Exhibit 2.2
STOCKHOLDER SUPPORT AGREEMENT
THIS STOCKHOLDER SUPPORT AGREEMENT, dated as of January 5, 2003 (this
"AGREEMENT"), by and between Automatic Data Processing, Inc., a Delaware
corporation ("PARENT") and the stockholders of the Company listed on the
signature page hereto (collectively, the "Stockholders"). Capitalized terms used
and not otherwise defined herein shall have the respective meanings assigned to
them in the Merger Agreement referred to below.
WHEREAS, concurrently with the execution of this Agreement, ProBusiness
Services, Inc., a Delaware corporation (the "COMPANY"), Parent and ADP Merger
Corp., a Delaware corporation and an indirect wholly owned subsidiary of Parent
("Merger Sub") have entered into an Agreement and Plan of Merger, as it may be
amended from time to time (the "Merger Agreement"), pursuant to which, upon the
terms and subject to the conditions thereof, Merger Sub will be merged with and
into the Company, and the Company will continue as the surviving corporation
(the "Merger"); and
WHEREAS, as a condition to the willingness of Parent to enter into the
Merger Agreement, Parent has required that the Stockholders agree, and in order
to induce Parent to enter into the Merger Agreement, the Stockholders are
willing, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements contained herein, and intending to be legally bound hereby, the
parties hereby agree, severally and not jointly, as follows:
Section 1. Definitions. For purposes of this Agreement:
(a) "Company Common Stock" shall mean the shares of common stock,
par value $0.001 per share, of the Company.
(b) "Company Capital Stock" shall mean the shares of capital stock
of the Company, including, without limitation, the Company Common Stock and the
Company Preferred Stock.
(c) "Company Preferred Stock" shall mean the shares of 6.9% Senior
Convertible Preferred Stock, par value 0.001 per share, of the Company.
(d) "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
(e) "Expiration Date" shall mean the earlier to occur of (i) the
date upon which the Merger Agreement is validly terminated in accordance with
its terms, (ii) the Effective Time or (iii) the date upon which the Merger
Agreement is amended to reduce either the Per Share Amount or the Preferred Per
Share Liquidation Amount, if the Stockholder (or its designee to the board of
directors) in his or its designee's capacity as a director of the Company did
not vote in favor of or consent to such amendment.
(f) Each Stockholder shall be deemed to "Own" or to have acquired
"Ownership" of a security if such Stockholder: (i) is the record owner of such
security; or (ii) is the "beneficial owner" (within the meaning of Rule 13d-3
under the Exchange Act) of such security. Without duplicative counting of the
same securities by the same holder, securities Owned by a holder shall include
securities Owned by all other Persons with whom such Person would constitute a
"group" within the meaning of Section 13(d) of the Exchange Act other than
parties to this Agreement.
(g) "Subject Securities" shall mean: (i) the Existing Securities
(as defined in Section 5(a) below); (ii) any shares of Company Capital Stock
distributed prior to the termination of this Agreement in respect of Subject
Securities by reason of a stock dividend, stock-split, recapitalization,
reclassification, combination, merger, exchange of shares or otherwise; and
(iii) all additional securities of Company (including all additional shares of
Company Capital Stock and all additional options, warrants and other rights to
acquire shares of Company Capital Stock) of which the Stockholder acquires
Ownership during the period from the date of this Agreement through the
Expiration Date.
(h) A Person shall be deemed to have effected a "Transfer" of a
security if such Person directly or indirectly: (i) sells, tenders, pledges,
encumbers, grants an option with respect to, transfers or disposes of Ownership
of such security or any interest in such security; or (ii) enters into an
agreement or commitment contemplating the possible sale of, tender of, pledge
of, encumbrance of, grant of an option with respect to, transfer of or
disposition of Ownership of such security or any interest therein.
Section 2. Voting of Shares.
(a) During the period from the date of this Agreement through the
Expiration Date, each Stockholder covenants and agrees that, at any meeting of
the stockholders of the Company, however called, and regardless of whether such
meeting is a special or annual meeting of stockholders of the Company, or at any
adjournment thereof, or in connection with any action by written consent by the
stockholders of the Company, such Stockholder will vote, or cause to be voted,
all Subject Securities
(i) in favor of the approval of the Merger and the adoption
of the Merger Agreement and the transactions contemplated by the Merger
Agreement; and
(ii) against any Acquisition Proposal with respect to the
Company.
Section 3. Grant of Proxy; Revocation of Proxies; Reliance.
(a) Each Stockholder hereby irrevocably grants to and appoints
Xxxxx X. Xxxxxx and Xxxx Xxxxxx or either of them in their respective capacities
as officers of Parent, with full power of substitution (such individuals and
their substitutes each being referred to herein as the "Proxy"), as attorneys
and proxies to vote all Subject Securities in favor of the matters referred to
in clauses (i) and (ii) of Section 2 above. Each Stockholder agrees that the
Proxy may, in such Stockholder's name and stead, (i) attend any annual or
special meeting of stockholders of the Company (including any and all
adjournments and postponements thereof) and vote all Subject Securities in favor
of the matters referred to in clauses (i) and (ii) of Section 2 above at
any such annual or special meeting (including any and all adjournments and
postponements thereof), and (ii) execute with respect to all Subject Securities
any written consent with respect to matters referred to in clauses (i) and (ii)
of Section 2 above. Each Stockholder agrees that, prior to the Expiration Date,
this grant of proxy pursuant to this Section 3(a) is irrevocable and coupled
with an interest and agrees that the Persons designated as the Proxy pursuant
hereto may at any time name any other person who is an officer of Parent as a
substitute Proxy hereunder to act pursuant hereto, either as to a specific
matter or as to all matters.
(b) Each Stockholder hereby represents that any proxies heretofore
given in respect of the Subject Securities that are inconsistent with the proxy
granted pursuant to Section 3(a) above are not irrevocable, and that any such
proxies are hereby revoked.
(c) Each Stockholder understands and acknowledges that Parent and
Merger Sub have entered into the Merger Agreement in reliance upon such
Stockholder's execution and delivery of this Agreement.
Section 4. Transfer of Subject Securities. Each Stockholder hereby agrees
and covenants that, during the period from the date of this Agreement through
the Expiration Date:
(a) Restriction on Transfers. Except as may otherwise be agreed to
by Parent in writing, such Stockholder shall not Transfer or consent to any
Transfer of Ownership of any or all of the Subject Securities, or any interest
therein if such Transfer would result in such Stockholder no longer having the
power to vote, or cause to be voted, the Subject Securities in accordance with
the terms of this Agreement; provided, however, a Stockholder may Transfer
Subject Securities to any Person so long as such Person shall have (i) executed
a counterpart of this Agreement and (ii) agreed to hold such Subject Securities
subject to the terms and provisions of this Agreement to the same extent as such
Stockholder. Notwithstanding anything contained herein to the contrary:
(i) a Stockholder may Transfer any of the Subject
Securities that have been pledged pursuant to the forward contracts established
prior to the date of this Agreement set forth in Schedule I;
(ii) if a Stockholder is also a director of the Company,
such Stockholder may Transfer the Subject Securities in accordance with the
terms of such Stockholder's trading plan established for the periodic sale of
Company Common Stock implemented pursuant to the Securities and Exchange
Commission Rule 10b5-1(c) in effect as of the date hereof; and
(iii) if a Stockholder is also a director of the Company,
such Stockholder may Transfer any of the Subject Securities that have been
pledged by such Stockholder pursuant to the terms of the margin loan accounts
established prior to the date of this Agreement set forth in Schedule I.
(b) Restrictions on Proxies and Voting Arrangements. Except as
otherwise provided herein, such Stockholder shall not (i) grant any proxy,
power-of-attorney or other authorization in or with respect to the Subject
Securities that is inconsistent with the proxy granted pursuant to Section 3(a)
above or (ii) deposit any of the Subject Securities into a voting
trust or enter into a voting agreement or arrangement with respect to any of the
Subject Securities that would impair such Stockholder's ability to comply with
its obligations pursuant to this Agreement.
(c) Stop Transfer. Such Stockholder shall not request that the
Company register any Transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Stockholder's Existing
Securities, unless such Transfer is made in compliance with this Agreement.
(d) Waiver of Appraisal Rights. Each Stockholder hereby irrevocably
and unconditionally waives, and agrees to prevent the exercise of, any rights of
appraisal or rights to dissent in connection with the Merger (or other business
combination pursuant to the Merger Agreement) that such Stockholder may have
with respect to the Subject Securities.
Section 5. Representations and Warranties of the Stockholders. Each
Stockholder hereby represents and warrants to Parent as follows:
(a) Ownership of Securities. On the date hereof, such Stockholder
beneficially Owns, or has the sole power to direct the voting of, the Company
Capital Stock set forth next to such Stockholder's name on Schedule I hereto
(the "Existing Securities"). On the date hereof, the Existing Securities
constitute all of the shares of voting capital stock of the Company beneficially
Owned by such Stockholder or as to which such Stockholder has the sole power to
direct the voting of the shares.
(b) Power; Binding Agreement. Such Stockholder has the power (or,
if applicable, corporate power) and authority to enter into and perform all of
such Stockholder's obligations hereunder, including, without limitation, the
power and authority to vote the Subject Securities in accordance with Section 2
hereof and to grant the proxy in accordance with Section 3 hereof. This
Agreement has been duly and validly executed and delivered by such Stockholder
and constitutes a valid and binding agreement of such Stockholder, enforceable
against the Stockholder in accordance with its terms, except that (A) such
enforcement may be subject to applicable bankruptcy, insolvency, moratorium, or
other similar laws, now or hereafter in effect, affecting creditors' rights
generally and (B) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
(c) No Conflicts.
i) The execution and delivery of this Agreement and the Proxy
by such Stockholder do not, and the performance of this Agreement and the Proxy
by such Stockholder will not: (A) conflict with or violate any law, rule,
regulation, order, decree or judgment applicable to such Stockholder or by which
such Stockholder or any of such Stockholder's properties is or may be bound or
affected, or (B) result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (with or
without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any encumbrance or restriction on any of the Subject
Securities pursuant to, any Contract to which
such Stockholder is a party or by which such Stockholder or any of such
Stockholder's affiliates or properties is or may be bound or affected.
(ii) The execution and delivery of this Agreement by such
Stockholder does not, and the performance of this Agreement by such Stockholder
shall not, require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental entity except for applicable
requirements, if any, of the Exchange Act, and except where the failure to
obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, would not prevent or delay the performance by such
Stockholder of his or its obligations under this Agreement.
(d) No Encumbrances. Except:
(i) as established hereby;
(ii) for Existing Securities subject to a pledge agreement in
effect prior to the date of this Agreement and set forth in Schedule I;
(iii) for Existing Securities subject to forward purchase
Contracts in effect prior to the date of this Agreement and set forth in
Schedule I; or
(iv) if a Stockholder is also a director of the Company, for
Existing Securities that have been pledged by such Stockholder pursuant to a
margin loan account prior to the date of this Agreement as set forth on Schedule
I, the Existing Securities are now and, at all times during the term hereof,
will be held by the Stockholder, or by a nominee or custodian for the benefit of
such Stockholder, free and clear of all securities interests, liens, power of
attorney, pledges, options, proxies, voting trusts, agreements, understandings
or arrangements whatsoever, in each case, that could reasonably be expected to
materially hinder or impede such Stockholder's ability to perform its
obligations hereunder.
Section 6. Termination. This Agreement and the covenants, representations,
warranties, and agreements contained herein shall terminate upon the Expiration
Date. Upon any termination of this Agreement, this Agreement shall thereupon
become void and of no further force and effect, and there shall be no liability
in respect of this Agreement or of any transactions contemplated hereby or by
the Merger Agreement on the part of any party hereto or any of its directors,
officers, partners, stockholders, employees, agents, advisors, representatives
or affiliates; provided, however, that nothing contained herein shall relieve
any party from any liability for such party's breach of this Agreement prior to
termination.
Section 7. Election and Waiver. If a Stockholder Owns shares of Company
Preferred Stock, such Stockholder agrees that subject to and effective upon the
Closing, such Stockholder hereby irrevocably and unconditionally: (A) elects
under Section 4(d) of the Certificate of Designation for the Company Preferred
Stock (the "CERTIFICATE OF DESIGNATION") to treat the Merger as a deemed
Liquidation (as defined in the Certificate of Designation) pursuant to Section 4
thereof; and (B) waives the right to receive notice of the Merger pursuant to
Section 8(g) and Section 8(h) of the Certificate of Designation.
Section 8. Miscellaneous.
(a) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by facsimile (with a confirmatory copy sent by overnight courier), by
overnight courier service or by registered or certified mail (postage prepaid,
return receipt requested) to the respective parties at the following addresses
(or at such other address for a party as shall be specified in a notice given in
accordance with this Section 8(a)):
if to Parent:
Automatic Data Processing, Inc.
Xxx XXX Xxxxxxxxx
Xxxxxxxx, XX 00000-0000
Attention: President, Employer Services Group
Facsimile: (000) 000-0000
with a copy to:
Automatic Data Processing, Inc.
Xxx XXX Xxxxxxxxx
Xxxxxxxx, XX 00000-0000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
if to Stockholder, as stated on Schedule I hereto.
(b) Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in a mutually
acceptable manner in order that the Merger be consummated as originally
contemplated to the fullest extent possible.
(c) Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements
and undertakings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof.
(d) Assignment. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, provided that, except as provided herein, no party may
assign, delegate or otherwise transfer any of its rights or obligations
hereunder, in whole or in part, by operation of law or otherwise by any of the
parties, without the consent of the other parties hereto.
(e) Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing herein,
express or implied, is intended to or shall confer upon any other Person any
right, benefit or remedy of any nature whatsoever under or by reason of this
Agreement.
(f) Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or equity.
(g) 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
law) as to all matters, including, but not limited to, matters of validity,
construction, effect, performance and remedies.
(h) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE ACTIONS OF PARENT OR THE COMPANY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.
(i) Further Assurances. From time to time prior to the
Expiration Date, at the request of Parent, such Stockholder shall execute and
deliver to Parent, or cause the record holder of Subject Securities to execute
and deliver to Parent, such additional letters or instruments to comply with
applicable law and stock exchange rules as Parent may reasonably request in
connection with such Stockholder's obligations under this Agreement.
(j) Descriptive Headings; Interpretation. The descriptive
headings 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.
(k) Amendment, Modification and Waiver. This Agreement may not
be amended, modified or waived except by an instrument or instruments in writing
signed and delivered on behalf of the party hereto against whom such amendment,
modification or waiver is sought to be entered.
(l) Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
and delivered shall be deemed to be an original but all of which taken together
shall constitute one and the same agreement.
(m) No Limitation on Actions of Stockholder as Director.
Notwithstanding anything to the contrary contained in this Agreement, in the
event that a Stockholder or any of its designees is a director or officer of the
Company, nothing in this Agreement is intended or shall be construed to require
such Stockholder (or any of its designees), in such Stockholder's (or any such
designee's) capacity as a director or officer of the Company, to fail to act in
accordance with such Stockholder's (or any such designee's) fiduciary duties in
such capacity.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be signed individually or by its respective duly authorized officer as of the
date first written above.
PARENT
By:
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Name:
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Title:
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STOCKHOLDER:
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Signature
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Name
SCHEDULE I
STOCKHOLDER NUMBER OF NUMBER OF SHARES OF NUMBER OF EXISTING
SHARES OF COMPANY SECURITIES
COMPANY PREFERRED STOCK TRANSFERRED
COMMON OWNED OF RECORD PURSUANT TO 10B5-1
STOCK OWNED (EXCLUDING ANY TRADING PLAN;
OF RECORD ACCRUED BUT UNPAID PLEDGED PURSUANT TO
DIVIDENDS PAYABLE IN MARGIN LOAN OR
SHARES OF PREFERRED OTHERWISE; AND
STOCK) SUBJECT TO FORWARD
CONTRACTS
