COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT is made as of the 5th day of May,
1997, by and between Netspeak Corporation, a Florida corporation (the
"Company"), and ACT Networks, Inc., a Delaware corporation (the "Investor").
RECITALS
WHEREAS, the Company has filed with the Securities Exchange Commission
(the "SEC"), a Registration Statement on Form S-1 (the "Registration Statement")
to issue up to 2,300,000 shares of its common stock (the "Registered Stock") in
an initial public offering (the "IPO");
WHEREAS, the Investor wishes to give the Company an indication of
interest to purchase $2,000,000 of Registered Stock;
NOW, THEREFORE, in consideration of the foregoing and other valuable
consideration, the parties hereto agree as follows:
1. THE SECURITIES.
1.1 INDICATION OF INTEREST.
The Investor has received and reviewed a copy of the
Registration Statement and hereby indicates to the Company that it has an
interest in purchasing that number of shares of the Company's Registered Stock
(such shares, the "Securities") in the IPO which equals $2,000,000 divided by
the actual price per share of the Registered Stock as sold to the public in the
IPO. Upon the Registration Statement being declared effective by the SEC, the
Company will furnish the Investor with a definitive prospectus. The Investor
shall promptly notify the Company of its election to proceed with the purchase
of the Securities, subject to the other temrs and conditions set forth herein.
1.2 CLOSING. The purchase and sale of the Securities shall
take place at the same time and place as the closing of the IPO, subject to the
prior or concurrent fulfillment of all of the closing conditions set forth
herein (which time and place are designated as the "Closing"). The Company shall
provide the Investor with at least three (3) days written notice prior to the
Closing. At the Closing, the Company shall deliver to the Investor a certificate
representing the Common Stock that the Investor is purchasing against payment of
the purchase price therefor. The purchase price shall be paid by the Investor in
accordance with instructions furnished by Josephthal, Lyon & Xxxx Incorporated
and Cruttenden Xxxx Incorporated, the representatives (the "Representatives") of
the several underwriters of the IPO.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Investor that:
2.1 UNDERWRITING AGREEMENT REPRESENTATIONS. Each of the
representations and warranties to be made by the Company to the Underwriters in
Section I of the Underwriting Agreement to be entered into between the Company
and the Representatives relating to the IPO (the "Underwriting Agreement") will
be true and accurate as of the date thereof and at the Closing. Such
representations and warranties shall be deemed to be incorporated herein as if
set forth herein, and the Investor shall be entitled to rely on the same as if
such representations and warranties were made directly to the Investor as of the
date of the Underwriting Agreement and at the Closing.
2.2 AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement the performance of all
obligations of the Company hereunder has been taken or will be taken prior to
the Closing, and this Agreement constitutes the valid and legally binding
obligation of the Company, enforceable in accordance with its terms, except (i)
as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and
other laws of general application affecting enforcement of creditors' rights
generally, and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies.
2.3 LITIGATION. There is no action, suit, proceeding or
investigation pending or currently threatened against the Company that questions
the validity of this Agreement or the right of the Company to enter into this
Agreement, or to consummate the transactions contemplated hereby. The Company is
not a party or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or instrumentality which
would have a material adverse effect on the Company's ability to enter into this
Agreement, or to consummate the transactions contemplated hereby.
2.4 COMPLIANCE WITH OTHER INSTRUMENTS.
(a) The Company is not in violation or default in any
material respect of any provision of its Articles or Bylaws, or any instrument,
judgment, order, writ, decree or contract to which it is a party or by which it
is bound, or, to the best of its knowledge, of any provision of any federal or
state statute, rule or regulation applicable to the Company, in each case, which
violation or default would have a material adverse effect on the Company's
ability to enter into this Agreement or to consummate the transactions
contemplated hereby, or which would have a material adverse effect on the
Company, its properties, business or financial condition. The execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby will not (a) result in any such violation or
default or (b) be in conflict with or constitute, with or without the passage of
time and giving of notice, either a default under any such provision,
instrument, judgment, order, writ, decree or contract to which the Company is a
party or to which its assets are bound, or an event that results in the
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creation of any material lien, charge or encumbrance upon any assets of the
Company or the suspension, revocation, impairment, forfeiture, or nonrenewal of
any material permit, license, authorization, or approval applicable to the
Company, its business or operations or any of its assets or properties.
3. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR. The Investor hereby
represents and warrants that it has full power and authority to enter into this
Agreement and this Agreement constitutes its valid and legally binding
obligation, enforceable in accordance with its terms.
4. CONDITIONS OF INVESTOR'S OBLIGATIONS AT CLOSING. The obligations of
the Investor under Section I of this Agreement are subject to the turbulent on
or before the Closing of each of the following conditions, the waiver of which
shall not be effective unless the Investor consents in writing thereto:
4.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company contained in Section 2 shall be true on and as of the
Closing with the same effect as though such representations and warranties had
been made on and as of the date of such Closing.
4.2 PERFORMANCE. The Company shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that
are required to be performed or complied with by it on or before the Closing.
The Company shall have, concurrently with the Closing, consummated the IPO of at
least 1,500,000 shares of Registered Stock pursuant to the Registration
Statement (including the Securities) with gross proceeds of at least
$10,000,000. If the IPO has not been consummated prior to August 1, 1997, this
Agreement shall terminate and neither the Company nor the Investor shall have
any obligation hereunder.
4.3 QUALIFICATIONS. All authorizations, approvals, or permits,
if any, of any governmental authority or regulatory body of the United States or
of any state that are required in connection with the lawful issuance and sale
of the Securities pursuant to this Agreement and the Registration Statement, as
the case may be, shall be duly obtained and effective as of the Closing.
4.4 PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated at the Closing and
all documents incident thereto shall be reasonable satisfactory in form and
substance to Investor's counsel, and they shall have received all such
counterpart original and certified or other copies of such documents as they may
reasonably request.
4.5 OFFICER'S CERTIFICATE. The Company shall have delivered a
certificate executed by the Chief Executive Officer of the Company certifying as
to the matters set forth in Sections 4.1 and 4.2 hereof.
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4.6 DELIVERY OF STOCK CERTIFICATE. The Company shall have
delivered a Common Stock certificate representing the Securities acquired
hereunder.
4.7 CONSUMMATION OF TECHNOLOGY DEVELOPMENT AND LICENSE
AGREEMENT. The Company and the Investor shall have executed and delivered that
certain Technology Development and License Agreement to be dated the date
hereof, and the Company shall not be in breach or default under such agreement
in any material respect.
5. CONDITIONS OF THE COMPANY'S OBLIGATIONS AT CLOSING. The obligations
of the Company to the Investor under this Agreement are subject to the
fulfillment on or before the Closing of each of the following conditions by the
Investor.
5.1 Representations and Warranties. The representation and
warranty of the Investor contained in Section 3 shall be true on and as of the
Closing with the same effect as though such representation and warranty had been
made on and as of the Closing.
5.2 PAYMENT OF PURCHASE PRICE. The Investor shall have
delivered the purchase price in accordance with the provisions of Section 1.2.
5.3 QUALIFICATIONS. All authorizations, approvals, or permits,
if any, of any governmental authority or regulatory body of the United States or
of any state that are required in connection with the lawful issuance and sale
of the Securities pursuant to this Agreement and the Registration Statement, as
the case may be, shall be duly obtained and effective as of the Closing.
5.4 DIRECTOR'S AND OFFICER'S INSURANCE. The Company shall have
in place and in full force and effect, a director's and officer's insurance
policy in the minimum amount of $5,000,000.00.
6. COVENANTS OF THE COMPANY.
6.1 APPOINTMENT OF XXXXXX XXXX. Immediately following the
Closing, the Company shall appoint Xxxxxx Xxxx to its Board of Directors.
Furthermore, for a period of two (2) years after the Closing, at each
shareholders' meeting at which directors are to be elected, the Company agrees
to nominate Xxxxxx Xxxx as part of its management's slate of nominees to its
Board of Directors.
6.2 MAINTENANCE OF DIRECTOR'S AND OFFICER'S INSURANCE POLICY.
The Company agrees to maintain and keep in full force and effect, for a period
of at least 2 years after the Closing, a director's and officer's insurance
policy in a minimum amount of $5,000,000.00.
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7. MISCELLANEOUS.
7.1 SURVIVAL OF WARRANTIES. The warranties, representations
and covenants of the Company and Investor contained in or made pursuant to this
Agreement shall survive the execution and delivery of this Agreement and the
Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investor or the Company.
7.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
7.3 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of California as applied to agreements
among California residents entered into and to be performed entirely within
California.
7.4 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.5 TITLES AND SUBTITLES. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
7.6 NOTICES. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or three
(3) days after deposit with the United States Post Office, by registered or
certified mail, postage prepaid and addressed to the party to be notified at the
address indicated for such party on the signature page hereof, or at such other
address as such party may designate by ten (10) days' advance written notice to
the other parties.
7.7 EXPENSES. Irrespective of whether the Closing is effected,
the Company shall pay all costs and expenses that it incurs with respect to the
negotiation, execution, delivery and performance of this Agreement. If any
action at law or in equity is necessary to enforce or interpret the terms of
this Agreement, the prevailing party shall be entitled to reasonable attorney's
fees, costs and necessary disbursements in addition to any other relief to which
such party may be entitled.
7.8 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally
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or in a particular instance and either retroactively or prospectively), only
with the written consent of the Company and the Investor.
7.9 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
7.10 ENTIRE AGREEMENT. This Agreement and the documents
referred to herein constitute the entire agreement among the parties and no
party shall be liable or bound to any other party in any manner by any
warranties, representations, or covenants except as specifically set forth
herein or therein.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
NETSPEAK CORPORATION
By:/s/ XXXXXX XXXXXXX
---------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
Address: 000 Xxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
INVESTOR:
ACT NETWORKS, INC.
By:/s/ XXXXXX X. XXXXXXX
---------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: CFO and Vice President
Finance and Administration
Address: 000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
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