. Xxxxxx
Name: X.X. Xxxxxx
Title: Executive Vice President
and Chief Financial Officer
