CONFORMED COPY
STOCKHOLDER AGREEMENT dated as of October 29,
2001 (this "Agreement"), between INTERNATIONAL BUSINESS
MACHINES CORPORATION, a New York corporation
("Parent") and each of THE INDIVIDUALS AND OTHER
PARTIES LISTED ON SCHEDULE A ATTACHED HERETO (each, a
"Stockholder" and, collectively, the "Stockholders").
WHEREAS Parent, Duke Acquisition Corp., a Delaware corporation and a
wholly owned subsidiary of Parent ("Sub"), and CrossWorlds Software Inc., a
Delaware corporation (the "Company"), have contemporaneously with the
execution of this Agreement entered into an Agreement and Plan of Merger dated
as of the date hereof (as the same may be amended or supplemented, the "Merger
Agreement"; terms used but not defined herein shall have the meanings set
forth in the Merger Agreement) providing for the merger of Sub with and into
the Company (the "Merger") upon the terms and subject to the conditions set
forth in the Merger Agreement;
WHEREAS each Stockholder owns (of record or beneficially) the number
of shares of capital stock of the Company set forth opposite such
Stockholder's name on Schedule A hereto (such shares of capital stock of the
Company being referred to herein as such Stockholder's "Subject Shares"); and
WHEREAS as a condition to its willingness to enter into the Merger
Agreement, Parent has required that each Stockholder enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements set forth herein and in
the Merger Agreement, each party hereto agrees as follows:
SECTION 1. Representations and Warranties of Each Stockholder. Each
Stockholder hereby, severally and not jointly, only as to itself, represents
and warrants to Parent as follows:
(a) Organization; Authority; Execution and Delivery; Enforceability.
With respect to each Stockholder that is not a natural person, such
Stockholder (i) is duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization and (ii) has all requisite
corporate or other power and authority to execute and deliver this Agreement,
to consummate the transactions contemplated hereby and to comply with the
terms hereof. The execution and delivery of this Agreement by such
Stockholder, the consummation by such Stockholder of the transactions
contemplated hereby and the compliance by such Stockholder with the terms
hereof have been duly authorized by all necessary corporate or other action on
the part of such Stockholder and no other corporate or other proceedings on
the part of such Stockholder are necessary to authorize this Agreement or to
consummate the transactions contemplated by this Agreement. This Agreement has
been duly executed and delivered by such Stockholder and, assuming due
execution by Parent, constitutes a valid and binding obligation of
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such Stockholder, enforceable against such Stockholder in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws. The execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby
and compliance with the provisions hereof do not and will not conflict with,
or result in any violation or breach of, or default (with or without notice or
lapse of time, or both) under, or give rise to a right of, or result in
termination, cancelation or acceleration of any obligation or to loss of a
material benefit under, or result in the creation of any Lien in or upon any
of the properties or assets of such Stockholder under, or give rise to any
increased, additional, accelerated or guaranteed rights or entitlements under,
any provision of (i) any certificate of incorporation or by-laws, partnership
agreement or limited liability company agreement (or similar organizational
documents) of such Stockholder, (ii) any Contract to which such Stockholder is
a party or any of the properties or assets of such Stockholder is subject or
(iii) subject to the governmental filings and other matters referred to in the
following sentence, any (A) statute, law, ordinance, rule or regulation or (B)
judgment, order or decree, in each case, applicable to such Stockholder or its
properties or assets. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is required
by or with respect to such Stockholder in connection with the execution and
delivery of this Agreement by such Stockholder or the consummation by such
Stockholder of the transactions contemplated by this Agreement or the
compliance by such Stockholder with the provisions of this Agreement, except
for (1) filings under the HSR Act and any other applicable competition, merger
control, antitrust or similar law or regulation, (2) filings with the SEC of
such reports under the Exchange Act as may be required in connection with this
Agreement and the transactions contemplated hereby.
(b) The Subject Shares. Such Stockholder is the record and
beneficial owner of the Subject Shares of such Stockholder set forth opposite
his or her or its name on Schedule A hereto, and if such Stockholder is a
record owner of Subject Shares such Stockholder has good and marketable title
to such Subject Shares, free and clear of any Liens. Such Stockholder does not
own of record any shares of capital stock of the Company other than the
Subject Shares as set forth opposite his or her or its name on Schedule A
hereto. Such Stockholder has the sole right to vote and Transfer (as defined
in Section 3(c)) the Subject Shares owned (of record or beneficially) by such
Stockholder, and none of the Subject Shares owned (of record or beneficially)
by such Stockholder is subject to any voting trust or other agreement,
arrangement or restriction with respect to the voting or the Transfer of the
Subject Shares, except as set forth in Sections 3 and 4 of this Agreement.
(c) Private Offering. Such Stockholder has not, nor has any
affiliate of such Stockholder nor has anyone acting on behalf of such
Stockholder issued, sold or offered any security of the Company to any person
under circumstances that would cause the sale, if any, of the Subject Shares
of any Stockholder to Parent (or its designee or assignee) as contemplated by
Section 3(h) of this Agreement, to be subject to the registration requirements
of the Securities Act. Assuming the representations of Parent contained in the
last sentence of Section 2 are true
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and correct, the sale and delivery, if any, of the Subject Shares of such
Stockholder hereunder are exempt from the registration and prospectus delivery
requirements of the Securities Act.
SECTION 2. Representations and Warranties of Parent. Parent hereby
represents and warrants to each Stockholder as follows: Parent has all
requisite corporate power and authority to execute and deliver this Agreement,
to consummate the transactions contemplated hereby and to comply with the
terms hereof. The execution and delivery of this Agreement by Parent,
consummation by Parent of the transactions contemplated hereby and compliance
by Parent with the terms hereof have been duly authorized by all necessary
corporate action on the part of Parent and no other corporate proceedings on
the part of Parent are necessary to authorize this Agreement or to consummate
the transactions contemplated hereby. This Agreement has been duly executed
and delivered by Parent and, assuming due execution by each Stockholder,
constitutes a valid and binding obligation of Parent, enforceable against
Parent in accordance with its terms. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby do not
and will not conflict with, or result in any violation or breach of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of, or result in termination, cancelation or acceleration of any
obligation or to loss of a material benefit under, or result in the creation
of any Lien upon any of the properties or assets of Parent under, or give rise
to any increased, additional, accelerated or guaranteed rights or entitlements
under, any provision of (i) the Certificate of Incorporation or By-laws of
Parent, (ii) any Contract applicable to Parent or its properties or assets or
(iii) subject to the governmental filings and other matters referred to in the
following sentence, any (A) statute, law, ordinance, rule or regulation or (B)
judgment, order or decree, in each case, applicable to Parent or its
properties or assets. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is required
by or with respect to Parent in connection with the execution and delivery of
this Agreement by Parent or the consummation by Parent of the transactions
contemplated hereby, except for (1) filings under the HSR Act and any other
applicable competition, merger control, antitrust or similar law or regulation
and (2) filings with the SEC of such reports under the Exchange Act as may be
required in connection with this Agreement and the transactions contemplated
hereby. Any Subject Shares purchased by Parent pursuant to this Agreement will
be acquired for investment only and not with a view to any public distribution
thereof, and Parent shall not offer to sell or otherwise dispose of any
Subject Shares so acquired by it in violation of any of the registration
requirements of the Securities Act.
SECTION 3. Covenants of Each Stockholder. Each Stockholder,
severally and not jointly, only as to itself, covenants and agrees as follows:
(a) At any meeting of the stockholders of the Company called to vote
upon the Merger Agreement, the Merger or any of the other transactions
contemplated by the Merger Agreement, or at any adjournment thereof, or in any
other circumstances upon which a vote, consent, adoption or other approval
(including by written consent solicitation) with respect to the Merger
Agreement, the Merger or any of the other transactions contemplated by the
Merger Agreement is sought, such Stockholder shall vote (or cause to be voted)
all the Subject Shares of
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such Stockholder (owned of record or beneficially) in favor of, and shall
consent to (or cause to be consented to), the adoption of the Merger Agreement
and the approval of the terms thereof and of the Merger and each of the other
transactions contemplated by the Merger Agreement.
(b) At any meeting of the stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which a vote, consent,
adoption or other approval (including by written consent solicitation) is
sought, such Stockholder shall vote (or cause to be voted) all the Subject
Shares of such Stockholder (owned of record or beneficially) against, and
shall not consent to (and shall cause not to be consented to), any of the
following (or any agreement to enter into, effect, facilitate or support any
of the following): (i) any Takeover Proposal or (ii) any amendment of the
Company's Amended and Restated Certificate of Incorporation or Amended and
Restated By-laws or other proposal, action or transaction involving the
Company or any of its subsidiaries or any of its stockholders, which amendment
or other proposal, action or transaction could reasonably be expected to
prevent or materially impede or delay the consummation of the Merger or the
other transactions contemplated by the Merger Agreement or the consummation of
the transactions contemplated by this Agreement or to dilute in any material
respect the benefits to Parent of the Merger and the other transactions
contemplated by the Merger Agreement or the transactions contemplated by this
Agreement, or change in any manner the voting rights of the Company Common
Stock (collectively, "Frustrating Transactions").
(c) Such Stockholder shall not (i) prior to the Stockholders
Meeting, sell, transfer, pledge, assign, tender or otherwise dispose of
(including by gift) (collectively, "Transfer"), or consent to or permit any
Transfer of, any Subject Shares or any interest therein, or enter into any
Contract, option or other arrangement with respect to the Transfer (including
any profit sharing or other derivative arrangement) of any Subject Shares or
any interest therein, to any person other than pursuant to this Agreement or
the Merger Agreement, unless prior to any such Transfer the transferee of such
Subject Shares enters into a stockholder agreement with Parent on terms
substantially identical to the terms of this Agreement or (ii) enter into any
voting arrangement, whether by proxy, voting agreement or otherwise, in
connection with, directly or indirectly, any Takeover Proposal or Frustrating
Transaction with respect to any Subject Shares, other than pursuant to this
Agreement.
(d) Such Stockholder shall not, nor shall such Stockholder permit
any of its subsidiaries to, or authorize or permit any director, officer,
employee or partner of such Stockholder or any of its subsidiaries, or any
investment banker, attorney or other advisor or representative of such
Stockholder or any of its subsidiaries to, directly or indirectly, (i)
solicit, initiate or encourage, or take any other action knowingly to
facilitate, any Takeover Proposal or Frustrating Transaction, (ii) enter into
any agreement with respect to any Takeover Proposal or Frustrating Transaction
or (iii) enter into, continue or otherwise participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or otherwise cooperate in any way with, or assist or participate in any
effort or attempt by any person with respect to, any Takeover Proposal or
Frustrating Transaction. Notwithstanding the foregoing and
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notwithstanding Section 3(e), nothing in this Agreement shall limit or
restrict a Stockholder that is a director of the Company or limit or restrict
a partner or an employee or agent of a Stockholder that is a director of the
Company from acting in his or her or its capacity as a member of the Board of
Directors of the Company to the extent that such Board of Directors is
engaging in activities expressly and specifically permitted under the proviso
to Section 4.02(a) of the Merger Agreement.
(e) (i) Such Stockholder shall use his or her or its 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 the other parties in doing, all things necessary,
proper or advisable to consummate and make effective, in the most expeditious
manner practicable, the transactions contemplated by this Agreement and the
Merger Agreement. Such Stockholder shall not commit or agree to take any
action inconsistent with the transactions contemplated by this Agreement or
the transactions contemplated by the Merger Agreement.
(ii) Such Stockholder shall not, and such Stockholder shall not
permit any of its subsidiaries to, or authorize or permit any director,
officer, employee or partner of such Stockholder or any of its
subsidiaries or any investment banker, attorney or other advisor or
representative of such Stockholder or any of its subsidiaries to,
directly or indirectly, issue any press release or make any other public
statement with respect to the Merger Agreement, this Agreement, the
Merger or any of the other transactions contemplated by the Merger
Agreement or any of the transactions contemplated by this Agreement
without the prior written consent of Parent, except as may be required by
applicable law.
(f) Such Stockholder hereby waives any rights of appraisal, or
rights to dissent from the Merger, that such Stockholder may have.
(g) (i) If (A) the Termination Fee becomes payable pursuant to
Section 5.06(b) of the Merger Agreement and a Takeover Proposal is consummated
or (B) a Takeover Proposal made by Parent (including any amendment of the
Merger Agreement) which provides for Transaction Consideration in excess of
$4.65 (the "Deal Price") per share is consummated (any Takeover Proposal
referred to in clause (A) or (B) above is referred to herein as a
"Transaction"), then such Stockholder shall pay to Parent an amount in cash
equal to such Stockholder's Profit; provided, however, that if all or any part
of the Transaction Consideration which such Stockholder is entitled to receive
is not cash, then such Stockholder's Profit shall be paid to Parent in each
type of consideration paid to such Stockholder and in the same proportions as
the types of consideration comprising the Transaction Consideration which such
Stockholder is entitled to receive, in each case determined at the close of
business on the date of the consummation of the Transaction, such that (A) in
respect of Transaction Consideration to be paid to such Stockholder in cash,
Parent shall be paid Profits by such Stockholder in cash in an amount equal to
the aggregate Transaction Consideration to be paid to such Stockholder in cash
multiplied by a fraction (a) the numerator of which is equal to such
Stockholder's Profit and (b) the denominator of which is equal to the
aggregate Transaction Consideration to be received by
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such Stockholder (such fraction, the "Profit Percentage"), (B) in respect of
Transaction Consideration to be paid to such Stockholder in the form of
securities, Parent shall be paid Profits by such Stockholder, for each type of
securities to be so paid, in the form of that number of such securities that
is equal to the total number of such securities to be paid to such Stockholder
multiplied by the Profit Percentage, and (C) in respect of Transaction
Consideration to be paid to such Stockholder in consideration of a type other
than cash or securities, Parent shall be paid Profits by such Stockholder in
the form of such type of consideration and in an amount equal to the aggregate
fair market value of such consideration to be paid to Stockholder, with such
fair market value determined as of the date of the consummation of the
Transaction, multiplied by the Profit Percentage; provided, however, that all
such determinations shall be made as of the close of business on the date of
the consummation of the relevant Transaction without any regard to any events
or circumstances occurring thereafter (such as changes in the trading price of
any securities). Such Profits shall be paid to Parent, for each type of
consideration, within five business days after the receipt by such Stockholder
of such consideration. Any payment of Profit under this Section 3(g) shall (A)
if paid in cash, be paid by wire transfer of same day funds to an account
designated by Parent, and (B) if paid through the transfer of securities or
other non-cash consideration, be paid through the delivery of such securities
or other non-cash consideration, suitably endorsed or otherwise documented for
transfer (if applicable), to Parent at its address set forth in Section 8.02
of the Merger Agreement.
(ii) The "Profit" of each Stockholder shall mean, as of the close of
business on the date of consummation of a Transaction, the amount (if a
positive number) equal to (A) the product of (1) the Transaction
Consideration which such Stockholder is entitled to receive minus the
Deal Price (as determined at such time) multiplied by (2) the number of
Subject Shares held by such Stockholder on the date of this Agreement
(other than any Subject Shares sold, transferred and delivered to Parent
or its designee pursuant to Section 3(h) hereof), minus (B) any Profit
Taxes.
(iii) "Transaction Consideration" shall mean, with respect to any
Transaction, the fair market value of the consideration which such
Stockholder is entitled to receive (including any residual interest in
the Company retained immediately following consummation of a Transaction)
in respect of each share of Company Common Stock of such Stockholder in
such Transaction, determined as of the close of business on the date of
the consummation of such Transaction, provided that if different types or
amounts of consideration are to be paid (or retained) in a Transaction,
the "Transaction Consideration" shall be determined by dividing (1) the
aggregate fair market value of all the consideration (determined as of
the close of business on the date of the consummation of such
Transaction) so paid to (and retained by) such Stockholder by (2) the
number of Subject Shares held by such Stockholder on the date of this
Agreement (other than any Subject Shares sold, transferred and delivered
to Parent or its designee pursuant to Section 3(h) hereof).
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(iv) For purposes of this Section 3(g), the "fair market value" of
any noncash consideration consisting of:
(A) securities listed on a national securities exchange or
traded on the NASDAQ shall be equal to the average closing price per
share of such security as reported on such exchange or NASDAQ for
the 10 trading days prior to the date of determination; and
(B) consideration which is other than securities of the form
specified in clause (A) of this clause (iv) shall be determined by a
nationally recognized independent investment banking firm mutually
selected, within three business days after the event requiring
selection of such investment banking firm, by Parent and the
Stockholders, which determination shall be made by such investment
banking firm within 15 business days after the date of such event;
provided, however, that if Parent and the Stockholders do not agree
within three business days after the date of such event as to the
selection of an investment banking firm, then, by the end of the
fifth business day after the date of such event, each of Parent, on
the one hand, and the Stockholders, on the other hand, shall select
an investment banking firm, which two investment banking firms shall
jointly make such determination within 20 business days after the
date of such event, or, if such two investment banking firms are
unable to agree on such determination, the two investment banking
firms shall, by the end of the 20th business day after the date of
such event, select a third investment banking firm and notify such
third investment banking firm in writing (with a copy to Parent and
each Stockholder) of their respective determinations of the fair
market value of such noncash consideration, following which such
third investment banking firm shall, within 15 business days after
the date of its selection, notify Parent and each Stockholder in
writing of its selection of one or the other of the two original
determinations of the fair market value of such noncash
consideration; provided further, that the reasonable and customary
fees and expenses of all such investment banking firms shall be
borne equally by Parent, on the one hand, and the Stockholders, on
the other hand. The determination of the investment banking firm
shall be binding upon the parties.
(v) The "Profit Taxes" of each Stockholder shall mean the net amount
of income taxes (U.S. federal, state and local) actually incurred by such
Stockholder solely as a result of either the receipt of Profits by such
Stockholder or the payment of Profits by such Stockholder to Parent in
accordance with the terms of this Agreement, in each case determined
taking into account any income, gain, deduction, loss or offset against
income taxes attributable to the payment of Profits by such Stockholder
to Parent in accordance with the terms of this Agreement; provided,
however, that solely for the purposes of calculating Profit Taxes, clause
(B) of the definition of Profits shall be disregarded. Solely for
purposes of calculating Profit Taxes, in the case of a Stockholder that
is treated
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as a pass-through entity for U.S. federal, state or local income tax
purposes, as the case may be, the term "Stockholder" shall mean any
direct member of such pass-through entity and any indirect member of such
pass-through entity that owns its interest in such pass-through entity to
the extent it owns such interest through one or more other pass-through
entities. For the purposes of this clause, a "pass-through entity"
includes, without limitation, a partnership, disregarded entity, trust,
subchapter S corporation, controlled foreign corporation, foreign person
holding company or a passive foreign investment company to the extent a
qualifying electing fund election has been made with respect to it.
(h) Such Stockholder agrees that, at the request of Parent (an
"Option Exercise"), such Stockholder shall sell, transfer and deliver or cause
to be sold, transferred and delivered to Parent (or its designees or
assignees), and Parent (or its designees or assignees) shall purchase from
such Stockholder, all or any portion (as specified by Parent) of the Subject
Shares of such Stockholder within three business days following the later of
(x) such request and (y) the last to occur of (i) the expiration or
termination of any waiting period (and any extension thereof) applicable to
such sale and purchase under the HSR Act or any other applicable competition,
merger control, antitrust or similar law or regulation and (ii) the receipt of
any other regulatory approvals applicable to such sale and purchase, for a
purchase price per share equal to the Deal Price.
SECTION 4. Grant of Irrevocable Proxy; Appointment of Proxy. (a)
Each Stockholder hereby irrevocably grants to, and appoints, Parent and Xxxxx
X. Xxxxxxxxx, its Vice President - Assistant General Counsel, Xxxxxx Xxxxxxx,
its Assistant Secretary and Senior Counsel, and Xxxxx X. Xxxxxxx, its Vice
President of Corporate Development, in their respective capacities as
designees of Parent, and any individual who shall hereafter succeed to any
such office of Parent, and each of them individually, such Stockholder's proxy
and attorney-in-fact (with full power of substitution), for and in the name,
place and stead of such Stockholder, to vote all of such Stockholder's Subject
Shares (owned of record or beneficially), or grant a consent or approval in
respect of such Subject Shares, (i) in favor of the adoption of the Merger
Agreement and the approval of the terms thereof and of the Merger and each of
the other transactions contemplated by the Merger Agreement, (ii) against any
Takeover Proposal or any Frustrating Transaction and (iii) otherwise in
accordance with Section 3 of this Agreement. The proxy granted in this Section
4 shall expire upon the termination of this Agreement.
(b) Each Stockholder represents that any proxies heretofore given in
respect of such Stockholder's Subject Shares are not irrevocable, and that all
such proxies are hereby revoked.
(c) Each Stockholder hereby affirms that the irrevocable proxy set
forth in this Section 4 is given in connection with the execution of the
Merger Agreement, and that such irrevocable proxy is given to secure the
performance of the duties of such Stockholder under this Agreement. Each
Stockholder hereby further affirms that the irrevocable proxy is coupled with
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an interest and may under no circumstances be revoked. Each Stockholder hereby
ratifies and confirms all that such irrevocable proxy may lawfully do or cause
to be done by virtue hereof. Each such irrevocable proxy is executed and
intended to be irrevocable in accordance with the provisions of Section 212(e)
of the DGCL.
SECTION 5. Further Assurances. Each Stockholder shall, from time to
time, execute and deliver, or cause to be executed and delivered, such
additional or further consents, documents and other instruments as Parent may
request for the purpose of effectuating the matters covered by this Agreement,
including the grant of the proxies set forth in Section 4 of this Agreement.
SECTION 6. Certain Events. Each Stockholder agrees that this
Agreement and the obligations hereunder shall attach to such Stockholder's
Subject Shares and shall be binding upon any person or entity to which legal
or beneficial ownership of such Subject Shares shall pass, whether by
operation of law or otherwise, including such Stockholder's heirs, guardians,
administrators or successors, and each Stockholder further agrees to take all
actions necessary to effectuate the foregoing. In the event of any stock
split, stock dividend, reclassification, merger, reorganization,
recapitalization or other change in the capital structure of the Company
affecting the capital stock of the Company, the number of Subject Shares
listed on Schedule A hereto opposite the name of each Stockholder shall be
adjusted appropriately and the Deal Price will be adjusted appropriately.
SECTION 7. Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or
in part, by operation of law or otherwise, by any of the parties hereto
without the prior written consent of the other parties hereto, except that
Parent may in its sole discretion assign, in whole or in one or more parts,
(x) any or all of its rights, interests or obligations under this Agreement to
any direct or indirect wholly owned subsidiary of Parent and (y) any of or all
its rights, interests and obligations under Section 3(g) or Section 3(h) to
one or more of third parties, but no such assignment shall relieve Parent of
any of its obligations under this Agreement. Any purported assignment in
violation of this Section 7 shall be void. Subject to the preceding sentences
of this Section 7, this Agreement shall be binding upon, inure to the benefit
of and be enforceable by, the parties hereto and their respective successors
and assigns.
SECTION 8. Termination. This Agreement shall terminate upon the
earlier of (i) the Effective Time and (ii) the termination of the Merger
Agreement in accordance with its terms; provided, however, that if the Merger
Agreement is terminated under any of the circumstances described in Section
5.06(b) of the Merger Agreement, then (A) Section 3(g) of this Agreement (and
any other provisions of this Agreement related thereto (including Section 6
hereof)) shall continue in full force and effect during the 12 month period
described in Section 5.06(b)(i) of the Merger Agreement and (B) Section 3(h)
of this Agreement (and any other provisions of this Agreement related thereto
(including Sections 3(c) and 6 hereof)) shall continue in full force and
effect for six months following the termination of the Merger
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Agreement). Notwithstanding the foregoing, this Agreement shall not terminate
with respect to any Option Exercise until the sale, transfer and delivery of
the Subject Shares with respect to such Option Exercise have been effected. No
termination of this Agreement shall relieve any party hereto from any
liability for any breach of any provision of this Agreement prior to
termination.
SECTION 9. General Provisions. (a) Amendments. This Agreement is
between each Stockholder and Parent severally and not jointly and may not be
amended except by an instrument in writing signed by Parent and such amending
Stockholder. Any such amendment shall be effective only as to Parent and such
amending Stockholder.
(b) Notices. All notices, requests, clauses, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered personally, telecopied (with confirmation) or sent by
overnight or same-day courier (providing proof of delivery) to Parent in
accordance with Section 8.02 of the Merger Agreement and to the Stockholders
at their respective addresses set forth on Schedule A hereto (or at such other
address for a party as shall be specified by like notice), with a copy to:
Xxxx X. Xxxxxx
Xxxxxx & Xxxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
(000) 000-0000 (fax)
Xxxx X. Xxxxxxxx
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
(000) 000-0000 (fax)
(c) Interpretation. When a reference is made in this Agreement to a
Section or a Schedule, such reference shall be to a Section of, or a Schedule
to, this Agreement unless otherwise indicated. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to
be followed by the words "without limitation". The words "hereof", "herein"
and "hereunder" and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement. The term "or" is not exclusive. The definitions contained in this
Agreement are applicable to the singular as well as the plural forms of such
terms. Any agreement or instrument defined or referred to herein or in any
agreement or instrument that is referred to herein means such agreement or
instrument as from
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time to time amended, modified or supplemented. References to a person are
also to its permitted successors and assigns.
(d) Counterparts; Effectiveness. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been
signed by each of the parties hereto and delivered to the other party. The
effectiveness of this Agreement shall be conditioned upon the execution and
delivery of the Merger Agreement by each of the parties thereto.
(e) Entire Agreement; No Third-Party Beneficiaries. This Agreement
(including the documents and instruments referred to herein) (i) constitutes
the entire agreement and supersedes all prior agreements and understandings,
both written and oral, among the parties hereto with respect to the subject
matter of this Agreement and (ii) is not intended to confer upon any person
other than the parties hereto (and the persons specified as proxies in Section
4) any rights or remedies.
(f) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ANY
PRINCIPLES OF CONFLICTS OF LAWS OF SUCH STATE.
(g) 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 to the
fullest extent permitted by applicable law in an acceptable manner and to the
end that the transactions contemplated hereby are fulfilled to the extent
possible.
SECTION 10. Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction
or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in any court of the
United States located in the State of Delaware or in any Delaware state court,
this being in addition to any other remedy to which they are entitled at law
or in equity. In addition, each of the parties hereto (a) consents to submit
itself to the personal jurisdiction of any court of the United States located
in the State of Delaware or of any Delaware state court in the event any
dispute arises out of this Agreement or the transactions contemplated by this
Agreement, (b) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court and (c)
agrees that it will not bring any action relating to this Agreement or the
transactions contemplated by this Agreement in any court other than a court of
the United States located in the State of Delaware or a Delaware state court.
12
SECTION 11. Waiver of Jury Trial . Each party hereto hereby waives,
to the fullest extent permitted by applicable law, any right it may have to a
trial by jury in respect of any suit, action or other proceeding directly or
indirectly arising out of, under or in connection with this Agreement. Each
party hereto (a) certifies that no representative, agent or attorney of any
other party has represented, expressly or otherwise, that such party would
not, in the event of any action, suit or proceeding, seek to enforce the
foregoing waiver and (b) acknowledges that it and the other parties hereto
have been induced to enter into this Agreement, by, among other things, the
mutual waiver and certifications in this Section 11.
13
IN WITNESS WHEREOF, Parent has caused this Agreement to be signed by
its officer thereunto duly authorized and each Stockholder has signed this
Agreement, all as of the date first written above.
INTERNATIONAL BUSINESS
MACHINES CORPORATION,
by
/s/ Xxxxx X. Xxxxxxx
---------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President,
Corporate Development
STOCKHOLDERS:
/s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx Family Trust
By: Xxxxxxx X. Xxxxxxx, Trustee
/s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
/s/ Xxxxxxx X. Xxxxxxx Xx.
------------------------------------
Name: Quantum Industrial Partners LDC
By: Xxxxxxx X. Xxxxxxx Xx.
Position: Attorney-in-Fact
/s/ Xxxxxxx X. Xxxxxxx Xx.
------------------------------------
Name: SFM Domestic Investments LLC
By: Xxxxxxx X. Xxxxxxx Xx.
Position: Attorney-in-Fact
/s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
/s/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Family Trust
By: Xxxxxxx Xxxxxx, Trustee
14
/s/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxxx Family Limited Partnership
By: Xxxxxx X. Xxxxxxx
Position: General Partner
/s/ Xxxxxx X. Piementel
------------------------------------
Name: Xxxxxx X. Piementel
/s/ Xxxxxx X. Piementel
------------------------------------
Name: Xxxxxx X. and Xxxxxx X. Piementel
Joint Trust
By: Piementel, Xxxxxx X., Trustee
Schedule A
Name and Address of Number of Subject Shares
Stockholder Owned of Record or Beneficially
----------- --------------------------------
Xxxxxxx X. Xxxxxxx
c/x Xxxxxxxx Xxxxxxxxxx, LLP
00 Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx 1,333,332
The Xxxxxxx Family Trust
c/x Xxxxxxxx Xxxxxxxxxx, LLP
00 Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx 6,069,478
Quantum Industrial Partners LDC
c/x Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Esq. 1,321,586
SFM Domestic Investments LLC
c/o Soros Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Esq. 146,843
Xxxxxxx Family Trust
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx, XX 00000 226,873
Xxxxxxx Family Limited Partnership
000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx, XX 00000 166,666
Xxxxxx X. Piementel
c/o Red Point Ventures
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000 139,646
Xxxxxx X. and Xxxxxx X. Piementel Joint Trust
c/o Red Point Ventures
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000 1,602
Xxxxxx X. Xxxxxxx
00 Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000 16,528
