VOTING AGREEMENT
Agreement (this "Agreement") made as of March 2, 2000 by and among
VerticalBuyer, Inc., a Delaware corporation (the "Company"), CSP Inc., a
Massachusetts corporation ("CSPI"), Xxx Xxxxx ("First Stockholder") and Xxxxxx
Xxxx ("Second Stockholder" and, collectively with First Stockholder, the
"Stockholders"). (The parties to this Agreement will hereinafter be referred to
as the "Parties.")
In consideration of the mutual covenants herein contained, the Parties
agree as follows:
1. Board of Directors; By-Laws. The Stockholders will vote all shares of
common stock, preferred stock or any other class of voting security of
VerticalBuyer now or hereafter owned or controlled by them (the "Shares"), and
otherwise to use their respective best efforts as stockholders of VerticalBuyer,
to elect one person designated by CSPI as a director of VerticalBuyer in any
subsequent election of directors of VerticalBuyer. The initial nominee of CSPI
to be director is Xxxxxxxxx Xxxxxxxxx, Chairman of the Board of Directors and
President of CSPI.
VerticalBuyer and the Stockholders agree not to take any action to remove
the person designated or nominated by CSPI as director, to change the number of
directors constituting the full Board of Directors, or to amend any provision of
the Certificate of Incorporation or By-Laws of VerticalBuyer relating to the
election and number of directors, as presently in effect, without the prior
written consent of CSPI.
2. Conduct of Business of VerticalBuyer. During the period from the date of
this Agreement and continuing until the effective date of a registration
statement filed with the Securities and Exchange Commission relating to the
Shares purchased by CSPI and the Shares underlying the warrant purchased by
CSPI, VerticalBuyer shall not do, cause or permit and shall cause its
subsidiaries not to do, cause or permit, any of the following, without the
affirmative vote of the person designated by CSPI as a director of
VerticalBuyer:
(a) Material Contracts. Enter into any material contract or commitment, or
violate, amend or otherwise modify or waive any of the terms of any of
its material contracts, other than in the ordinary course of business
consistent with past practice;
(b) Issuance of Securities. Issue, deliver or sell or authorize or propose
the issuance, delivery or sale of, or purchase or propose the purchase
of, any shares of its capital stock or securities convertible into, or
subscriptions, rights, warrants or options to acquire, or other
agreements or commitments of any character obligating it to issue any
such shares or other convertible securities.
(c) Intellectual Property. Transfer to any person or entity any rights to
its intellectual property other than in the ordinary course of
business consistent with past practice.
(d) Exclusive Rights. Enter into or amend any material agreements pursuant
to which any other party is granted exclusive marketing or other
exclusive rights of any type or scope with respect to any of its
services.
(e) Dispositions. Sell, lease, license or otherwise dispose of or encumber
any of its properties or assets which are material, individually or in
subsidiaries' business, taken as a whole, except in the ordinary
course of business consistent with past practice;
(f) Indebtedness. Incur any indebtedness for borrowed money or guarantee
any such indebtedness or issue or sell any debt securities or
guarantee any debt securities of others; (g) Leases. Enter into any
operating lease in excess of $24,000 per annum;
(h) Payment of Obligations. Pay, discharge or satisfy in an amount in
excess of $10,000 in any one case or $100,000 in the aggregate, any
claim, liability or obligation (absolute, accrued, asserted or
unasserted, contingent or otherwise) arising other than in the
ordinary course of business, other than the payment, discharge or
satisfaction of liabilities reflected or reserved against in the
financial statements of VerticalBuyer or its subsidiary, Lightseek
Limited;
(i) Capital Expenditures. Make any capital expenditures, capital additions
or capital improvements except in the ordinary course of business and
consistent with past practice;
(j) Insurance. Materially reduce the amount of any material insurance
coverage provided by insurance policies whether existing or placed
during the term of this Agreement;
(k) Termination or Waiver. Terminate or waive any right of substantial
value, other than in the ordinary course of business;
(l) Employee Benefit Plans; New Hires; Pay Increases. Adopt or amend any
employee benefit or stock purchase or option plan, or hire any new
officer level employee, or increase the salaries or wage rates of its
employees except in the ordinary course of business in accordance with
its standard past practice;
(m) Severance Arrangements. Grant any severance or termination pay (i) to
any director or officer or (ii) to any other employee except (A)
payments made pursuant to written agreements outstanding on the date
hereof or (B) grants which are made in the ordinary course of business
in accordance with its standard past practice;
(n) Lawsuits. Commence a lawsuit other than (i) for the routine collection
of bills, (ii) in such cases where it in good faith determines that
failure to commence suit would result in the material impairment of a
valuable aspect of its business;
(o) Acquisitions. Acquire or agree to acquire by merging or consolidating
with, or by purchasing a substantial portion of the assets of, or by
any other manner, any business or any corporation, partnership,
association or other business organization or division thereof, or
otherwise acquire or agree to acquire any assets which are material,
individually or in the aggregate, to its and its
parent's/subsidiaries' business, taken as a whole;
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(p) Taxes. Other than in the ordinary course of business, make or change
any material election in respect of taxes, adopt or change any
accounting method in respect of Taxes, file any material tax return or
any amendment to a material tax return, enter into any closing
agreement, settle any material claim or assessment in respect of
Taxes, or consent to any extension or waiver of the limitation period
applicable to any material claim or assessment in respect of taxes;
(r) Revaluation. Revalue any of its assets, including without limitation
writing down the value of inventory or writing off notes or accounts
receivable other than in the ordinary course of business; or
(s) Other. Take or agree in writing or otherwise to take, any action which
would cause a material breach of its representations or warranties
contained in any agreement or prevent it from materially performing or
cause it not to materially perform its covenants thereunder.
3. Assignment; Binding Effect. Subject to termination as provided in
Section 7, this Agreement shall be binding on the Parties and their respective
legal representatives, successors and assigns and on the transferees of any
Shares now owned or hereafter acquired by them.
4. Entire Agreement; Waiver. This Agreement contains the sole and entire
understanding of the Parties with respect to its subject matter. This Agreement
may not be changed or terminated or any performance or condition waived, in
whole or in part, except by agreement in writing signed by all of the Parties.
5. Counterparts. This Agreement may be executed in more than one
counterpart, each of which shall be deemed to be an original and which,
together, shall constitute one and the same instrument.
6. Applicable Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the substantive laws of The Commonwealth of
Massachusetts, without regard to its principles of conflicts of laws.
7. Legend. Each certificate for Shares shall bear a legend stating in
substance as follows:
"The rights of any holders of these shares are subject to the terms and
provisions of a Voting Agreement dated March 2, 2000 among VerticalBuyer
and certain shareholders of VerticalBuyer. Copies of such agreement may be
obtained without charge upon written request to the secretary of
VerticalBuyer."
8. Termination. This Agreement shall terminate and be of no further force
and effect upon the exercise redemption or expiration of all of the outstanding
Common Stock Purchase Warrants of VerticalBuyer issued to CSPI and dated the
date hereof providing for the purchase, subject to adjustment, of 3,000,000
shares of VerticalBuyer's Common Stock.
IN WITNESS WHEREOF, this Agreement has been duly executed as of the date
first above written.
VERTICALBUYER, INC.
By: /s/Xxx Xxxxx
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Xxx Xxxxx,
President
CSPI, INC.
By: /s/Xxxxxxxxx Xxxxxxxxx
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Xxxxxxxxx Xxxxxxxxx,
Chief Executive Officer
/s/Xxx Xxxxx /s/Xxxxxx Xxxx
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Xxx Xxxxx Xxxxxx Xxxx
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