AMENDMENT TO PREFERRED STOCK PURCHASE AGREEMENT
THIS AMENDMENT dated October 30, 2000 (this "Amendment") to the
Preferred Stock Purchase Agreement (the "Agreement") dated July 28, 2000 is
entered into by and between OPTICNET, INC., ("OpticNet" or the "Company"), a
Delaware corporation and BEI TECHNOLOGIES, INC. ("BEI Technologies" or the
"Purchaser"), a Delaware corporation. Capitalized terms used but not defined
herein shall have that meaning ascribed to them in the Agreement.
WHEREAS, on July 28, 2000 the Company and the Purchaser entered into
the Agreement whereby the Company agreed to sell to Purchaser and Purchaser
agreed to purchase from the Company 500,000 shares of the Company's Series A
Preferred Stock;
WHEREAS, OpticNet and BEI Technologies have agreed to enter into that
certain Technology Transfer and Distribution Agreement and certain other
agreements related thereto in connection with the distribution of shares of
OpticNet's voting common stock to the stockholders of BEI Technologies; and
WHEREAS, each of the Company and the Purchaser now wish to amend the
Agreement to add new Section 4.11 as set forth below thereto;
NOW, THEREFORE, in consideration of the mutual representations,
warranties and agreements contained herein and intending to be legally bound
hereby, the parties hereto amend the Agreement as follows:
1. Section 4 of the Agreement shall be amended to add new subsection
4.11 thereto which shall read in full as follows:
4.11 Repurchase of Preferred Shares upon Change in Control for
BEI Technologies.
(a) Upon a Change in Control of the Purchaser,
defined as the occurrence of any one of the following events:
(i) any consolidation or merger of Purchaser
with or into any other corporation or other entity or
person, or any other corporate reorganization, in
which the stockholders of the Purchaser immediately
prior to such consolidation, merger, reorganization
or recapitalization, own less than [65]% of the
surviving entity's voting securities immediately
after such consolidation, merger, reorganization or
recapitalization, or any transaction or series of
related transactions resulting in the transfer of
control of in excess of [65]% of the Purchaser's
voting securities; or
(ii) the sale or an agreement by the
Purchaser to sell all or substantially all of its
assets;
1.
then OpticNet shall have the right (the "Repurchase Right"),
but not the obligation, to repurchase all or, at its election,
a portion of, the Preferred Shares from the Purchaser for cash
at the Fair Market Value thereof (a "Repurchase") as of such
date of such Repurchase (the "Repurchase Price"). "Fair Market
Value" shall be determined for the Preferred Shares by valuing
the same as an interest in a continuing business and without
taking into account any discounts or premiums (e.g., lack of
marketability discounts, minority discounts, illiquidity
discounts and control premiums). The Fair Market Value shall
be determined by mutual agreement of the Company and the
Purchaser, or by an investment bank, a nationally recognized
accounting firm or third party appraiser (whose fee shall be
shared equally by the Company and the Purchaser) mutually
agreed upon by the Company and the Purchaser (the "Independent
Appraiser"). In the event the Company and the Purchaser shall
be unable to mutually agree on the Repurchase Price or on an
Independent Appraiser within 30 days following delivery of the
Notice of Exercise of Repurchase Right (as defined below),
each party hereto shall choose an independent party (the
"Independent Designees"), which Independent Designees shall be
charged with selecting and agreeing on an Independent
Appraiser. If such Fair Market Value is to be determined by an
Independent Appraiser, it shall be determined within 30 days
following the appointment (by mutual selection or by the
Independent Designees) of such Independent Appraiser.
(b) Within 30 days following a Change in Control of
Purchaser, Purchaser shall deliver to OpticNet a notice
setting forth the circumstances of such Change in Control (the
"Change in Control Notice"). Following a Change in Control,
OpticNet may notify Purchaser of OpticNet's intent to exercise
its Repurchase Right, as the case may be, by delivering a
notice of the exercise of such Repurchase Right (the "Notice
of Exercise of Repurchase Right") to Purchaser within 60 days
of receipt of the Change in Control Notice. Such Notice of
Exercise of Repurchase Right shall provide the proposed date
for closing the repurchase of the Preferred Shares (the
"Repurchase Date"), which shall be not later than the earlier
of (i) 90 days following the date of such Change in Control of
Purchaser and (ii) 20 days following the final determination
of the Repurchase Price. Purchaser shall be deemed to have
received the Notice of Exercise of Repurchase Right 5 days
after mailing thereof by United States registered mail or upon
delivery in person to the Purchaser at the address for
Purchaser set forth in the Agreement. On the Repurchase Date,
OpticNet shall cause to be delivered to Purchaser the
Repurchase Price by certified check or wire transfer in
immediately available funds against delivery by Purchaser of
the certificate(s) evidencing the Preferred Shares, duly
endorsed for transfer to OpticNet free and clear of all
claims, encumbrances and rights of third parties. Any failure
by Purchaser to deliver the Change in Control Notice to
OpticNet as required herein shall not prejudice OpticNet's
right to exercise the Repurchase Right provided to OpticNet
herein by following such requirements for exercise of such
Repurchase Right as set forth above.
2.
(c) OpticNet may, at its election, freely assign the
Repurchase Right provided herein, to one or more parties in
whole or in part.
(d) From and after the date of any Change in Control
of the Purchaser until the earlier of (i) the Repurchase Date
or (ii) the date 120 days following the date of such Change in
Control, BEI Technologies shall automatically and without
further action be deemed to have granted and hereby grants to
OpticNet an irrevocable proxy to vote the Preferred Shares,
and the shares of the Voting Common Stock of the Company into
which the Preferred Shares are convertible, as applicable,
with full power of substitution therefor, with respect to any
actions which the holder of the Preferred Shares may be
entitled to vote upon under the Delaware General Corporation
Law or the California General Corporation Law, as the case may
be. Such irrevocable proxy is acknowledged by BEI Technologies
to be coupled with an interest.
2. Representations And Warranties of the Company. OpticNet hereby
represents and warrants to the Purchaser as of the date of this Amendment as
follows:
2.1 Incorporation and Good Standing. OpticNet is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware.
2.2 Authorization. All corporate action on the part of
OpticNet necessary for the authorization of this Amendment and the performance
of all obligations of OpticNet hereunder have been taken.
3. Representations And Warranties of the Purchaser. BEI Technologies
hereby represents and warrants to the Company as of the date of this Amendment
as follows:
3.1 Incorporation and Good Standing. BEI Technologies is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware.
3.2 Authorization. All corporate action on the part of BEI
Technologies necessary for the authorization of this Amendment and the
performance of all obligations of BEI Technologies hereunder have been taken.
4. Continuing Effect. Except as expressly amended hereby, the Agreement
shall remain and continue in full force and effect.
4. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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3.
IN WITNESS WHEREOF, the parties have duly executed this Amendment as of
the date first written above.
OPTICNET, INC., a Delaware corporation
By:
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Name:
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Title:
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BEI TECHNOLOGIES, INC., a Delaware corporation
By:
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Name:
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Title:
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