Exhibit 99.2
STOCKHOLDER AGREEMENT
STOCKHOLDER AGREEMENT, dated as of January 8, 2003 (this "Agreement"), by
the undersigned stockholder (the "Stockholder") of Eloquent, Inc., a Delaware
corporation (the "Company"), for the benefit of Open Text Corporation, a
corporation formed under the laws of Ontario ("Parent") and 1220 Acquisition
Corporation, a Delaware corporation ("Acquiror").
RECITALS
WHEREAS, Parent, Acquiror and the Company are entering into the Agreement
and Plan of Merger, dated as of January 8, 2003 (the "Merger Agreement"), which
provides (subject to the conditions set forth therein) for the merger of
Acquiror with and into the Company;
WHEREAS, the Stockholder is the record owner and is the beneficial owner
within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934 (the
"Beneficial Owner") of that number of shares of common stock, par value $.001
per share, of the Company ("Company Common Stock"), appearing on the signature
page hereof (such shares of Company Common Stock, together with any other shares
of capital stock of the Company acquired by such Stockholder after the date
hereof and during the term of this Agreement, being collectively referred to
herein as the "Subject Shares");
WHEREAS, as a condition to its willingness to enter into this Agreement,
Parent and Acquiror have required that the Board of Directors of the Company,
and in order to induce Parent and Acquiror to enter into this Agreement, the
Board of Directors of the Company has approved this Agreement; and
WHEREAS, as a condition to its willingness to enter into the Merger
Agreement, Parent and Acquiror have required that the Stockholder agree, and in
order to induce Parent and Acquiror to enter into the Merger Agreement the
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the promises and the mutual covenants
and agreements set forth herein and subject to the prior approval of this
Agreement by the Board of Directors of the Company, the Stockholder agrees as
follows:
1. Covenants of Stockholder. Until the termination of this Agreement in
accordance with Section 4:
(a) The Stockholder shall attend the Stockholder Meeting, in
person or by proxy, and at the Stockholder Meeting (or at any adjournment
thereof) or in any other circumstances upon which a vote, consent or other
approval with respect to the Merger and the Merger Agreement is sought,
the Stockholder shall vote (or cause to be voted) the Subject Shares in
favor of the Merger, the adoption of the Merger Agreement and the approval
of the terms thereof and each of the other transactions contemplated by
the Merger Agreement.
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(b) At any meeting of stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which the
Stockholder's vote, consent or other approval is sought, the Stockholder
shall vote (or cause to be voted) the Subject Shares against (i) any
merger agreement or merger (other than the Merger Agreement and the
Merger), consolidation, combination, sale of substantial assets,
reorganization, recapitalization, dissolution, liquidation or winding up
of or by the Company or any of its Subsidiaries or any other Takeover
Proposal or (ii) any amendment of the Company's Certificate of
Incorporation, as amended, or Amended and Restated Bylaws or other
proposal or transaction involving the Company or any of its Subsidiaries,
which amendment or other proposal or transaction would in any manner
impede, frustrate, prevent or nullify the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement or
change in any manner the voting rights of any class of capital stock of
the Company. The Stockholder further agrees not to commit or agree to take
any action inconsistent with the foregoing.
(c) The Stockholder agrees not to, directly or indirectly, (i)
sell, transfer, pledge, assign or otherwise dispose of (including by gift)
(collectively, "Transfer"), or enter into any contract, option or other
arrangement (including any profit-sharing arrangement) with respect to the
Transfer of the Subject Shares to any person; (ii) enter into any voting
arrangement, whether by proxy, voting agreement or otherwise, in relation
to the Subject Shares, and agrees not to commit or agree to take any of
the foregoing actions; or (iii) take any action that would reasonably be
expected to make any of its representations or warranties contained herein
untrue or incorrect or have the effect of impairing the ability of such
Stockholder to perform such Stockholder's obligations under this Agreement
or preventing or delaying the consummation of any of the transactions
contemplated hereby. Notwithstanding the foregoing, this Agreement shall
not prohibit a Transfer of Company Common Stock by Stockholder (i) to any
member of his immediate family, or to a trust for the benefit of
Stockholder or any member of his immediate family; (ii) on the death of
Stockholder; or (iii) if Stockholder is a partnership or limited liability
company, to one or more partners or members of Stockholder or to an
affiliated corporation under common control with Stockholder; provided,
however, that a Transfer referred to in this sentence shall be permitted
only if, as a precondition to such Transfer, the transferee agrees in a
writing, reasonably satisfactory in form and substance to Parent and
Acquiror, to be bound by the terms of this Agreement.
(d) The Stockholder shall not, nor shall the Stockholder authorize
any investment banker, attorney or other advisor or representative of the
Stockholder to, (i) directly or indirectly solicit, initiate or encourage
the submission of, any Takeover Proposal or (ii) directly or indirectly
participate in any discussions or negotiations regarding, or furnish to
any person any information with respect to the Company or any Subsidiary
in connection with, or take any other action to facilitate any inquiries
or the making of any proposal that constitutes or may reasonably be
expected to lead to, any Takeover Proposal.
(e) The Stockholder shall use its reasonable best efforts to take,
or cause to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with Acquiror in doing, all things reasonably
necessary, proper or advisable to support and to consummate
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and make effective, in the most expeditious manner practicable, the Merger
and the other transactions contemplated by the Merger Agreement.
(f) In the event (i) of any stock dividend, stock split,
recapitalization, reclassification, combination or exchange of shares of
capital stock or other securities of the Company on, of or affecting the
Shares or the like or any other action that would have the effect of
changing a Stockholder's ownership of the Company's capital stock or other
securities or (ii) a Stockholder becomes the beneficial owner of any
additional Shares or other securities of the Company, then the terms of
this Agreement will apply to the shares of capital stock held by the
Stockholder immediately following the effectiveness of the events
described in clause (i) or the Stockholder becoming the beneficial owner
thereof, as described in clause (ii), as though they were Subject Shares
hereunder.
(g) The Stockholder agrees to promptly notify Acquiror in writing
of the nature and amount of any acquisition, or any other transaction
which has the effect of increasing the number of shares held directly or
beneficially by such Stockholder, of any voting securities of the Company
acquired by such Stockholder after the date hereof.
2. Irrevocable Proxy.
(a) Grant of Proxy. Stockholder hereby appoints Acquiror and any
designee of Acquiror, each of them individually, Stockholder's proxy and
attorney-in-fact, with full power of substitution and resubstitution, to
vote or act by written consent with respect to all of the Subject Shares
which it has the right to vote (i) in accordance with Section 1 hereof and
(ii) to sign its name (as a stockholder) to any consent, certificate or
other document relating to the Company that the law of the State of
Delaware may permit or require in connection with any matter referred to
in Section 1. This proxy is given to secure the performance of the duties
of Stockholder under this Agreement and its existence will not be deemed
to relieve Stockholder of its obligations under Section 1. Stockholder
affirms that this proxy is coupled with an interest and is irrevocable (to
the fullest extent permitted by law) until termination of this Agreement
pursuant to Section 4, whereupon such proxy and power of attorney shall
automatically terminate. Stockholder will take such further action or
execute such other instruments as may be reasonably necessary to
effectuate the intent of this proxy. For Subject Shares as to which
Stockholder is the beneficial but not the record owner, Stockholder will
use reasonable best efforts to cause any record owner of such Subject
Shares to grant to Acquiror a proxy to the same effect as that contained
herein.
(b) Other Proxies Revoked. Stockholder represents that any proxy
heretofore given in respect of the Subject Shares is not irrevocable, and
hereby revokes any and all such proxies.
3. Representations and Warranties. The Stockholder represents and
warrants to Acquiror as follows:
(a) As of the date of this Agreement: (a) the Stockholder is the
record owner of, and has good and marketable title to, the number of
Subject Shares set forth under the heading "Subject Shares Held of Record"
on the signature page hereof; and (b) Stockholder
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is the Beneficial Owner of the number of Subject Shares set forth under
the heading "Additional Subject Shares Beneficially Owned" on the
signature page hereof. The Stockholder does not own, of record or
beneficially, any shares of capital stock of the Company other than the
Subject Shares. The Stockholder has the sole right to vote, and the sole
power of disposition, with respect to the Subject Shares set forth under
the heading "Subject Shares Held of Record." None of the Subject Shares is
subject to any voting trust, proxy or other agreement, arrangement or
restriction with respect to the voting or disposition of such Subject
Shares, except as contemplated by this Agreement.
(b) This Agreement has been duly executed and delivered by the
Stockholder. Assuming the due authorization, execution and delivery of
this Agreement by Acquiror, this Agreement constitutes the valid and
binding agreement of the Stockholder enforceable against the Stockholder
in accordance with its terms, subject to (i) laws of general application
relating to bankruptcy, insolvency and the relief of debtors, and (ii)
rules of laws governing specific performance, injunctive relief and other
equitable relief. The execution and delivery of this Agreement by the
Stockholder does not and will not conflict with any agreement, order or
other instrument binding upon the Stockholder, nor require any regulatory
filing or approval.
(c) The execution and delivery of this Agreement do not, and,
subject to compliance with the HSR Act and appropriate filings under
securities laws (which each Stockholder agrees to make promptly), to the
extent applicable, the consummation of the transactions contemplated
hereby and compliance with the provisions hereof will not, conflict with,
result in a violation or breach of, or constitute a default (or an event
that, with notice or lapse of time or both, would result in a default) or
give rise to any right of termination, amendment, cancellation, notice or
acceleration under, (i) the Stockholder's certificate of incorporation,
certificate of limited partnership, articles of organization, operating
agreement, partnership agreement or similar constituent documents, (ii)
any material contract, commitment, agreement, understanding, arrangement
or restriction of any kind to which the Stockholder is a party or by which
the Stockholder is bound, (iii) any injunction judgment, writ, decree,
order or ruling applicable to the Stockholder or (iv) any law, statute,
rule or regulation applicable to the Stockholder; except in the case of
clauses (ii) and (iii) for violations, breaches or defaults that would not
(1) impair the ability of the Stockholder to perform its obligations under
this Agreement or (2) prevent or delay the consummation of any of the
transactions contemplated hereby.
(d) Except as set forth in Section 3.28 of the Merger Agreement,
no broker, finder or investment banker is entitled to any brokerage,
finder's or other fee or commission in connection with the transactions
contemplated by this Agreement or the Merger Agreement based upon
arrangements made by or on behalf of the Stockholder that is or will be
payable by the Company or any of its Subsidiaries.
4. Termination. The obligations of the Stockholder hereunder shall
terminate on the earlier to occur of (i) the termination of the Merger Agreement
pursuant to Section 7.1 thereof and (ii) the Effective Time. Notwithstanding
anything to the contrary contained in this Agreement, if this Agreement is
terminated for any reason, Sections 7, 8, 9, 10, 11 and 12 and this Section 4
will survive any termination of this Agreement indefinitely.
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5. Further Assurances. The Stockholder will, from time to time, execute
and deliver, or cause to be executed and delivered, such additional or further
consents, documents and other instruments as Acquiror may reasonably request for
the purpose of effectively carrying out the transactions contemplated by this
Agreement.
6. Successors, Assigns and Transferees Bound. Any successor, assignee
or transferee (including a successor, assignee or transferee as a result of the
death of the Stockholder, such as an executor or heir) shall be bound by the
terms hereof, and the Stockholder shall take any and all actions necessary to
obtain the written confirmation from such successor, assignee or transferee that
it is bound by the terms hereof.
7. Remedies. The Stockholder acknowledges that money damages would be
both incalculable and an insufficient remedy for any breach of this Agreement by
it, and that any such breach would cause Acquiror irreparable harm. Accordingly,
the Stockholder agrees that in the event of any breach or threatened breach of
this Agreement, Acquiror, in addition to any other remedies at law or in equity
it may have, shall be entitled, without the requirement of posting a bond or
other security, to equitable relief, including injunctive relief and specific
performance.
8. Severability. The invalidity or unenforceability of any provision of
this Agreement in any jurisdiction shall not affect the validity or
enforceability of any other provision of this Agreement in such jurisdiction, or
the validity or enforceability of any provision of this Agreement in any other
jurisdiction.
9. Amendment. This Agreement may be amended only by means of a written
instrument executed and delivered by both the Stockholder and Acquiror.
10. Jurisdiction. Each party hereby irrevocably submits to the exclusive
jurisdiction of the United States District Court for the Northern District of
California or the California state courts located in the City and County of San
Francisco in any action, suit or proceeding arising in connection with this
Agreement, and agrees that any such action, suit or proceeding shall be brought
only in such courts (and waives any objection based on forum non conveniens or
any other objection to venue therein). Each party hereto waives any right to a
trial by jury in connection with any such action, suit or proceeding.
11. 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.
12. Notice. All notices, requests, demands and other communications
hereunder shall be deemed to have been duly given and made if in writing and if
served by personal delivery upon the party for whom it is intended or if sent by
telex or telecopier (and also confirmed in writing) to the person at the address
set forth below, or such other address as may be designated in writing
hereafter, in the same manner, by such person:
(a) if to Parent or Acquiror, to:
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1220 Acquisition Corporation
Attention: General Counsel
Facsimile No.: (000) 000-0000
with copies to:
Xxxxxxx Xxxxx + Xxxxxx LLP
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Facsimile No.: 000-000-0000
(b) if to the Stockholder to:
ONSET Enterprise Associates II, L.P.
ONSET Ventures
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxx
Facsimile No.: (000) 000-0000
13. Capitalized Terms. Capitalized terms used in this Agreement that are
not defined herein shall have such meanings as set forth in the Merger
Agreement.
14. Counterparts. For the convenience of the parties, this Agreement may
be executed in counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
15. No Limitation on Actions of the Stockholder as Director.
Notwithstanding anything to the contrary in this Agreement, nothing in this
Agreement is intended or shall be construed to require the Stockholder to take
or in any way limit any action that the Stockholder may take to discharge the
Stockholder's fiduciary duties as a director of the Company, including but not
limited to the right to vote for or support a Superior Proposal in accordance
with the terms of the Merger Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
/s/ Xxxxx X. Xxxxxxxx
------------------------------------
ONSET ENTERPRISE ASSOCIATES II, L.P.
Name: Xxxxx X. Xxxxxxxx
Title: General Partner,
OEA II Management, L.P.
The General Partner of
ONSET Enterprise Associates II, L.P.
NUMBER OF SUBJECT ADDITIONAL SUBJECT
SHARES HELD OF RECORD SHARES BENEFICIALLY OWNED
--------------------- -------------------------
1,668,103 0
OPEN TEXT CORPORATION
By: /s/ Xxxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Secretary
1220 ACQUISITION CORPORATION
By: /s/ Xxxxxxx Xxxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Secretary
Approved For Purposes of Section 203 of the Delaware
General Corporation Law:
ELOQUENT, INC.
By: /s/ Xxxxxxxx X. Xxxx
----------------------------
Name: Xxxxxxxx X. Xxxx
Title: Chairman
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