EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
AMONG
WEBHIRE, INC.,
HWK ACQUISITION CORP.,
HIREWORKS, INC.
AND
THE STOCKHOLDERS OF
HIREWORKS, INC.
Dated as of July 9, 1999
AGREEMENT AND PLAN OF MERGER
INDEX
SECTION 1. THE MERGER......................................................................................1
1.1 The Merger......................................................................................1
1.2 Closing.........................................................................................2
1.3 Effective Time..................................................................................2
1.4 Effect of the Merger............................................................................2
1.5 Conversion of Securities........................................................................2
1.6 Cash and Stock Consideration....................................................................3
1.7 Conversion of Stock Options.....................................................................4
1.8 Cancellation of Stock Options...................................................................6
1.9 Principal Stockholder Approval and Waiver.......................................................6
1.10 Xxxxxx Exercise, Termination and Severance......................................................6
1.11 Xxxxxx Exercise.................................................................................6
1.12 Withholding Taxes...............................................................................6
1.13 Escrow Arrangements.............................................................................7
1.14 Release.........................................................................................7
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE PRINCIPAL STOCKHOLDERS....................8
2.1 Making of Representations and Warranties........................................................8
2.2 Organization and Qualifications of the Company; Residence.......................................8
2.3 Capital Stock of the Company; Beneficial Ownership..............................................9
2.4 Subsidiaries....................................................................................9
2.5 Authority of the Company and the Principal Stockholders.........................................9
2.6 Real and Personal Property.....................................................................11
2.7 Financial Statements...........................................................................11
2.8 Taxes..........................................................................................12
2.9 Collectibility of Accounts Receivable..........................................................13
2.10 Absence of Certain Changes.....................................................................14
2.11 Ordinary Course................................................................................15
2.12 Banking Relations..............................................................................15
2.13 Intellectual Property..........................................................................16
2.14 Contracts......................................................................................18
2.15 Litigation.....................................................................................20
2.16 Compliance with Laws...........................................................................20
2.17 Insurance......................................................................................20
2.18 Warranty or Other Claims.......................................................................20
2.19 Powers of Attorney.............................................................................20
2.20 Finder's Fee...................................................................................21
2.21 Permits; Burdensome Agreements.................................................................21
(i)
2.22 Corporate Records; Copies of Documents.........................................................21
2.23 Transactions with Interested Persons...........................................................21
2.24 Employee Benefit Programs......................................................................22
2.25 Environmental Matters..........................................................................22
2.26 List of Directors and Officers.................................................................22
2.27 Disclosure.....................................................................................22
2.28 Employees; Labor Matters.......................................................................23
2.29 Customers and Distributors.....................................................................23
SECTION 3. INVESTMENT REPRESENTATIONS AND WARRANTIES OF THE PRINCIPAL STOCKHOLDERS........................24
SECTION 4. REPRESENTATIONS AND WARRANTIES OF WEBHIRE AND ACQUISITION CORP.................................25
4.1 Making of Representations and Warranties.......................................................25
4.2 Organization...................................................................................25
4.3 Capital Stock of Webhire.......................................................................25
4.4 Authority......................................................................................26
4.5 SEC Reports....................................................................................26
4.6 Finder's Fee...................................................................................27
4.7 Disclosure.....................................................................................27
4.8 Tax-Free Reorganization........................................................................27
SECTION 5. CONDITIONS.....................................................................................27
5.1 Conditions to the Obligations of Webhire and the Acquisition Corp..............................27
5.2 Conditions to Obligations of the Company and the Principal Stockholders........................30
SECTION 6. RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING...................................................31
6.1 Survival of Representations, Etc...............................................................31
6.2 Xxxxxx Xxxxxxxxx Payment.......................................................................31
6.3 Option Cancellation Payments...................................................................31
6.4 Confidentiality; Trading in Webhire Stock......................................................31
SECTION 7. INDEMNIFICATION......................................................................................32
7.1 Indemnification by the Principal Stockholders..................................................32
7.2 Limitations on Indemnification by the Principal Stockholder....................................32
7.3 Notice; Defense of Claims......................................................................33
7.4 Fair Market Value..............................................................................34
7.5 Indemnification by Webhire.....................................................................34
7.6 Limitation on Indemnification by Webhire.......................................................34
7.7 Stockholder Representative.....................................................................35
SECTION 8. MISCELLANEOUS........................................................................................35
8.1 Fees and Expenses..............................................................................35
(ii)
8.2 Governing Law..................................................................................36
8.3 Notices........................................................................................36
8.4 Entire Agreement...............................................................................37
8.5 Assignability; Binding Effect..................................................................37
8.6 Captions and Gender............................................................................38
8.7 Execution in Counterparts......................................................................38
8.8 Amendments.....................................................................................38
8.9 Severability...................................................................................38
8.10 Publicity and Disclosures......................................................................38
8.11 Arbitration....................................................................................38
8.12 Consent to Jurisdiction........................................................................39
8.13 Specific Performance...........................................................................40
(iii)
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of July 9, 1999 (the
"Agreement"), by and among WEBHIRE, INC., a Delaware corporation
("Webhire"), HWK ACQUISITION CORP., a Delaware corporation
(the "Acquisition Corp"), HIREWORKS, INC., a Delaware corporation (the
"Company"), and Xxxxx X. Xxxxxxxx ("Xxxxxxxx"), Xxxxxxx Xxxxxx ("Xxxxxx")
and Xxxxx X. Xxxxxx ("Xxxxxx" and, collectively with Xxxxxxxx and Xxxxxx, the
"Principal Stockholders").
WHEREAS, upon the terms and subject to the conditions of this Agreement
and in accordance with the General Corporation Law of the State of Delaware
("Delaware Law"), Webhire, the Acquisition Corp and the Company desire to
enter into a business combination transaction pursuant to which the Acquisition
Corp will merge with and into the Company (the "Merger");
WHEREAS, the Board of Directors of the Company has adopted a resolution
approving this Agreement pursuant to Section 251(b) of Delaware Law;
WHEREAS, the Board of Directors of the Acquisition Corp has adopted a
resolution approving this Agreement pursuant to Section 251(b) of Delaware Law;
WHEREAS, each of Webhire, the sole stockholder of the Acquisition Corp,
and the Principal Stockholders, the sole stockholders of the Company, has
adopted this Agreement in accordance with Section 251(c) of Delaware Law; and
WHEREAS, the parties intend that the Merger shall qualify as a tax-free
reorganization under Section 368(a)(1)(A) of the Internal Revenue Code of 1986,
as amended (the "Code") by reason of Section 368(a)(2)(E) of the Code.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, Webhire, the Acquisition Corp, the Company, and the Principal
Stockholders hereby agree as follows:
SECTION 1. THE MERGER.
1.1 THE MERGER. Upon the terms and subject to the conditions set forth
in this Agreement, and in accordance with the relevant provisions of Delaware
Law, at the Effective Time (as defined in Section 1.3), the Acquisition Corp
shall be merged with and into the Company. As a result of the Merger, the
separate corporate existence of the Acquisition Corp shall cease and the Company
shall continue as the surviving corporation of the Merger (the "Surviving
Corporation").
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1.2 CLOSING. The closing of the Merger (the "Closing") will be held on
the date hereof at the offices of Xxxxxxx, Procter & Xxxx LLP, Exchange Place,
Boston, Massachusetts (or such other place and date as the parties may agree)
or, if all of the conditions to the obligations of the parties hereto have not
been satisfied or waived by such date, on such mutually agreeable later date as
soon as practicable after the satisfaction or waiver of all conditions to the
obligations of the parties hereto (the "Closing Date").
1.3 EFFECTIVE TIME. As of the Closing, the parties hereto shall cause
the Merger to be consummated by filing a certificate of merger (the "Certificate
of Merger") with the Secretary of State for the State of Delaware in such form
as required by, and executed in accordance with, the relevant provisions of,
Delaware Law (the date and time of such filing being the "Effective Time").
1.4 EFFECT OF THE MERGER. At the Effective Time, the effect of the
Merger shall be as provided in Section 259 of Delaware Law. Without limiting the
generality of the foregoing, and subject to Section 259 of Delaware Law, at the
Effective Time, except as otherwise provided herein, all of the property,
rights, privileges, powers and franchises of the Company and the Acquisition
Corp shall vest in the Surviving Corporation, and all debts, liabilities and
duties of the Company and the Acquisition Corp shall become the debts,
liabilities and duties of the Surviving Corporation. At the Effective Time, the
Certificate of Incorporation of the Acquisition Corp as in effect immediately
prior to the Effective Time shall be the Certificate of Incorporation of the
Surviving Corporation and the By-Laws of the Acquisition Corp as in effect
immediately prior to the Effective Time shall become the By-Laws of the
Surviving Corporation. At the Effective Time, the sole director of the Surviving
Corporation shall be Xxxxxxx X. Xxxxx. The initial officers of the Surviving
Corporation shall be as specified in a resolution of the Board of Directors
adopted after the Effective Time.
1.5 CONVERSION OF SECURITIES. At the Effective Time and without any
action on the part of Webhire, the Acquisition Corp, the Company, the Principal
Stockholders or any other holders of any of the securities of any of those
corporations:
(a) each share of the Company's common stock, par value $.01
per share (the ACompany Stock"), issued and outstanding immediately prior to the
Effective Time shall be converted into the right to receive the following
consideration without interest thereon and only upon the surrender of the
certificate formerly representing such share of Company Stock: (i) the Per Share
Cash Payment (as defined in Section 1.6(a) below) and (ii) the Per Share Stock
Payment (as defined in Section 1.6(b) below);
(b) each share of Company Stock held in the treasury of the
Company immediately prior to the Effective Time shall automatically be canceled
and extinguished without any conversion thereof and no payment shall be made
with respect thereto;
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(c) each share of common stock of Acquisition Corp issued and
outstanding immediately prior to the Effective Time shall be converted into and
exchangeable for one validly issued, fully paid and nonassessable share of the
common stock of the Surviving Corporation; and
(d) the stock transfer books of the Company shall be closed,
and there shall be no further registration of transfers of shares of Company
Stock thereafter on the records of the Company.
1.6 CASH AND STOCK CONSIDERATION.
(a) CASH PURCHASE PRICE AT CLOSING. The aggregate cash
consideration payable by Webhire to the stockholders of the Company for their
Company Stock (the "Aggregate Cash Purchase Price") shall be the product
obtained by multiplying (i) the Number of Outstanding Company Shares by (ii) the
Per Share Cash Payment. For purposes of this Agreement, the following terms
shall have the following meanings: (A) the "Number of Outstanding Company
Shares" shall mean the total number of shares of Company Stock outstanding
immediately prior to the Effective Time; (B) the "Per Share Cash Payment" shall
mean the product obtained by multiplying (i) the Per Share Fully-Diluted Share
Value by (ii) ten percent (10%); (C) the "Per Share Fully-Diluted Share Value"
shall mean the quotient obtained by dividing (i) the Fully-Diluted Share Value
by (ii) the Number of Fully-Diluted Company Shares; (D) the "Number of
Fully-Diluted Company Shares" shall mean the total number of shares of Company
Stock outstanding immediately prior to the Closing assuming the exercise at such
time of all outstanding options to purchase shares of Company Stock, including
the Canceled Options (as defined in Section 1.8 below) (the "Company Options");
(E) the "Fully-Diluted Share Value" shall mean $1,997,500 less the Company
Deficit; and (F) the "Company Deficit" shall mean the greater of (i) the amount
by which the Company's total liabilities through and including the Closing
(other than the Company's legal expenses to be paid by Webhire pursuant to
Section 8.1 hereof, the Xxxxxx Xxxxxxxxx Payment (defined in Section 1.10 hereof
and the Xxxxxx Option Payment (defined in Section 1.8 hereof)) exceed the
Company's total current assets as reflected on the balance sheet of the Company
as of the close of business on the Closing Date and (ii) $0.00. Such Closing
Date balance sheet shall be prepared on a pro forma basis (the "Closing Date
Balance Sheet") and shall be delivered by the Company two business days prior to
the Closing Date. SCHEDULE 1.6(a) sets forth the allocation of the Aggregate
Cash Purchase Price among the Principal Stockholders, such Schedule having been
prepared in reliance upon the certificate of the President of the Company and
the Principal Stockholders delivered to Webhire pursuant to Section 5.1(l) of
this Agreement.
(b) STOCK CONSIDERATION. The aggregate number of shares of
Webhire common stock, par value $.01 per share ("Webhire Common Stock"),
issuable by Webhire to the stockholders of the Company for their Company Stock
shall be the product obtained by multiplying (a) the Number of Outstanding
Company Shares by (b) the Per Share Stock
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Payment (the "Webhire Stock"). The "Per Share Stock Payment" shall mean the
product obtained by multiplying (i) the Exchange Ratio by (ii) ninety percent
(90%). The "Exchange Ratio" shall be equal to the quotient obtained by dividing
(i) the Per Share Fully-Diluted Share Value by (ii) the Webhire Per Share Market
Value. For purposes of the forgoing, the "Webhire Per Share Market Value" shall
be the arithmetic average of the per share closing sales prices of Webhire
Common Stock as reported on the Nasdaq National Market ("NASDAQ") on the twenty
(20) trading days ending on and including the trading day which is two (2)
trading days immediately prior to the Closing Date. No fractional shares of
Webhire Common Stock shall be issued pursuant to this Agreement. In lieu of the
issuance of any fractional shares of Webhire Common Stock pursuant to this
Agreement, each holder of Company Stock shall be paid an amount in cash (without
interest), rounded to the nearest cent, determined by multiplying (i) the
Webhire Per Share Market Value by (ii) the fractional amount of a share of
Webhire Company Stock which such holder would otherwise be entitled to receive
under this Section 1.6(b) after aggregating all shares of Webhire Common Stock
into which the shares of Company Stock held by such holder shall be converted.
SCHEDULE 1.6(b) sets forth the allocation of the Webhire Common Stock among the
Principal Stockholders, such Schedule having been prepared in reliance upon the
certificate of the President of the Company and the Principal Stockholders
delivered to Webhire pursuant to Section 5.1(l) of this Agreement and the
certificate of the Chief Financial Officer of Webhire delivered to the Company
pursuant to Section 5.2(g) of this Agreement.
1.7 CONVERSION OF STOCK OPTIONS.
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(a) At the Effective Time, options to purchase an aggregate of
315,000 shares of Company Stock held by Xxxxxx immediately prior to the
Effective Time (the "Assumed Options") shall cease to represent a right to
acquire shares of Company Stock and shall be converted automatically into
options to acquire, under the same terms and conditions as were applicable to
such Assumed Options immediately prior to the Effective Time (e.g., among other
things, such Assumed Options shall be fully vested), shares of Webhire Common
Stock, and Webhire shall assume the Assumed Options and the option agreements
pursuant to which the Assumed Options were granted; PROVIDED, HOWEVER, that from
and after the Effective Time, (i) the number of shares of Webhire Common Stock
purchasable upon exercise of each Assumed Option shall be equal to the number of
shares of Company Stock that were purchasable under such Assumed Option
immediately prior to the Effective Time multiplied by the Exchange Ratio
rounding to the nearest whole share, (ii) the per share exercise price under
each such Assumed Option shall be adjusted by dividing the per share exercise
price of each such Assumed Option by the Exchange Ratio, rounding to the nearest
cent, (iii) Section 14 of the option agreements pursuant to which such Assumed
Options were granted, and all references thereto in the option agreements, shall
no longer apply to such Assumed Options, and (iv) Section 17 of the Company's
1998 Stock Option/Stock Issuance Plan shall no longer apply to such agreements.
The terms of each Assumed Option shall, in accordance with its terms, be subject
to further adjustment as appropriate to reflect any stock split, stock dividend,
recapitalization or other similar transaction with respect to Webhire Common
Stock on or subsequent to the Effective Time. Notwithstanding the foregoing, the
number of shares and the per share exercise price of each Assumed Option which
is intended to be an "incentive stock option" (as defined in Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code")) shall be adjusted in
accordance with the requirements of Section 424 of the Code. Accordingly, with
respect to any incentive stock options, fractional shares shall be rounded down
to the nearest whole number of shares and where necessary the per share exercise
price shall be rounded up to the nearest cent. SCHEDULE 1.7(A) sets forth the
aggregate number of shares of Webhire Common Stock purchasable upon exercise of
the Assumed Options as well as the exercise price per share.
(b) As soon as practicable after the Effective Time, Webhire
shall deliver to Xxxxxx an appropriate notice setting forth Xxxxxx'x rights
pursuant thereto, and such Assumed Options shall continue in effect on the same
terms and conditions except as provided in Section 1.7(a) hereof or as set forth
in such notice.
(c) At or prior to the Effective Time, Webhire shall reserve
for issuance the number of shares of Webhire Common Stock necessary to satisfy
Webhire's obligations under Section 1.7(a). At or prior to the Effective Time,
Webhire shall file with the Securities and Exchange Commission ("SEC") a
registration statement on Form S-8 (to the extent such form is available) under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the shares of Webhire Common Stock subject to Assumed Options assumed pursuant
to Section 1.7(a) hereof, and shall use its reasonable best efforts to maintain
the current status of
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the prospectus contained therein, as well as comply with any applicable state
securities or "blue sky" laws, for so long as such Assumed Options remain
outstanding.
1.8 CANCELLATION OF STOCK OPTIONS. Options to purchase an aggregate of
35,000 shares of Company Stock held by Xxxxxx immediately prior to the Effective
Time shall, immediately prior to the Effective Time, be canceled by the Company
(the "Canceled Options") and Xxxxxx shall be entitled to receive from Webhire,
on the Closing Date and in consideration of the cancellation of the Canceled
Options, cash consideration equal to the aggregate Per Share Fully-Diluted Share
Value of the Canceled Options less the aggregate per share exercise price of the
Canceled Options (the "Xxxxxx Option Payment"). The Company shall take all
actions necessary to ensure that all Canceled Options shall terminate and be
canceled as of the Effective Time and thereafter shall be of no further force or
effect. SCHEDULE 1.8 sets forth the aggregate cash consideration Xxxxxx is to
receive in consideration for the cancellation of her Canceled Options, such
Schedule having been prepared in reliance upon the certificate of the President
of the Company and the Principal Stockholders delivered to Webhire pursuant to
Section 5.1(l) of this Agreement.
1.9 PRINCIPAL STOCKHOLDER APPROVAL AND WAIVER. Each of the Principal
Stockholders agrees that his or her execution and delivery of this Agreement
shall constitute his or her vote for adoption of this Agreement in accordance
with, and his or her written waiver of any notice required by or appraisal
rights with respect to the transactions contemplated hereby arising under,
Delaware Law.
1.10 XXXXXX EXERCISE, TERMINATION AND SEVERANCE. Prior to the Closing,
Xxxxxx: (i) shall exercise all of his options to purchase Company Stock (the
"Xxxxxx Options") in accordance with their terms, and (ii) shall terminate his
employment and resign all of his offices with the Company and accept a
salary/bonus payment of $37,500 (which amount shall be paid by the Company prior
to the Closing) (the "Xxxxxx Salary/Bonus Payment") and a severance payment of
$45,000 (which amount shall be paid by Webhire on the Closing Date) (the "Xxxxxx
Xxxxxxxxx Payment") in satisfaction in full of the obligations of the Company to
him with respect to such employment.
1.11 XXXXXX EXERCISE. Prior to the Closing, Xxxxxx shall exercise
options to purchase 150,000 shares of Company Stock in accordance with their
terms and, after such exercise and prior to the option conversions and
cancellations referred to in Sections 1.7 and 1.8 hereof, Xxxxxx shall have
outstanding options to purchase an aggregate of 350,000 shares of Company Stock.
1.12 WITHHOLDING TAXES. All payments pursuant to this Agreement will be
net of applicable withholding taxes which are required to be paid, and the
parties hereto will cooperate in ensuring that the proper amounts are withheld
and paid over to the appropriate authorities and that all applicable forms which
Webhire reasonably determines need to be filed are so filed with the appropriate
authorities.
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1.13 ESCROW ARRANGEMENTS. Webhire shall place twenty-five percent (25%)
of the cash to be paid to the Principal Stockholders pursuant to Section 1.6(a),
allocated pro rata among the Principal Stockholders in proportion to the
relative cash proceeds each receives pursuant to Section 1.6(a) as set forth on
SCHEDULE 1.6(a), and twenty-five percent (25%) of the Xxxxxx Option Payment,
allocated entirely to Xxxxxx as set forth on SCHEDULE 1.8 (collectively, the
"Escrowed Cash"), in escrow pursuant to the terms of the Escrow Agreement, to be
dated as of the date of the Closing, substantially in the form attached as
EXHIBIT A hereto (the "Escrow Agreement"). Furthermore, pursuant to the Escrow
Agreement, Webhire shall place twenty-five percent (25%) of the shares of
Webhire Stock to be issued to the Principal Stockholders pursuant to Section
1.6(b) as set forth on SCHEDULE 1.6(b) and twenty-five percent (25%) of the
Assumed Options to purchase shares of Webhire Common Stocks to be received by
Xxxxxx pursuant to Section 1.7 as set forth on SCHEDULE 1.13, allocated pro rata
among the Principal Stockholders in proportion to the number of shares of
Webhire Stock and the number of Assumed Options each receives pursuant to
Sections 1.6(b) and 1.7, respectively (collectively, the "Escrowed Stock" and,
with the Escrowed Cash, the "Escrowed Amount") in escrow pursuant to the terms
of the Escrow Agreement. The Escrowed Amount shall serve as partial security for
the faithful performance of the indemnity obligations of the Principal
Stockholders to the Buyer Indemnified Parties (as defined in Section 7.1 below)
under Section 7 hereof and will be subject to transfer to the Buyer Indemnified
Parties in satisfaction of the indemnification obligations of the Principal
Stockholders as provided in this Agreement and the Escrow Agreement. Subject to
the terms of Section 7 of this Agreement and the terms of the Escrow Agreement,
the Escrowed Amount, less (a) any amount which shall be transferred to the Buyer
Indemnified Parties pursuant to the terms of this Agreement and the Escrow
Agreement and (b) any Reserved Amount (as defined in the Escrow Agreement),
shall be released to the Principal Stockholders on July 9, 2000.
1.14 RELEASE. Each Principal Stockholder releases and forever
discharges Webhire, Acquisition Corp and the Company, each of the present and
former shareholders, directors, officers, employees, agents, affiliates and
representatives of the foregoing and their respective successors and assigns
(each a "Released Party") of and from any and all commitments, covenants,
agreements, indebtedness, suits, demands, obligations and liabilities,
contingent or otherwise, of every kind and nature, whether known or unknown,
related to such Stockholder's relationship with the Company, including claims
(including but not limited to any claims which relate to or arise out of such
Principal Stockholder's prior relationship with the Company or stock ownership
in the Company or extension of credit to the Company) and causes of action both
at law and in equity, which such Stockholder and/or his heirs, executors,
administrators or assigns ever had, now has or, to the extent arising from or in
connection with any act, omission or state of facts taken or existing on or
prior to the Effective Time, may have after the date hereof, against any
Released Party, whether asserted, unasserted, absolute, contingent, known or
unknown, other than claims or causes of action arising from or related to this
Agreement or any agreement or instrument executed and delivered pursuant to
7
this Agreement. In addition, such Principal Stockholder (i) has not assigned any
claim or possible claim against any Released Party, (ii) has made an informed
and knowledgeable decision with regard to entering into this Agreement, fully
intends to be legally bound by the terms of this Agreement (including this
Section 1.14) and to release all claims against the Released Parties including,
without limitation, known, unknown and contingent claims, and (iii) has had an
opportunity to review this Section 1.14 with counsel and understands the
consequences hereof.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE
PRINCIPAL STOCKHOLDERS.
2.1 MAKING OF REPRESENTATIONS AND WARRANTIES. As a material inducement
to Webhire and the Acquisition Corp to enter into this Agreement and consummate
the transactions contemplated hereby, the Company and each of the Principal
Stockholders jointly and severally make to Webhire and the Acquisition Corp the
representations and warranties contained in this Section 2; provided, however,
that (i) no Principal Stockholder or other person or entity shall have any right
of indemnity or contribution from the Company or the Surviving Corporation with
respect to any breach of representation or warranty hereunder, (ii) the
warranties in Sections 2.3(b) and 2.5(b) are only made severally by each
Principal Stockholder with respect to his own Company Stock, options to purchase
Company Stock ("Company Options") and/or other securities of the Company, and
(iii) the representations and warranties are subject to the disclosure schedules
attached hereto, the section numbers of which shall correspond to the section
numbers of this Agreement. Whenever any representation or warranty is made to
the knowledge of the Company or to the best knowledge of the Company, such
knowledge means and is limited to the knowledge which is actually known or, in
the exercise of their respective responsibilities for the Company, reasonably
should have been known, by any of the Principal Stockholders.
2.2 ORGANIZATION AND QUALIFICATIONS OF THE COMPANY; RESIDENCE. The
Company is a corporation duly organized, validly existing and in good standing
under the laws of Delaware with full corporate power and authority to own or
lease its properties and to conduct its business in the manner and in the places
where such properties are owned or leased or such business is currently
conducted or proposed to be conducted. The copies of the Company's Certificate
of Incorporation as amended to date, certified by the Delaware Secretary of
State, and of the Company's By-laws as amended to date, certified by the
Company's Secretary, and heretofore delivered to Webhire's counsel, are complete
and correct, and no amendments thereto are pending. The Company is not in
violation of any term of its Certificate of Incorporation or By-laws. The
Company is not required to be licensed or qualified to conduct its business or
own its property in any jurisdiction other than Delaware or Massachusetts. None
of the Principal Stockholders is, or has been since the date such Stockholder
became a stockholder of the Company, and none of the former holders of the
Common Stock at the time
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they owned such Common Stock was, a nonresident alien (as referenced in Section
1361(b)(C) of the Code).
2.3 CAPITAL STOCK OF THE COMPANY; BENEFICIAL OWNERSHIP.
(a) The authorized capital stock of the Company consists of
5,000,000 shares of Company Stock, $.01 per share, of which 1,700,000 shares are
duly and validly issued, outstanding, fully paid and non-assessable and of which
3,300,000 shares are authorized but unissued. Except for options granted to
Xxxxxx to purchase up to 350,000 shares of Company Stock at an exercise price of
$.10 per share, there are no outstanding options, warrants, rights, commitments,
preemptive rights or agreements of any kind for the issuance or sale of, or
outstanding securities convertible into, any additional shares of capital stock
of any class of the Company. None of the Company's capital stock has been issued
in violation of any federal or state law. There are no voting trusts, voting
agreements, proxies or other agreements, instruments or undertakings with
respect to the voting of the Company Stock to which the Company or any of the
Principal Stockholders is a party.
(b) Each of the Principal Stockholders owns beneficially and
of record the number of shares of Company Stock and/or Company Options set forth
opposite such Principal Stockholder's name on SCHEDULE 2.3(b) hereto, free and
clear of any liens, restrictions, encumbrances or other adverse claims.
2.4 SUBSIDIARIES. The Company has no subsidiaries or investments in, or
loans to, any other corporation, business organization or entity.
2.5 AUTHORITY OF THE COMPANY AND THE PRINCIPAL STOCKHOLDERS.
(a) The Company has full right, authority and power to enter
into this Agreement and each agreement, document and instrument to be executed
and delivered by the Company pursuant to this Agreement and to carry out the
transactions contemplated hereby. The execution, delivery and performance by the
Company of this Agreement and each such other agreement, document and instrument
have been duly authorized by all necessary action of the Company and no other
action on the part of the Company or the Principal Stockholders is required in
connection therewith.
This Agreement and each agreement, document and instrument executed and
delivered by the Company pursuant to this Agreement constitutes, or when
executed and delivered will constitute, valid and binding obligations of the
Company enforceable in accordance with their terms. The execution, delivery and
performance by the Company of this Agreement and each such agreement, document
and instrument:
(i) do not and will not violate any provision of
the Certificate of Incorporation or By-laws of the Company;
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(ii) do not and will not violate any laws of the
United States, or any state or other jurisdiction applicable to the
Company or require the Company to obtain any approval, consent or
waiver of, or make any filing with, any person or entity (governmental
or otherwise) (including, without limitation, the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 0000 (xxx "XXX Xxx")) that has not been
obtained or made; and
(iii) do not and will not result in a breach of,
constitute a default under, require any consent under, accelerate any
obligation under, or give rise to a right of termination of any
indenture or loan or credit agreement or any other agreement, contract,
instrument, mortgage, lien, lease, permit, authorization, order, writ,
judgment, injunction, decree, determination or arbitration award to
which the Company is a party or by which the property of the Company is
bound or affected, or result in the creation or imposition of any
mortgage, pledge, lien, security interest or other charge or
encumbrance on any of the Company's assets or its Company Stock, except
as specifically identified on SCHEDULE 2.5(a).
(b) Each of the Principal Stockholders has full right,
authority, power and capacity to enter into this Agreement and each agreement,
document and instrument to be executed and delivered by or on behalf of him or
her pursuant to or contemplated by this Agreement and to carry out the
transactions contemplated hereby and thereby. This Agreement and each agreement,
document and instrument executed and delivered by each of the Principal
Stockholders pursuant to or contemplated by this Agreement constitute, or when
executed and delivered will constitute, valid and binding obligations of such
Principal Stockholder enforceable in accordance with their respective terms,
except as the same may be limited by bankruptcy, insolvency or reorganization
laws, or other laws relating to or affecting the availability of the remedy of
specific performance or equitable principles of general application. The
execution, delivery and performance by each of the Principal Stockholders of
this Agreement and each such agreement, document and instrument:
(i) do not and will not violate any laws of the
United States or any state or other jurisdiction applicable to such
Principal Stockholder or require such Principal Stockholder to obtain
any approval, consent or waiver of, or make any filing with, any person
or entity (governmental or otherwise) (including, without limitation,
the HSR Act) that has not been obtained or made; and
(ii) do not and will not result in a breach of,
constitute a default under, accelerate any obligation under or give
rise to a right of termination of any indenture or loan or credit
agreement or any other agreement, contract, instrument, mortgage, lien,
lease, permit, authorization, order, writ, judgment, injunction,
decree, determination or arbitration award to which such Principal
Stockholder is a party or by which the property of such Principal
Stockholder is bound or affected, or result in the
10
creation or imposition of any mortgage, pledge, lien, security
interest or other charge or encumbrance on any of the Company, its
Company Stock or the Company Options.
2.6 REAL AND PERSONAL PROPERTY.
(a) REAL PROPERTY. The Company does not own, and has never
owned, any real property. The Company does not currently lease any real
property, nor does the Company have any outstanding obligations with respect to
any previously leased real property.
(b) PERSONAL PROPERTY. A complete description of the personal
property of the Company is contained in SCHEDULE 2.6(b) hereto. Except as
specifically disclosed in said Schedule or in the Base Balance Sheet (as
hereinafter defined), the Company has good and marketable title to all of its
personal property. Except as specified on SCHEDULE 2.6(b): all such personal
property is in the custody and control of the Company; and all such personal
property is located at the Company's offices at the Leased Real Property. None
of such personal property or assets is subject to any mortgage, pledge, lien,
conditional sale agreement, security title, encumbrance or other charge except
as specifically disclosed in said Schedule or in the Base Balance Sheet other
than Permitted Encumbrances (as defined below). The Base Balance Sheet reflects
all personal property of the Company and such personal property is sufficient
for the Company to continue and carry on its business as presently conducted. To
the best knowledge of the Company and the Principal Stockholders, except as
otherwise specified in SCHEDULE 2.6(b) hereto, all leasehold improvements,
furnishings, machinery and equipment of the Company are in good repair, have
been well maintained, and substantially comply with all applicable laws,
ordinances and regulations, and such machinery and equipment is in good working
order. Neither the Company nor any of the Principal Stockholders knows of any
pending or threatened change of any such law, ordinance or regulation which
could adversely affect the Company or any of its business. For purposes hereof,
Permitted Encumbrances means any lien, mortgage, security interest or other
encumbrance that results from any of the following: (i) liens for taxes and
assessments not delinquent or actively being contested in good faith by the
Company; (ii) deposits or pledges for goods or services made in the ordinary
course of the Company's business; and (iii) customary liens in favor of
mechanics, materialmen and landlords which arise by operation of law and not by
the Company's agreement and which are incurred in the ordinary course of the
Company's business.
2.7 FINANCIAL STATEMENTS.
(a) The Company has delivered to Webhire the following
financial statements, copies of which are attached hereto as SCHEDULE 2.7:
(i) A balance sheet of the Company for its fiscal
year ended December 31, 1998 (the "Base Balance Sheet"), and statements
of operations, stockholder's equity and cash flows for the year then
ended; and
11
(ii) The Closing Date Balance Sheet certified by
the Company's President.
Said financial statements have been prepared in accordance with
generally accepted accounting principles ("GAAP") applied consistently during
the periods covered thereby, are complete and correct in all material respects
and present fairly in all material respects the financial condition of the
Company at the dates of said statements and the results of its operations for
the periods covered thereby.
(b) As of the date of the Base Balance Sheet, the Company had
no liabilities of any nature, whether accrued, absolute, contingent or
otherwise, asserted or unasserted, known or unknown (including without
limitation, liabilities as guarantor or otherwise with respect to obligations of
others, liabilities for Taxes (as defined in Section 2.8) due or then accrued or
to become due, or contingent or potential liabilities relating to activities of
the Company or the conduct of its business prior to the date of the Base Balance
Sheet regardless of whether claims in respect thereof had been asserted as of
such date) which, under generally accepted accounting principles, are required
to be reflected on the Base Balance Sheet, except liabilities stated or
adequately reserved against on the Base Balance Sheet or the notes thereto as
required by GAAP, or reflected in Schedules furnished to Webhire hereunder as of
the date hereof.
(c) As of the date hereof and as of the Closing, the Company
has not had and will not have any liabilities of any nature, whether accrued,
absolute, contingent or otherwise, asserted or unasserted, known or unknown
(including without limitation, liabilities as guarantor or otherwise with
respect to obligations of others, or liabilities for Taxes due or then accrued
or to become due or contingent or potential liabilities relating to activities
of the Company or the conduct of its business prior to the date hereof or the
Closing, as the case may be, regardless of whether claims in respect thereof had
been asserted as of such date), except liabilities (i) stated or adequately
reserved against on the Closing Date Balance Sheet or the notes thereto as
required by GAAP or (ii) reflected in Schedules furnished to Webhire hereunder
on the date hereof.
2.8 TAXES. The Company has timely and properly filed or received timely
and proper extensions for the filing of all declarations, reports, claims for
refund or information return or statement relating to any Taxes (as defined
below), including any schedule or attachment thereto or any amendment thereof
(collectively, "Tax Returns"), required to be filed by it, and all such Tax
Returns were correct and complete in all material respects. The Company has paid
all federal, state, local, and foreign: income, gross receipts, capital stock,
franchise, profits, windfall profits, withholding, payroll, social security (or
similar), unemployment, disability, real property, personal property, excise,
occupation, sales, use, transfer, value added, alternative minimum,
environmental, customs, duties, estimated or other tax, including any interest,
penalty or addition thereto and whether disputed or not
12
(collectively, "Taxes") owed by it (whether or not shown on any Tax Return),
except Taxes which have not yet accrued or otherwise become due. All Taxes
and other assessments and levies which the Company was or is required to
withhold or collect from customers, vendors, resellers, or employees have
been withheld and collected and have been paid over or will be paid over when
due to the proper government authorities. Except as set forth in SCHEDULE
2.8: (a) the Company has never received notice of any audit or of any
proposed deficiencies from the Internal Revenue Service ("IRS") or any other
taxing authority (other than routine audits undertaken in the ordinary course
and which have been resolved on or prior to the date hereof without material
adverse effect on the Company or its financial condition); (b) there are in
effect no waivers of applicable statutes of limitations or extensions of time
for the assessment or payment with respect to any Taxes owed by the Company
for any year; (c) neither the IRS nor any other taxing authority is now
asserting or, to the best knowledge of the Company, threatening to assert
against the Company any deficiency or claim for additional Taxes or interest
thereon or penalties in connection therewith in respect of the Company; and
(d) the Company has never been a member of an affiliated group of
corporations filing a combined federal income Tax Return, nor does the
Company have any liability for Taxes of any other Person under Treasury
Regulation Section 1.1502-6 (or any similar provision of foreign, state or
local law) or otherwise; and (e) the Company has never made an election under
Section 341(f) of the Code. No claim has ever been made by an authority in a
jurisdiction where the Company does not file reports and returns that the
Company is or may be subject to taxation by that jurisdiction. There are no
security interests on any of the assets of the Company or its Common Stock
that arose in connection with any failure (or alleged failure) to pay any
Taxes. The Company has never entered into a closing agreement pursuant to
Section 7121 of the Code. Except as set forth in SCHEDULE 2.8, no extension
of time with respect to any date on which a tax return was or is to be filed
by the Company is in force. None of the Principal Stockholders is a "foreign
person" within the meaning of Section 1445 of the Code or the regulations
promulgated thereunder. The Company is not a party to any Tax allocation or
sharing arrangement. The Company has, at all times since March 31, 1998,
qualified and currently qualifies as an entity properly taxable as an S
corporation (as defined in Section 1361 of the Code). The consummation of the
transactions contemplated by this Agreement will not give rise to any federal
or state income tax liability of the Company. For purposes of this Agreement,
all references to Sections of the Code shall include any predecessor
provisions to such Sections and any similar provisions of federal, state,
local or foreign law.
2.9 COLLECTIBILITY OF ACCOUNTS RECEIVABLE. All of the accounts
receivable of the Company shown or reflected on the Closing Date Balance Sheet
(less the reserve for returns set forth on the Closing Date Balance Sheet) will
be at the Closing valid and enforceable claims, fully collectible in the
ordinary course and subject to no set off or counterclaim, and all such accounts
receivables will represent valid accounts incurred in the ordinary course of
business consistent with past practice. The Company does not have any accounts
or loans receivable from any person, firm or corporation which is affiliated
with the Company or the Principal Stockholders or from any director, officer or
employee of the Company, except as
13
disclosed on SCHEDULE 2.9 hereto, and all accounts and loans receivable from any
such person, firm or corporation shall be paid in cash prior to the Closing.
2.10 ABSENCE OF CERTAIN CHANGES. Except as disclosed in SCHEDULE 2.10
attached hereto, since the date of the Base Balance Sheet there has not been:
(a) any change in the financial condition, properties, assets,
liabilities, business or operations of the Company, which change by itself or in
conjunction with all other such changes, whether or not arising in the ordinary
course of business, has been materially adverse with respect to the Company;
(b) any contingent liability incurred by the Company as
guarantor or otherwise with respect to the obligations of others or any
cancellation of any material debt or claim owing to, or waiver of any material
right of, the Company;
(c) any mortgage, encumbrance or lien placed on any of the
properties of the Company which remains in existence on the date hereof or will
remain on the Closing Date;
(d) any obligation or liability of any nature, whether
accrued, absolute, contingent or otherwise, asserted or unasserted, known or
unknown (including without limitation liabilities for Taxes due or to become due
or contingent or potential liabilities relating to products or services provided
by the Company or the conduct of the business of the Company since the date of
the Base Balance Sheet regardless of whether claims in respect thereof have been
asserted), incurred by the Company other than obligations and liabilities
incurred in the ordinary course of business consistent with the terms of this
Agreement;
(e) any purchase, sale or other disposition, or any agreement
or other arrangement for the purchase, sale or other disposition, of any of the
properties or assets of the Company other than in the ordinary course of
business;
(f) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties, assets or business
of the Company;
(g) any declaration, setting aside or payment of any dividend
by the Company, or the making of any other distribution in respect of the
capital stock of the Company, or any direct or indirect redemption, purchase or
other acquisition by the Company of its own capital stock;
(h) any labor trouble or claim of unfair labor practices
involving the Company; any change in the compensation payable or to become
payable by the Company to any of its officers, employees, agents or independent
contractors other than normal merit increases in accordance with its usual
practices; or any bonus payment or arrangement made to
14
or with any of such officers, employees, agents or independent contractors
except as contemplated by Section 1.10 hereof;
(i) any change or proposed change with respect to the officers
or management of the Company except as contemplated by Section 1.10 hereof;
(j) any payment or discharge of a material lien or liability
of the Company which was not shown on the Base Balance Sheet or incurred in the
ordinary course of business thereafter;
(k) any obligation or liability incurred by the Company to any
of its officers, directors, stockholders or employees, or any loans or advances
made by the Company to any of its officers, directors, stockholders or
employees, except normal compensation and expense allowances payable to officers
or employees and except as contemplated by Section 1.10 hereof;
(l) any change in accounting methods or practices, credit
practices or collection policies used by the Company;
(m) any other transaction entered into by the Company other
than transactions in the ordinary course of business and consistent with past
practice; or
(n) any agreement or understanding whether in writing or
otherwise, for the Company to take any of the actions specified in paragraphs
(a) through (m) above.
2.11 ORDINARY COURSE. Since the date of the Base Balance Sheet, the
Company has conducted its business only in the ordinary course and consistently
with its prior practices.
2.12 BANKING RELATIONS. All of the arrangements which the Company has
with any banking institution are completely and accurately described in SCHEDULE
2.12 attached hereto, indicating with respect to each of such arrangements the
type of arrangement maintained (such as checking account, borrowing
arrangements, safe deposit box, etc.) and the person or persons authorized in
respect thereof.
15
2.13 INTELLECTUAL PROPERTY.
(a) Except as described in SCHEDULE 2.13 and except for
"Off-the-Shelf Software" (as defined below), the Company has exclusive ownership
of, or exclusive license to use, all patent, copyright, trade secret, trademark,
or other proprietary rights (collectively, "Intellectual Property") used in the
business of the Company as presently conducted, or has obtained any licenses,
releases or assignments reasonably necessary to use all third parties'
Intellectual Property rights in works embodied in its Proprietary Products (as
defined in paragraph (g) below). Except as described in SCHEDULE 2.13, all of
the rights of the Company in such Intellectual Property are freely transferable.
There are no claims or demands of any other person pertaining to any of such
Intellectual Property and no proceedings have been instituted, or are pending
or, to the knowledge of the Company, threatened, which challenge the rights of
the Company in respect thereof except as disclosed in SCHEDULE 2.13. Except as
described in SCHEDULE 2.13, the Company has the right to use, free and clear of
claims or rights of other persons, all customer lists, designs, manufacturing or
other processes, computer software, systems, data compilations, research results
and other information required for or incident to its products or its business
as presently conducted or contemplated. For purposes of this Agreement, the term
"Off-the-Shelf Software" shall mean software utilized in the internal operations
of the Company which is generally commercially available to the public at
retail, provided, however, that such software is not used in the development of,
or embodied in (i.e., all or part of the code comprising such software is
included in any Proprietary Product), any of the Company's Proprietary Products.
(b) All patents, patent applications, trademarks, trademark
applications and registrations and registered copyrights which are owned by or
licensed to the Company or used or to be used by the Company in its business as
presently conducted, and all other items of Intellectual Property which are
material to the business or operations of the Company, are listed in SCHEDULE
2.13.
(c) All licenses or other agreements under which the Company
is granted rights in Intellectual Property, other than licenses of Off-the-Shelf
Software, are listed in SCHEDULE 2.13. All said licenses or other agreements are
in full force and effect, there is no material default by any party thereto, and
except as set forth on SCHEDULE 2.13, all of the rights of the Company
thereunder are freely assignable. To the knowledge of the Company and the
Principal Stockholders, the licensors under said licenses and other agreements
have and had all requisite power and authority to grant the rights purported to
be conferred thereby. Webhire has been provided access to true and complete
copies of all such licenses or other agreements, and any amendments thereto.
(d) All licenses or other agreements under which the Company
has granted rights to others in Intellectual Property owned or licensed by the
Company (other than standard shrink-wrapped user licenses) are listed in
SCHEDULE 2.13. All of said licenses or other agreements are in full force and
effect, there is no material default by any party thereto,
16
and, except as set forth on SCHEDULE 2.13, all of the rights of the Company
thereunder are freely assignable. Webhire has been provided with true and
complete copies of all such licenses or other agreements, and any amendments
thereto.
(e) The Company has taken all steps required in accordance
with sound business practice to establish and preserve its ownership of all
Intellectual Property rights with respect to its products, services and
technology. The Company has affixed appropriate copyright and trademark notices
on all of its products and any related documentation. The Company has required
all of its professional and technical employees, all other employees having
access to valuable non-public information of the Company, and all consultants
and independent contractors involved in the development of any of the
Intellectual Property to execute agreements under which such persons are
required to convey to the Company ownership of all inventions and developments
conceived or created by them in the course of their employment with the Company
or while they are providing services to the Company and to maintain the
confidentiality of all such information of the Company. The Company and the
Principal Stockholders have not made any such information available to any
person other than employees of Company except pursuant to written agreements
requiring the recipients to maintain the confidentiality of such information and
appropriately restricting the use thereof. The Company and the Principal
Stockholders have no knowledge of any infringement by others of any Intellectual
Property rights of the Company.
(f) The present business, activities and products of the
Company do not infringe any Intellectual Property of any other person. No
proceeding charging the Company with infringement of any adversely held
Intellectual Property has been filed or, to the knowledge of the Company, is
threatened to be filed. To the best knowledge of the Company and the Principal
Stockholders, there exists no unexpired patent or patent application which
includes claims that would be infringed by or otherwise adversely affect the
products, activities or business of the Company. The Company is not making
unauthorized use of any confidential information or trade secrets of any person,
including without limitation, any former employer of any past or present
employee, consultant or independent contractor of Company. Except as set forth
in SCHEDULE 2.13, neither the Company nor, to the knowledge of the Company and
the Principal Stockholders, any of the Company's employees, consultants or
independent contractors have any agreements or arrangements with any persons
other than the Company related to confidential information or trade secrets of
such persons or restricting any such person's ability to engage in business
activities of any nature. The activities of the Company's present and former
employees, consultants and independent contractors on behalf of the Company do
not violate any such agreements or arrangements known to the Company.
(g) SCHEDULE 2.13 sets forth a true and complete list of all
components of all computer software products which are proprietary to the
Company (the "Proprietary Products"), and each author of each component of the
Proprietary Products. Except as set forth in SCHEDULE 2.13, each author of each
component of the Proprietary Products has assigned ownership of all proprietary
rights in and to the Proprietary Products (including
17
without limitation rights of copyright, patent and trade secret) to the Company.
The Company has clear and exclusive title to the Proprietary Products and all
proprietary rights therein and there are no facts upon which any third party
could assert a valid claim of ownership with respect to any Proprietary
Products. Any and all third party software used in the creation of each
component of the Proprietary Products is listed in SCHEDULE 2.13 with reference
to the component in question, and was used in accordance with a duly granted
software license also listed in SCHEDULE 2.13. The Company's rights in the
Proprietary Products (including source code) constitute Intellectual Property
subject to all of the representations and warranties set forth in the foregoing
provisions of this Section 2.13. Except as set forth in SCHEDULE 2.13, the
software and designs of the Proprietary Products have been developed and
implemented in a professional manner and are documented in accordance with
normal professional standards so as to enable a qualified software engineer, to
maintain and modify the Proprietary Products conveniently and effectively on the
basis of such documentation. The Company has conducted a regular program of
maintaining and updating the Proprietary Products in response to defects, and
has in effect reliable procedures for version control with respect to the
Proprietary Products. Except as set forth on SCHEDULE 2.13, there are no
material software or design defects in any of the Proprietary Products and the
Proprietary Products conform in all material respects to the respective
specifications and documentation.
(h) Except as set forth on SCHEDULE 2.13, all computer
software products that are owned by the Company, exclusively licensed to the
Company, licensed, sold or otherwise distributed to others by the Company or are
otherwise required for the conduct of its business, except for Off-the-Shelf
Software products and third-party software products used in the development of
the Company's Proprietary Products, ("Software") are Year 2000 Compliant. As
used herein, "Year 2000 Compliant" shall mean the ability of the Software to
provide the following date related functions:
(i) consistently handle date information before,
during and after January 1, 2000, including but not limited to
accepting date input, providing date output and performing calculations
on dates or portions of dates;
(ii) function accurately in accordance with the
documentation relating to the applicable Software and without
interruption before, during and after January 1, 2000, without any
change in operations associated with the advent of the new century;
(iii) respond to two-digit date input in a way that
resolves any ambiguity as to the century in a disclosed, defined and
predetermined manner; and
(iv) store and provide output of date information in
ways that are unambiguous as to century.
2.14 CONTRACTS. Except for contracts, commitments, plans, agreements
and licenses described in SCHEDULE 2.14 or listed in another Schedule to this
Agreement (true and complete copies of which have been provided to Webhire), the
Company is not a party to or subject to:
18
(a) any plan or contract providing for bonuses, pensions,
options, stock purchases, deferred compensation, retirement payments, profit
sharing, collective bargaining or the like, or any contract or agreement with
any labor union;
(b) any employment contract or contract for services;
(c) any contract or agreement for the purchase of any
commodity, material or equipment;
(d) any contract or agreement for the sale or lease of
its products not made in the ordinary course of business;
(e) any contract with any sales agent or distributor of
products of the Company;
(f) any contract containing covenants limiting the
freedom of the Company to compete in any line of business or with any person or
entity;
(g) any contract or agreement for the purchase of any
fixed asset whether or not such purchase is in the ordinary course of business;
(h) any license agreement (as licensor or licensee),
other than licenses of Off-the-Shelf Software utilized in the internal
operations of the Company which are generally commercially available to the
public at retail;
(i) any indenture, mortgage, promissory note, loan
agreement, guaranty or other agreement or commitment for the borrowing of money;
or
(j) any contract or agreement with any officer, employee,
director or stockholder of the Company or with any persons or organizations
controlled by or affiliated with any of them; or
(k) any other contracts or agreements creating any
obligations of the Company, including, without limitation, any obligations to
provide maintenance or other services to any third party.
Except as set forth in SCHEDULE 2.14, all contracts, agreements, leases
and instruments to which the Company is a party or by which the Company is
obligated are valid and are in full force and effect and constitute legal, valid
and binding obligations of the Company and, to the best knowledge of the Company
and the Principal Stockholders, the other parties thereto, enforceable in
accordance with their respective terms. Except as set forth in SCHEDULE 2.14,
the Company is not in default under any such contracts, commitments, plans,
agreements or
19
licenses described in said Schedule nor has it any knowledge of conditions or
facts which with notice or passage of time, or both, would constitute a default.
2.15 LITIGATION. SCHEDULE 2.15 hereto lists all currently pending
litigation and governmental or administrative proceedings or investigations to
which the Company is a party. Except for matters described in SCHEDULE 2.15,
there is no litigation or governmental or administrative proceeding or
investigation pending or, to the knowledge of the Company and the Principal
Stockholders, threatened against the Company or its affiliates which could
reasonably be anticipated to have a material adverse effect on the properties,
assets, prospects, financial condition or business of the Company or which would
prevent or hinder the consummation of the transactions contemplated by this
Agreement. With respect to each matter set forth therein, SCHEDULE 2.15 sets
forth a description of the matter, the forum (if any) in which it is being
conducted, the parties thereto and the type and amount of relief sought.
2.16 COMPLIANCE WITH LAWS. Except as set forth in SCHEDULE 2.16 hereto,
the Company is in compliance with all applicable statutes, ordinances, orders,
judgements, decrees, rules and regulations promulgated by any federal, state,
municipal entity, agency, court or other governmental authority which apply to
the Company or to the conduct of its business, and neither the Company nor any
of the Principal Stockholders has received notice of a violation or alleged
violation of any such statute, ordinance, order, rule or regulation.
2.17 INSURANCE. The physical properties and assets of the Company are
insured to the extent disclosed in SCHEDULE 2.17 attached hereto and all such
insurance policies and arrangements are disclosed in said Schedule. SCHEDULE
2.17 also sets forth all of the Company's insurance policies covering product
liability. Said insurance policies and arrangements are in full force and
effect, all premiums with respect thereto are currently paid, and the Company is
in compliance with the terms thereof. Said insurance is sufficient for
compliance by the Company with all requirements of law and all agreements and
leases to which the Company is a party.
2.18 WARRANTY OR OTHER CLAIMS. There are no existing or, to the
knowledge of the Company, threatened product liability, warranty or other
similar claims, or any facts upon which a material claim of such nature could be
based, against the Company for products or services which are defective or fail
to meet any product or service warranties except as disclosed in SCHEDULE 2.18
hereto. There is no outstanding claim against the Company for renegotiation or
price redetermination of any business transaction, and there are no facts upon
which any such claim could be based.
2.19 POWERS OF ATTORNEY. Neither the Company nor any of the Principal
Stockholders has any outstanding power of attorney relating to the business of
the Company, except for the powers of attorney set forth in the Company's form
of Incentive Stock Option Agreement and form of Invention Confidentiality and
Noncompete Agreement.
20
2.20 FINDER'S FEE. Neither the Company nor any of the Principal
Stockholders has incurred or become liable for any broker's commission or
finder's fee relating to or in connection with the transactions contemplated by
this Agreement.
2.21 PERMITS; BURDENSOME AGREEMENTS. SCHEDULE 2.21 lists all permits,
registrations, licenses, franchises, certifications and other approvals other
than qualifications to transact business as a foreign corporation (collectively,
the "Approvals") required from federal, state or local authorities in order for
the Company to conduct its business. The Company has obtained all such
Approvals, which are valid and in full force and effect, and is operating in
compliance therewith. Such Approvals include, but are not limited to, those
required under federal, state or local statutes, ordinances, orders,
requirements, rules, regulations, or laws pertaining to environmental
protection, public health and safety, worker health and safety, buildings,
highways or zoning. Except as disclosed in SCHEDULE 2.21, the Company is not
subject to or bound by any judgment, decree or order which may materially and
adversely affect its business or prospects, its condition, financial or
otherwise, or any of its assets or properties.
2.22 CORPORATE RECORDS; COPIES OF DOCUMENTS. The corporate record books
of the Company accurately record all corporate action taken by its stockholders
and board of directors and committees. The copies of the corporate records of
the Company, as provided to Webhire for review, are true and complete copies of
the originals of such documents. The Company has made available for inspection
and copying by Webhire and its counsel true and correct copies of all documents
referred to in this Section or in the Schedules delivered to Webhire pursuant to
this Agreement.
2.23 TRANSACTIONS WITH INTERESTED PERSONS. Except as set forth in
SCHEDULE 2.23 hereto, none of the Company, the Principal Stockholders, or any
officer or director of the Company or any of their respective spouses or family
members, owns directly or indirectly on an individual or joint basis any
material interest in, or serves as an officer or director or in another similar
capacity of, any competitor or supplier of Company, or any organization which
has a material contract or arrangement with the Company.
21
2.24 EMPLOYEE BENEFIT PROGRAMS. Except as set forth in SCHEDULE 2.24,
the Company does not maintain and has never maintained an employee benefit plan
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). The Company has no liabilities or obligations
under ERISA. Except as set forth in SCHEDULE 2.24, the Company has no other
stock option plans, bonus or incentive award plans, severance pay policies or
agreements, deferred compensation agreements, supplemental income arrangements,
vacation plans, or other employee benefit plans, agreements, or arrangements.
True and correct copies of all plans and arrangements set forth on SCHEDULE 2.24
have been provided to Webhire. For purposes of the Section 2.24, an entity
"maintains" an employee benefit plan if such entity sponsors, contributes to, or
provides (or has promised to provide) benefits under such employee benefit plan,
or has any obligation (by agreement or under applicable law) to contribute to or
provide benefits under such employee benefit plan, or if such employee program
provides benefits to or otherwise covers employees of such entity, or their
spouses, dependents or beneficiaries.
2.25 ENVIRONMENTAL MATTERS. No Hazardous Materials (as hereinafter
defined) have been generated, transported, used, disposed, stored or treated by
the Company and, to the knowledge of the Company, no Hazardous Materials have
been released, discharged, disposed, placed or otherwise caused to enter the
soil or water within any real property owned, leased or operated by the Company.
Except as set forth in SCHEDULE 2.25 attached hereto, to the Company's
knowledge, no site owned, operated or leased by the Company contains any
asbestos or asbestos-containing material, any polychlorinated biphenyls (PCBs)
or equipment containing PCBs, or any urea formaldehyde foam insulation. For
purposes of this Section 2.25, (i) "Hazardous Material" shall mean and include
any hazardous waste, hazardous material, hazardous substance, petroleum product,
oil, toxic substance, pollutant, contaminant, or other substance which may pose
a threat to the environment or to human health or safety, as defined or
regulated under any Environmental Law; (ii) "Environmental Law" shall mean any
environmental or health and safety-related law, regulation, rule, ordinance, or
by-law at the foreign, federal, state, or local level, whether existing as of
the date hereof, previously enforced, or subsequently enacted; and (iii)
"Company" shall mean and include the Company and all other entities for whose
conduct the Company is or may be held responsible under any Environmental Law.
2.26 LIST OF DIRECTORS AND OFFICERS. SCHEDULE 2.26 hereto contains a
true and complete list of all current directors and officers of the Company. In
addition, SCHEDULE 2.26 hereto contains a list of all managers, employees,
consultants and independent contractors of the Company and the aggregate
compensation they have received from the Company as of the date hereof. In each
case, such Schedule also includes the current job title and aggregate
anticipated annual compensation of each such individual.
2.27 DISCLOSURE. The representations and warranties of the Company and
the Principal Stockholders contained in this Agreement and in the certificates,
exhibits and schedules delivered by the Company and the Principal Stockholders
pursuant to this
22
Agreement to Webhire and/or the Acquisition Corp do not contain any untrue
statement of a material fact, and, when taken together, do not omit to state a
material fact required to be stated therein or necessary in order to make such
representations or warranties not misleading in light of the circumstances under
which they were made. There are no facts actually known to the Company or any of
the Principal Stockholders which presently can reasonably be anticipated in the
future to have a material adverse affect on the business, properties, prospects,
operations or condition of the Company which have not been specifically
disclosed herein or in a Schedule furnished herewith, other than general
economic conditions affecting the industry in which the Company operates.
2.28 EMPLOYEES; LABOR MATTERS. The Company employs a total of three (3)
full-time employees and no part-time employees. Except as disclosed in SCHEDULE
2.28, the Company is not delinquent in payments to any of its employees for any
wages, salaries, commissions, bonuses or other direct compensation for any
services performed for it to the date hereof or for amounts required to be
reimbursed to such employees. Upon termination of the employment of any of said
employees at or prior to the Closing, none of the Company, the Surviving
Corporation, the Acquisition Corp or Webhire will, by reason of the transactions
contemplated under this Agreement or anything done prior to the Closing, be
liable to any of said employees for so-called "severance pay" or any other
payments, except as contemplated by Section 1.10 hereto. The Company has no
policy, practice, plan or program of paying severance pay or any form of
severance compensation in connection with the termination of employment. Except
as disclosed in SCHEDULE 2.28, the Company is in compliance in all material
respects with all applicable laws and regulations respecting labor, employment,
fair employment practices, work place safety and health, terms and conditions of
employment, and wages and hours. There are no charges of employment
discrimination or unfair labor practices existing, pending or, to the knowledge
of the Company, threatened against or involving the Company. No question
concerning representation exists with respect to any employees of the Company.
There are no grievances, complaints or charges that have been filed against the
Company under any dispute resolution procedure (including, but not limited to,
any proceedings under any dispute resolution procedure under any collective
bargaining agreement) that might have an adverse effect on the Company or the
conduct of its business, and there is no arbitration or similar proceeding
pending and no claim therefor has been asserted. No collective bargaining
agreement is in effect or is currently being or is about to be negotiated by the
Company. The Company has not received any information indicating that any of its
employment policies or practices is currently being audited or investigated by
any federal, state or local government agency.
2.29 CUSTOMERS AND DISTRIBUTORS. SCHEDULE 2.29 sets forth each
customer, sales representative or distributor (whether pursuant to a commission,
royalty or other arrangement) which accounted for more than 5% of the sales of
the Company for the twelve months ended May 31, 1999.
23
SECTION 3. INVESTMENT REPRESENTATIONS AND WARRANTIES OF THE PRINCIPAL
STOCKHOLDERS.
As a material inducement to Webhire and the Acquisition Corp to enter
into this Agreement and consummate the transactions contemplated hereby, each of
the Principal Stockholders hereby makes to Webhire and the Acquisition Corp
individually, and not jointly, each of the representations and warranties set
forth in this Section 3. The Principal Stockholders shall have no right of
indemnity or contribution from the Company with respect to the breach of any
representation or warranty under this Section 3.
Each Principal Stockholder hereby represents and warrants individually,
and not jointly, to Webhire and Acquisition Corp that with respect to his
receipt of Webhire Stock hereunder:
Such Principal Stockholder is acquiring the Webhire Stock for his or
her own account, for investment, and not with a view to any "distribution"
thereof within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"). The jurisdiction of residence of such Principal Stockholder
is The Commonwealth of Massachusetts and the offer and sale of the Webhire Stock
to such Principal Stockholder will take place in such jurisdiction. Such
Principal Stockholder has received and reviewed copies of the SEC Disclosure
Documents (as defined in Section 4.5 hereof). In addition, such Principal
Stockholder is knowledgeable and experienced in the making of investments of the
type involved in the acquisition of the Webhire Stock pursuant to this
Agreement, is able to bear the economic risk of loss of its investment in
Webhire, has been granted the opportunity to investigate the affairs of Webhire
and to ask questions of its officers and employees, and has availed itself of
such opportunity either directly or through its authorized representative.
Such Principal Stockholder understands that because the Webhire Stock
has not been registered under the Securities Act or securities or "blue sky"
laws of any jurisdiction, such Principal Stockholder cannot dispose of any or
all of the shares of the Webhire Stock unless such shares of Webhire Stock are
subsequently registered under the Securities Act or exemptions from such
registration are available. Such Principal Stockholder acknowledges and
understands that, except as provided in the Registration Rights Agreement (as
defined in Section 5.1(j) hereto), it has no independent right to require
Webhire to register the Webhire Stock. Such Principal Stockholder is aware that
Webhire may not accomplish a public offering of the Webhire Stock. Such
Principal Stockholder further understands that Webhire may, as a condition to
the transfer of any of the Webhire Stock, require that the request for transfer
by accompanied by an opinion of counsel as described below. Such Principal
Stockholder understands that each certificate representing the Webhire Stock
will bear a legend in substantially the form provided below (in addition to any
legend required under applicable state securities laws).
24
THE SHARES REPRESENTED HEREBY HAVE BEEN ACQUIRED BY THE HOLDER
NAMED HEREON FOR HIS OWN ACCOUNT FOR INVESTMENT; AND SUCH
SECURITIES MAY NOT BE PLEDGED, SOLD OR IN ANY OTHER WAY
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF
1933, AS IN EFFECT AT THAT TIME, OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF WEBHIRE AND ACQUISITION CORP.
4.1 MAKING OF REPRESENTATIONS AND WARRANTIES. As a material inducement
to the Company and the Principal Stockholders to enter into this Agreement and
consummate the transactions contemplated hereby, each of Webhire and the
Acquisition Corp, jointly and severally, hereby makes the representations and
warranties to the Company and the Principal Stockholders contained in this
Section 4.
4.2 ORGANIZATION. Each of Webhire and the Acquisition Corp is a
corporation duly organized, validly existing and in good standing under the laws
of Delaware with full corporate power to own or lease its properties and to
conduct its business in the manner and in the places where such properties are
owned or leased or such business is conducted by it.
4.3 CAPITAL STOCK OF WEBHIRE.
(ai The authorized capital stock of Webhire consists of (i)
30,000,000 shares of common stock, $.01 per share, of which 10,089,477 shares
were duly and validly issued, outstanding, fully paid and non-assessable as of
June 25, 1999; and (ii) 5,000,000 shares of preferred stock, $.01 per share, of
which no shares are issued and outstanding. Except for options to purchase up to
1,367,516 shares of Webhire Common Stock which were granted under Webhire's 1994
Stock Option Plan and its 1996 Stock Option and Grant Plan and remain
outstanding and unexercised as of June 25, 1999 and a Warrant to purchase up to
114,659 shares of Webhire Common Stock, there are no outstanding options,
warrants, rights, commitments, preemptive rights or agreements of any kind for
the issuance or sale of, or outstanding securities convertible into, any
additional shares of capital stock of any class of Webhire, except as disclosed
in SCHEDULE 4.3 attached hereto. None of Webhire's capital stock has been issued
in violation of any federal or state law.
25
4.4 AUTHORITY. Each of Webhire and the Acquisition Corp has full right,
authority and power to enter into this Agreement and each agreement, document
and instrument to be executed and delivered by it pursuant to this Agreement and
to carry out the transactions contemplated hereby. The execution, delivery and
performance by Webhire and the Acquisition Corp of this Agreement and each such
other agreement, document and instrument have been duly authorized by all
necessary corporate action and no other action on its part is required in
connection therewith.
This Agreement and each other agreement, document and instrument
executed and delivered by each of Webhire and the Acquisition Corp pursuant to
this Agreement constitute, or when executed and delivered will constitute, valid
and binding obligations of Webhire and Acquisition Corp enforceable in
accordance with their terms. The execution, delivery and performance by each of
Webhire and the Acquisition Corp of this Agreement and each such agreement,
document and instrument:
(i0 do not and will not violate any provision of
the Certificate of Incorporation or By-laws of Webhire or the
Acquisition Corp;
(ii0 do not and will not violate any laws of the
United States, or any state or other jurisdiction applicable to Webhire
or the Acquisition Corp or require the Company to obtain any approval,
consent or waiver of, or make any filing with, any person or entity
(governmental or otherwise) (including, without limitation, the HSR
Act) that has not been obtained or made; and
(iii0 do not and will not result in a breach of,
constitute a default under, accelerate any obligation under, or give
rise to a right of termination of any indenture or loan or credit
agreement or any other agreement, contract, instrument, mortgage, lien,
lease, permit, authorization, order, writ, judgment, injunction,
decree, determination or arbitration award to which Webhire or the
Acquisition Corp is a party or by which the property of Webhire of the
Acquisition Corp is bound or affected, or result in the creation or
imposition of any mortgage, pledge, lien, security interest or other
charge or encumbrance on any of their assets or common stock.
4.5 SEC REPORTS. Webhire's Annual Report on Form 10-K for the period
ended September 30, 1998 (the "Form 10-K") and all other forms, reports and
documents filed with the Securities and Exchange Commission (the "SEC") since
the filing of such Form 10-K (collectively, the "SEC Reports") have been
prepared in accordance with the applicable requirements of the Securities Act
and the Securities Exchange Act of 1934, as amended. The balance sheets
(including the related notes) included in the SEC Reports are complete and
correct in all material respects and fairly present the financial position of
Webhire as of the respective dates thereof, and the other related statements
(including the related notes) included therein and complete and correct in all
material respects fairly present the results of operations and cash flows of
Webhire for the respective fiscal periods set forth therein in accordance with
26
GAAP applied on a consistent basis, except in the case of interim financial
statements for normal recurring and certain non-recurring audit adjustments
necessary for a fair presentation of the financial position and operating
results of Webhire for the interim periods which will not be materially adverse
and for the omission of footnotes to said interim financial statements that
would be required by GAAP. Copies of the Form 10-K, Webhire's Quarterly Reports
on Form 10-Q for the quarters ended December 31, 1998 and March 31, 1999 and
Webhire's 1998 Annual Report to Stockholders have been provided to each of the
Principal Stockholders (the "SEC Disclosure Documents"). Except as set forth on
SCHEDULE 4.5, since March 31, 1999, the business of Webhire has been conducted
in the ordinary course and consistent with past practice. Since March 31, 1999,
there has been no change, event or effect that is, or is reasonably expected to
be, materially adverse to the business, operation, assets, liabilities,
financial condition or results of operations of Webhire.
4.6 FINDER'S FEE. No person is entitled to the payment of any broker's
commission or finder's fee relating to or in connection with the transactions
contemplated by this Agreement as the result of any actions taken by Webhire or
Acquisition Corp.
4.7 DISCLOSURE. The representations and warranties of Webhire and the
Acquisition Corp contained in this Agreement and in the certificates, exhibits
and schedules delivered by Webhire and the Acquisition Corp pursuant to this
Agreement to the Company and the Principal Stockholders do not contain any
untrue statement of a material fact, and, when taken together, do not omit to
state a material fact required to be stated therein or necessary in order to
make such representations or warranties not misleading in light of the
circumstances under which they were made.
4.8 TAX-FREE REORGANIZATION. Neither Webhire nor any of its
subsidiaries has taken or will take any action which has caused or will cause
the Merger to fail to qualify as a tax-free reorganization under the provisions
of Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code. Neither Webhire nor any
of its subsidiaries has failed to take or will fail to take any action which
would have caused or will cause the Merger to fail to qualify as a tax-free
reorganization under Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code.
SECTION 5. CONDITIONS.
5.1 CONDITIONS TO THE OBLIGATIONS OF WEBHIRE AND THE ACQUISITION CORP.
The obligations of Webhire and the Acquisition Corp to consummate this Agreement
and the transactions contemplated hereby are subject to the fulfillment, prior
to or at the Closing, of the following conditions precedent:
(a REPRESENTATIONS; WARRANTIES; COVENANTS. Each of the
representations and warranties of the Company and the Principal Stockholders
contained in Sections 2 and 3 shall be true and correct in all material respects
as of the date of this Agreement and as of the
27
date of the Closing as though made on and as of the Closing; and the Company and
each of the Principal Stockholders shall, on or before the Closing, have
performed all of their obligations hereunder which by the terms hereof are to be
performed on or before the Closing.
(b NO MATERIAL CHANGE. There shall have been no material
adverse change in the financial condition, prospects, properties, assets,
liabilities, business or operations of the Company since the date of the Base
Balance Sheet, whether or not in the ordinary course of business.
(c CERTIFICATE REGARDING REPRESENTATIONS, WARRANTIES,
COVENANTS AND CHANGES. The Company shall have delivered to Webhire a certificate
of the Company's President and the Principal Stockholders dated as of the
Closing to the effect that the statements set forth in paragraph (a) and (b)
above in this Section 5.1 are true and correct.
(d APPROVAL OF WEBHIRE'S COUNSEL. All actions, proceedings,
instruments and documents required to carry out this Agreement and the
transactions contemplated hereby and all related legal matters contemplated by
this Agreement shall have been approved by Xxxxxxx, Procter & Xxxx LLP, counsel
for Webhire, and such counsel shall have received on behalf of Webhire such
other certificates, opinions, and documents in form satisfactory to such
counsel, as Webhire may reasonably require from the Company and the Principal
Stockholders to evidence compliance with the terms and conditions hereof as of
the Closing and the correctness as of the Closing of the representations and
warranties of the Principal Stockholders and the Company and the fulfillment of
their respective covenants.
(e OPINION OF COUNSEL. On the Closing Date, Webhire shall
have received from Xxxxxx, Gesmer & Xxxxxxxxx, LLP, counsel for the Company and
the Principal Stockholders, its opinion as of said date, in the form attached as
EXHIBIT B hereto.
(f NO LITIGATION. There shall have been no determination by
Webhire, acting in good faith, that the consummation of the transactions
contemplated by this Agreement has become inadvisable or impracticable by reason
of the institution or threat by any person or any federal, state or other
governmental authority of litigation, proceedings or other action against
Webhire, the Acquisition Corp, the Company or any of the Principal Stockholders
or any material adverse change in the laws or regulations applicable to the
Company.
(g CONSENTS. The Company and the Principal Stockholders shall
have made all filings with and notifications of governmental authorities,
regulatory agencies and other persons and entities required to be made by them
in connection with the execution and delivery of this Agreement, the performance
of the transactions contemplated hereby and the continued operation of the
business of the Company subsequent to the Closing; and the Company and the
Principal Stockholders shall have received all authorizations, waivers, consents
and permits, in form and substance reasonably satisfactory to Webhire, from all
third parties, including,
28
without limitation, applicable governmental authorities, regulatory agencies,
lessors, lenders and contract parties, required to permit the continuation of
the business of the Company and the consummation of the transactions
contemplated by this Agreement, and to avoid a breach, default, termination,
acceleration or modification of any material indenture, loan or credit agreement
or any other material agreement, contract, instrument, mortgage, lien, lease,
permit, authorization, order, writ, judgment, injunction, decree, determination
or arbitration award as a result of, or in connection with, the execution and
performance of this Agreement.
(h EMPLOYMENT ARRANGEMENTS. Webhire or the Surviving
Corporation shall have entered into an Employment Agreement with each of
Xxxxxxxx and Xxxxxx in substantially the form of EXHIBIT C attached hereto. The
Company shall have provided written evidence to Webhire that all employees of
the Company shall have terminated any existing employment agreements with the
Company, and the Company shall have terminated the employment of Xxxxxx. The
Company shall have paid to its employees all bonus amounts or other compensation
for which the Company shall be obligated at the Closing other than the Xxxxxx
Xxxxxxxxx Payment.
(i S CORPORATION. Webhire shall be satisfied, in its sole
discretion, with the evidence provided by the Company regarding the Company's
status as an entity properly taxable as an S corporation.
(j REGISTRATION RIGHTS AGREEMENT. Each Principal
Stockholder shall have executed and delivered to Webhire a Registration Rights
Agreement in substantially the form of EXHIBIT D attached hereto (the
"Registration Rights Agreement").
(k ESCROW AGREEMENT. The Escrow Agreement shall have
been executed by the parties thereto.
(l CERTIFICATE REGARDING CERTAIN DEFINITIONS. The Company
shall have delivered to Webhire a certificate of the Company's President and the
Principal Stockholders, dated as of the Closing, certifying as to the amount
attributable to certain terms defined in Section 1.6(a) hereto, such certificate
to be substantially in the form of EXHIBIT E attached hereto.
(m OPTION EXERCISES. Xxxxxx shall have exercised all of his
Company Options pursuant to their terms and Xxxxxx shall have executed Options
to purchase 150,000 shares of Company Stock pursuant to their terms.
(n RESIGNATIONS. The Company shall have delivered to
Webhire the resignations of all of the Directors and officers of the Company,
such resignations to be effective at the Closing.
29
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY AND THE PRINCIPAL
STOCKHOLDERS. The obligation of the Company and the Principal Stockholders to
consummate this Agreement and the transactions contemplated hereby is subject to
the fulfillment, prior to or at the Closing, of the following conditions
precedent:
(a REPRESENTATIONS; WARRANTIES; COVENANTS. Each of the
representations and warranties of Webhire and Acquisition Corp contained in
Section 4 shall be true and correct in all material respects as though made on
and as of the Closing; Webhire and Acquisition Corp shall, on or before the
Closing, have performed all of their respective obligations hereunder which by
the terms hereof are to be performed on or before the Closing; and Webhire shall
have delivered to the Company and the Principal Stockholders a certificate of
the President of Webhire dated on the Closing to such effect.
(b APPROVAL OF THE COMPANY'S COUNSEL. All actions,
proceedings, instruments and documents required to carry out this Agreement and
the transactions contemplated hereby and all related legal matters contemplated
by this agreement shall have been approved by Xxxxxx, Gesmer & Xxxxxxxxx, LLP as
counsel for the Company and the Principal Stockholders, and such counsel shall
have received on behalf of the Company and the Principal Stockholders such other
certificates, opinions and documents in form satisfactory to such counsel as the
Company may reasonably require from Webhire to evidence compliance with the
terms and conditions hereof as of the Closing and the correctness as of the
Closing of the representations and warranties of Webhire and the fulfillment of
its covenants.
(c NO LITIGATION. There shall have been no determination by
the Company, acting in good faith, that the consummation of the transactions
contemplated by this Agreement has become inadvisable or impracticable by reason
of the institution or threat by any person or any federal, state or other
governmental authority of material litigation, proceedings or other action
against Webhire, the Acquisition Corp, the Company or any Principal Stockholder.
(d OPINION OF COUNSEL. On the Closing Date, the Company and
the Principal Stockholders shall have received from Xxxxxxx, Procter & Xxxx LLP
counsel for Webhire and Acquisition Corp, an opinion as of said date, in
substantially the form attached hereto as EXHIBIT F.
(e EMPLOYMENT ARRANGEMENTS. Webhire or the Surviving
Corporation shall have entered into an Employment Agreement with each of
Xxxxxxxx and Xxxxxx in substantially the form of EXHIBIT C attached hereto.
(f REGISTRATION RIGHTS AGREEMENT. Webhire shall have
executed and delivered to the Principal Stockholders a Registration Rights
Agreement in substantially the form of EXHIBIT D attached hereto.
30
(g CERTIFICATE REGARDING WEBHIRE PER SHARE MARKET VALUE.
Webhire shall have delivered to the Company a certificate of Webhire's Chief
Financial Officer, dated as of the Closing, certifying as to the Webhire Per
Share Market Value, as defined in Section 1.6(b) hereto, such certificate to be
substantially in the form of EXHIBIT G attached hereto.
(i CONSENTS. Webhire and the Acquisition Corp, shall have
made all filings with and notifications of governmental authorities, regulatory
agencies and other persons and entities required to be made by them in
connection with the execution and delivery of this Agreement and the performance
of the transactions contemplated hereby, and all permits, approvals and other
authorizations required from such governmental entities and other persons
required to permit the consummation of the transactions contemplated by this
Agreement shall have been received.
SECTION 6. RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING.
6.1 SURVIVAL OF REPRESENTATIONS, ETC. Each of the representations,
warranties, agreements, covenants and obligations herein or in any schedule,
exhibit, certificate or financial statement delivered by any party to the other
party incident to the transactions contemplated hereby are material, shall be
deemed to have been relied upon by the other party and shall survive the Closing
regardless of any investigation and shall not merge in the performance of any
obligation by either party hereto; PROVIDED, HOWEVER, that such representations
and warranties shall expire on the same dates as and to the extent that the
rights to indemnification with respect thereto under Section 7 shall expire.
6.2 XXXXXX XXXXXXXXX PAYMENT. Webhire will pay to Xxxxxx the Xxxxxx
Xxxxxxxxx Payment upon termination of his employment with the Company at the
Effective Time.
6.3 OPTION CANCELLATION PAYMENTS. Webhire will pay to Xxxxxx the
Xxxxxx Option Payment at the
Effective Time.
6.4 CONFIDENTIALITY; TRADING IN WEBHIRE STOCK. The Principal
Stockholders acknowledge and agree that during the negotiation of this
Agreement, the Principal Stockholders received confidential, inside and
proprietary information concerning Webhire. Each of the Principal Stockholders
agrees that it and its representatives will hold in strict confidence and will
not use any confidential, inside or proprietary information it obtained with
respect to the business or financial condition of Webhire. In addition, in light
of the fact that the Principal Stockholders have received inside information
concerning Webhire during the negotiations of this Agreement, each agrees not to
trade, directly or indirectly, in Webhire Common Stock until Webhire determines
in good faith that such trading would not violate Section 10(b) of the
Securities and Exchange Act of 1934, as amended, or Rule 10b-5 promulgated
thereunder.
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SECTION 7. INDEMNIFICATION.
7.1 INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDERS. The Principal
Stockholders jointly and severally agree subsequent to the Closing to indemnify
and hold the Company, the Surviving Corporation, Acquisition Corp and Webhire
and their respective subsidiaries and affiliates and persons serving as
officers, directors, partners or employees thereof (individually a "Buyer
Indemnified Party" and collectively the "Buyer Indemnified Parties") harmless
from and against any damages, liabilities, losses, taxes, fines, penalties,
costs, and expenses (including, without limitation, reasonable fees of counsel)
of any kind or nature whatsoever (whether or not arising out of third-party
claims and including all amounts paid in investigation, defense or settlement of
the foregoing) which may be sustained or suffered by any of them arising out of
or based upon any of the following matters:
(a fraud, intentional misrepresentation or a deliberate or
wilful breach by the Company or any Principal Stockholder of any of their
representations, warranties or covenants under this Agreement or in any
certificate, schedule or exhibit delivered pursuant hereto or a breach of any
representation or warranty contained in Section 2.3 or Section 2.13 hereof;
(b except as provided in Section 7.1(a) above, any breach of
any representation, warranty or covenant of the Company or any Principal
Stockholder under this Agreement or in any certificate, schedule or exhibit
delivered pursuant hereto, or by reason of any claim, action or proceeding
asserted or instituted growing out of any matter or thing constituting a breach
of such representations, warranties or covenants;
(c any liability of the Company for Taxes arising from an
event or transaction prior to the Closing or as a result of the Closing which
have not been paid or provided for or reserved against by the Company, including
without limitation, any increase in Taxes due to the unavailability of any loss
or deduction claimed by the Company.
7.2 LIMITATIONS ON INDEMNIFICATION BY THE PRINCIPAL STOCKHOLDER.
Notwithstanding the foregoing, the right of Buyer Indemnified Parties to
indemnification under Section 7.1 shall be subject to the following provisions:
(a No indemnification shall be payable to a Buyer Indemnified
Party with respect to claims asserted pursuant to Section 7.1(b) after July 9,
2000;
(b No indemnification shall be payable to a Buyer Indemnified
Party with respect to claims asserted pursuant to Section 7.1(a) or (c) after
July 9, 2002.
(c No indemnification shall be payable pursuant to Sections
7.1(b) and 7.1(c) above to any Buyer Indemnified Party, except to the extent the
total of all claims for
32
indemnification pursuant to Sections 7.1(b) and (c) shall exceed $10,000 in the
aggregate, whereupon the full amount of such claims, up to an aggregate amount
of $1,997,500, shall be recoverable subject to, and in accordance with, the
terms hereof;
(di Notwithstanding any other provision of this Agreement, in
no event shall the aggregate indemnity obligations of the Principal Stockholders
pursuant to this Section 7 exceed $1,997,500;
(ei To the extent all or any portion of the Escrow Amount
continues to be held in escrow pursuant to the terms of the Escrow Agreement,
the Buyer Indemnified Parties shall be required to seek indemnification or
reimbursement with respect to claims asserted pursuant to Section 7.1 from the
Escrow Amount prior to seeking reimbursement by any other means. Subject to
Section 7.3, to the extent a Buyer Indemnified Party seeks indemnification or
reimbursement from the Escrow Amount, such Buyer Indemnified Party shall give
prompt direction to the Escrow Agent in accordance with the terms of the Escrow
Agreement.
7.3 NOTICE; DEFENSE OF CLAIMS. An indemnified party may make claims for
indemnification hereunder by giving written notice thereof to the indemnifying
party within the period in which indemnification claims can be made hereunder.
If indemnification is sought for a claim or liability asserted by a third party,
the indemnified party shall also give written notice thereof to the indemnifying
party promptly after it receives notice of the claim or liability being
asserted, but the failure to do so shall not relieve the indemnifying party from
any liability except to the extent that it is prejudiced by the failure or delay
in giving such notice. Such notice shall summarize the bases for the claim for
indemnification and any claim or liability being asserted by a third party.
Within twenty (20) days after receiving such notice the indemnifying party shall
give written notice to the indemnified party stating whether it disputes the
claim for indemnification and whether it will defend against any third party
claim or liability at its own cost and expense. If the indemnifying party fails
to give notice that it disputes an indemnification claim within twenty (20) days
after receipt of notice thereof, it shall be deemed to have accepted and agreed
to the claim, which shall become immediately due and payable. If the
indemnifying party notifies the indemnified party that it disputes such claim as
provided above, and the disputed claim is not resolved or compromised within
thirty (30) days after the indemnifying party sends notice of dispute of the
same, or in the event of a third-party claim or suit within fifteen (15) days
after its resolution or compromise, said claim shall be referred to
JAMS/Endispute, Inc. or its successor, to be settled by arbitration in
accordance with Section 8.12 hereto. The indemnifying party shall be entitled to
direct the defense against a third party claim or liability with counsel
selected by it (subject to the consent of the indemnified party, which consent
shall not be unreasonably withheld) as long as the indemnifying party is
conducting a good faith and diligent defense. The indemnified party shall at all
times have the right to fully participate in the defense of a third party claim
or liability at its own expense directly or through counsel; PROVIDED, HOWEVER,
that if the named parties to the action or proceeding include both the
indemnifying party and the indemnified party and the indemnified party is
advised that representation of both parties by the same
33
counsel would be inappropriate under applicable standards of professional
conduct, the indemnified party may engage separate counsel at the expense of the
indemnifying party. If no such notice of intent to dispute and defend a third
party claim or liability is given by the indemnifying party, or if such good
faith and diligent defense is not being or ceases to be conducted by the
indemnifying party, the indemnified party shall have the right, at the expense
of the indemnifying party, to undertake the defense of such claim or liability
(with counsel selected by the indemnified party), and to compromise or settle
it, exercising reasonable business judgment. The indemnified party shall make
available such information and assistance as the indemnifying party may
reasonably request and shall cooperate with the indemnifying party in such
defense, at the expense of the indemnifying party.
7.4 FAIR MARKET VALUE. The "Fair Market Value" of a share of the
Escrowed Stock shall mean, as of a given day, the arithmetic average for each of
the five (5) business days ending on such given day of (i) the last sale price
reported on the principal national securities exchange on which the Webhire
Common Stock is traded, if the Webhire Common Stock is then traded on a national
securities exchange; or (ii) the last sale price reported on NASDAQ, if the
Webhire Common Stock is then traded on NASDAQ; or (iii) closing bid price (or
average of the bid prices) last quoted by an established quotation service for
over-the-counter securities, if the Webhire Common Stock is not reported on
NASDAQ, or (iv) to the extent none of the aforementioned valuations are
applicable, the AFair Market Value" shall be determined by an independent
investment banking firm mutually acceptable by Webhire and the Stockholder
Representative (as defined in Section 7.7); provided, however, that to the
extent such Escrowed Stock is an Assumed Option, the Fair Market Value shall be
reduced by the per share exercise price of such Assumed Option.
7.5 INDEMNIFICATION BY WEBHIRE. Webhire agrees to indemnify and hold
each of the Principal Stockholders harmless from and against any damages,
liabilities, losses, taxes, fines, penalties, costs and expenses (including,
without limitation, reasonable fees of counsel) of any kind or nature whatsoever
(whether or not arising out of third-party claims and including all amounts paid
in investigation, defense or settlement of the foregoing) which may be sustained
or suffered by him or her arising out of or based upon fraud, intentional
misrepresentation or a willful breach of any representation, warranty or
covenant made by Webhire or the Acquisition Corp. in this Agreement or in any
certificate, schedule or exhibit delivered by Webhire or the Acquisition Corp.
hereunder (collectively an "Intentional Wrongdoing") or any other breach of any
representation, warranty or covenant made by Webhire or the Acquisition Corp. in
this Agreement or in any certificate, schedule or exhibit delivered by Webhire
or the Acquisition Corp. hereunder, or by reason of any claim, action or
proceeding asserted or instituted growing out of any matter or thing
constituting such a breach.
7.6 LIMITATION ON INDEMNIFICATION BY WEBHIRE. Notwithstanding the
foregoing, the right of Principal Stockholders to indemnification under Section
7.5 shall be subject to the following provisions:
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(a No indemnification shall be payable to the Principal
Stockholders with respect to claims asserted pursuant to Section 7.5 (other than
claims based upon an Intentional Wrongdoing) after July 9, 2000;
(b No indemnification shall be payable to the Principal
Stockholders with respect to claims asserted pursuant to Section 7.5 that are
based upon an Intentional Wrongdoing after July 9, 2002;
(c No indemnification shall be payable with respect to claims
asserted pursuant to Section 7.5 (other than claims based upon an Intentional
Wrongdoing), except to the extent the total of all claims for indemnification
pursuant to Section 7.5 shall exceed $10,000 in the aggregate, whereupon the
full amount of such claims, up to an aggregate amount of $1,997,500, shall be
recoverable subject to, and in accordance with, the terms hereof; and
(d Notwithstanding any other provision of this Agreement, in
no event shall the aggregate indemnity obligations of Webhire pursuant to this
Section 7 exceed $1,997,500.
7.7 STOCKHOLDER REPRESENTATIVE. In any dealings with the Principal
Stockholders regarding indemnification obligations under this Section 7,
including disputes as to the existence or amount of any indemnification
obligation or regarding the Escrow Agreement, Webhire shall be entitled to rely
on its communications with Xxxxxxxx (the "Stockholder Representative") on behalf
of all applicable Principal Stockholders; and any notice required to be given by
Webhire in connection with any indemnification obligations under this Section 7
shall be deemed given to all of the Principal Stockholders if given to the
Stockholder Representative.
The Stockholder Representative shall take, and the Principal
Stockholders agree that the Stockholder Representative shall take, any and all
actions which he believes are necessary or appropriate under this Agreement for
and on behalf of the Principal Stockholders, including without limitation
defending indemnity claims, consenting to, compromising or settling all
indemnity claims, conducting negotiations with Webhire and its representatives
regarding such claims, dealing with Webhire and the Escrow Agent under the
Escrow Agreement with respect to all matters arising under the Escrow Agreement,
taking any and all other actions specified in or contemplated by this Agreement
and engaging counsel, accountants or other representatives in connection with
the foregoing matters.
SECTION 8. MISCELLANEOUS.
8.1 FEES AND EXPENSES. Except as provided in this Section 8.1, each of
the parties will bear its own expenses in connection with the negotiation and
the consummation of the transactions contemplated by this Agreement, and no
expenses of the Company or the
35
Principal Stockholders relating in any way to the purchase and sale of the
Company Stock or the Company Options hereunder and the transactions contemplated
hereby, including without limitation, investment banking, brokerage, legal,
accounting or other professional expenses and income taxes of the Company or the
Principal Stockholders, shall be charged to or paid by the Company after the
Closing, the Surviving Corporation, Acquisition Corp or Webhire, except that
Webhire shall pay at the Closing the Company's outstanding legal fees, subject
to a maximum of $15,000.
8.2 GOVERNING LAW. This Agreement shall be construed under and governed
by the internal laws of the Commonwealth of Massachusetts without regard to its
conflict of laws provisions.
8.3 NOTICES. Any notice, request, demand or other communication
required or permitted hereunder shall be in writing and shall be deemed to have
been given if delivered or sent by facsimile transmission, upon receipt, if sent
by overnight delivery providing receipt of delivery, two business days after
being sent, or if sent by registered or certified mail, upon the sooner of the
date on which receipt is acknowledged or the expiration of three days after
deposit in United States post office facilities properly addressed with postage
prepaid. All notices to a party will be sent to the addresses set forth below or
to such other address or person as such party may designate by notice to each
other party hereunder:
TO WEBHIRE, ACQUISITION
CORP. OR THE SURVIVING
CORPORATION: WEBHIRE, INC.
00 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
With a copy to: Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxx III, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
TO COMPANY: HIREWORKS, INC.
X.X. Xxx 00
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
36
With a copy to: Xxxxxx, Gesmer & Xxxxxxxxx, LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
TO THE PRINCIPAL
STOCKHOLDERS: Xxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Tel: (000) 000-0000
Xxxxxxx Xxxxxx
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
Xxxxx X. Xxxxxx
00 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Tel: (000) 000-0000
With a copy to: Xxxxxx, Gesmer & Xxxxxxxxx, LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
Any notice given hereunder may be given on behalf of any party by his counsel or
other authorized representatives.
8.4 ENTIRE AGREEMENT. This Agreement, including the Schedules and
Exhibits referred to herein and the other writings specifically identified
herein or contemplated hereby, is complete, reflects the entire agreement of the
parties with respect to its subject matter, and supersedes all previous written
or oral negotiations, commitments and writings with respect to its subject
matter.
8.5 ASSIGNABILITY; BINDING EFFECT. This Agreement may not be assigned
by the Principal Stockholders or the Company without the prior written consent
of Webhire. This Agreement shall be binding upon and enforceable by, and shall
inure to the benefit of, the parties hereto and their respective successors and
permitted assigns.
37
8.6 CAPTIONS AND GENDER. The captions in this Agreement are for
convenience only and shall not affect the construction or interpretation of any
term or provision hereof. The use in this Agreement of the masculine pronoun in
reference to a party hereto shall be deemed to include the feminine or neuter,
as the context may require.
8.7 EXECUTION IN COUNTERPARTS. For the convenience of the parties and
to facilitate execution, this Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same document.
8.8 AMENDMENTS. This Agreement may not be amended or modified, nor may
compliance with any condition or covenant set forth herein be waived, except by
a writing duly and validly executed by Webhire and the Stockholder
Representative, or in the case of a waiver, the party waiving compliance.
8.9 SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be deemed
prohibited or invalid under such applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invalidate the remainder of such provision
or the other provisions of this Agreement.
8.10 PUBLICITY AND DISCLOSURES. Except as required by law, no press
releases or public disclosure, either written or oral, of the transactions
contemplated by this Agreement, shall be made by a party to this Agreement
without, in the case of releases and disclosures by the Company or the Principal
Stockholders, the prior written consent of Webhire and, in the case of releases
and disclosures by Webhire or the Acquisition Corp, prior consultation with
Xxxxx Xxxxxxxx.
8.11 ARBITRATION. All disputes, claims, or controversies arising out of
or relating to this Agreement or the negotiation, validity or performance hereof
that are not resolved by mutual agreement shall be resolved solely and
exclusively by binding arbitration to be conducted before JAMS/Endispute, Inc.
or its successor. The arbitration shall be held in Boston, Massachusetts before
a single arbitrator and shall be conducted in accordance with the rules and
regulations promulgated by JAMS/Endispute, Inc. unless specifically modified
herein.
The parties covenant and agree that the arbitration shall commence
within sixty (60) days of the date on which a written demand for arbitration is
filed by any party hereto. In connection with the arbitration proceeding, the
arbitrator shall have the power to order the production of documents by each
party and any third-party witnesses; however, the arbitrator shall not have the
power to order the taking of depositions, the answering of interrogatories or
the response to requests for admission. In connection with any arbitration, each
party shall provide to the other, no later than seven (7) business days before
the date of the arbitration,
38
the identity of all persons that may testify at the arbitration and a copy of
all documents that may be introduced at the arbitration or considered or used by
a party's witness or expert. The arbitrator's decision and award shall be made
and delivered within six (6) months of the selection of the arbitrator. The
arbitrator's decision shall set forth a reasoned basis for any award of damages
or finding of liability. The arbitrator shall not have power to award damages in
excess of actual compensatory damages and shall not multiply actual damages or
award punitive damages or any other damages that are specifically excluded under
this Agreement, and each party hereby irrevocably waives any claim to such
damages.
The parties covenant and agree that they will participate in the
arbitration in good faith and that they will share equally its costs, except as
otherwise provided herein. The arbitrator may in his or her discretion assess
costs and expenses (including the reasonable legal fees and expenses of the
prevailing party) against any party to a proceeding. Any party unsuccessfully
refusing to comply with an order of the arbitrators shall be liable for costs
and expenses, including attorneys' fees, incurred by the other party in
enforcing the award. This Section 8.11 applies equally to requests for
temporary, preliminary or permanent injunctive relief, except that in the case
of temporary or preliminary injunctive relief any party may proceed in court
without prior arbitration for the limited purpose of avoiding immediate and
irreparable harm. The provisions of this Section 8.11 shall be enforceable in
any court of competent jurisdiction.
8.12 CONSENT TO JURISDICTION. Each of the parties hereto irrevocably
and unconditionally consents to the exclusive jurisdiction of JAMS/Endispute,
Inc. to resolve all disputes, claims or controversies arising out of or relating
to this Agreement or the negotiation, validity or performance hereof, and
further consents to the jurisdiction of any Federal or state court sitting in
The Commonwealth of Massachusetts for the purposes of enforcing the arbitration
provisions of Section 8.11 of this Agreement. Each party further irrevocably
waives any objection to proceeding before JAMS/Endispute based upon lack of
personal jurisdiction or to the laying of venue and further irrevocably and
unconditionally waives and agrees not to make a claim in any court that
arbitration before JAMS/Endispute, Inc. has been brought in an inconvenient
forum. Each of the parties hereto hereby consents to service of process by
registered mail at the address to which notices are to be given. Each of the
parties hereto agrees that its or his submission to jurisdiction and its or his
consent to service of process by mail is made for the express benefit of the
other parties hereto.
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8.13 SPECIFIC PERFORMANCE. Notwithstanding Section 8.11, it is
specifically understood and agreed that any breach of the provisions of this
Agreement by any person subject hereto will result in irreparable injury to the
other parties hereto, that the remedy at law alone will be an inadequate remedy
for such breach, and that, in addition to any other remedies which they may
have, such other parties may enforce their respective rights by actions for
specific performance (to the extent permitted by law).
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed as of the date set forth above by their duly authorized
representatives.
WEBHIRE, INC.
By:
Name:
Title:
HWK ACQUISITION CORP.
By:
Name:
Title:
HIREWORKS, INC.
By:
Name:
Title:
PRINCIPAL STOCKHOLDERS:
Xxxxx X. Xxxxxxxx
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Xxxxxxx Xxxxxx
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Xxxxx X. Xxxxxx
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