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EXHIBIT 99.1
COMPANY STOCKHOLDERS AGREEMENT
THIS COMPANY STOCKHOLDERS AGREEMENT (this "Agreement") is entered into
this 9th day of December, 1999, by and among The Titan Corporation, a Delaware
corporation ("Acquiror"), A T Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of Acquiror ("Merger Sub"), and each other Person
listed on the signature page hereof who is a stockholder (each a "Stockholder"
and collectively, the "Stockholders") of Advanced Communication Systems, Inc.,
a Delaware corporation (the "Company").
WHEREAS, the Stockholders own of record and beneficially the shares of
common stock, par value $.01 per share of the Company ("Company Common Stock")
set forth opposite their respective names on Schedule A hereto (the "Shares")
and desire to enter into this Agreement with respect to such shares of Company
Common Stock;
WHEREAS, Acquiror, Merger Sub and the Company have contemporaneously with
the execution of this Agreement entered into an Agreement and Plan of Merger
(the "Merger Agreement"), dated as of the date hereof, which provides, among
other things, for the merger (the "Merger") of the Merger Sub with and into the
Company pursuant to the terms and conditions thereof; capitalized terms used
herein and not otherwise defined shall have the meanings given to such terms as
in the Merger Agreement;
WHEREAS, as an essential condition and inducement to Acquiror and Merger
Sub entering into the Merger Agreement, Acquiror has required that the
Stockholders agree, and the Stockholders have agreed, to enter into this
Agreement; and
NOW, THEREFORE, the parties hereto, in consideration of the foregoing, the
mutual covenants and agreements contained herein and in the Merger Agreement
and for other good and valuable consideration, the receipt and sufficiency of
which hereby are acknowledged, and intending to be legally bound hereby, agree
as follows:
SECTION 1. VOTING
(a) Each Stockholder hereby agrees to appear, or to cause the holder of
record on any applicable record date (the "Record Holder") to appear, in person
or by proxy, for the purpose of obtaining a quorum at any annual or special
meeting of stockholders of the Company and at any adjournment thereof at which
matters relating to the Merger, Merger Agreement or any transaction
contemplated thereby are considered; and
(b) Each Stockholder further agrees that, it shall vote, or cause the Record
Holder to vote, in person or by proxy all of the Shares, and any other voting
interests in the Company owned or hereafter acquired beneficially or of record
by such Stockholder:
(i) in favor of the Merger and the adoption of the Merger Agreement
and the transactions contemplated thereby (including any amendments or
modifications of the terms thereof approved by the Board of Directors of the
Company and by Acquiror) in
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connection with any meeting of, or solicitation of consents from, the
stockholders of the Company at which or in connection with which the Merger and
the Merger Agreement are submitted for the consideration and vote of the
stockholders of the Company;
(ii) against approval or adoption of resolutions which would have the
effect of preventing or materially delaying consummation of the Merger or
otherwise preventing or materially delaying the Company from performing its
obligations under the Merger Agreement; and
(iii) against any action which would constitute a material breach of
any provision of the Merger Agreement.
To the extent inconsistent with the foregoing provisions of this Section 1,
each Stockholder revokes any and all previous proxies with respect to Shares
owned beneficially or of record by such Stockholder and agrees not to grant any
proxy with respect to and any other voting interests in the Company owned or
hereafter acquired beneficially or of record by such Stockholder.
SECTION 2. PROXY; FURTHER ASSURANCES
(a) Contemporaneously with the execution of this Agreement: (i) each
Stockholder has delivered to Acquiror a proxy in the form attached to this
Agreement as Exhibit A, which shall be coupled with an interest and
irrevocable, with respect to the shares referred to therein (the "Proxy"); and
(ii) each Stockholder has caused to be delivered to Acquiror an additional
proxy (in the form attached hereto as Exhibit A) executed on behalf of the
record owner of any outstanding shares of Company Common Stock that are owned
beneficially (within the meaning of Rule 13d-3 under the Exchange Act), but not
of record, by such Stockholder, which proxy shall be irrevocable to the fullest
extent permitted by law and to the extent provided therein, with respect to the
shares referred to therein.
(b) Each Stockholder shall, at Acquiror's expense, perform such further
acts and execute such further documents and instruments as may reasonably be
required to vest in Acquiror the power to carry out and give effect to the
provisions of this Agreement. Without limiting the generality of the foregoing,
none of the parties hereto shall enter into any agreement or arrangement (or
alter, amend or terminate any existing agreement or arrangement) or transaction
if such action would materially impair or materially interfere with the ability
of any party to effectuate, carry out and comply with all of the terms of this
Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF EACH STOCKHOLDER
Each Stockholder hereby, severally and not jointly, represents and
warrants to Acquiror as follows:
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(a) Such Stockholder has the legal capacity and all other power and
authority necessary to enter into this Agreement, to perform the obligations
hereunder and to consummate the transactions contemplated hereby. This
Agreement has been duly executed and delivered by such Stockholder and,
assuming due authorization, execution and delivery of this Agreement by
Acquiror, Merger Sub and the other parties hereto, constitutes a legal, valid
and binding obligation of such Stockholder, enforceable in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws of general applicability
relating to or affecting creditor's rights generally and by the application of
general principles of equity.
(b) The execution and delivery of this Agreement and the consummation of
the transactions herein contemplated will not to the knowledge of such
Stockholder, (i) conflict with or violate any law, regulation, court order,
judgment or decree applicable to such Stockholder or by which the property of
such Stockholder is bound or affected, or (ii) conflict with or result in any
breach of or constitute a default under any contract or agreement to which such
Stockholder is a party or by which such Stockholder or such Stockholder's
property is bound or affected, which conflict, violation, breach or default
would materially impair or materially interfere with such Stockholder's ability
to perform its obligations under this Agreement.
(c) To the knowledge of such Stockholder, the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby do
not and will not require any consent or other action by any Person under, any
provision of any agreement, contract or other instrument binding on such
Stockholder.
(d) The Shares reflected on Schedule A as being owned by such Stockholder
are the only shares of voting capital stock of the Company or any other voting
interests in the Company owned beneficially or of record by such Stockholder,
and except as set forth in Schedule A, such Stockholder does not own any other
options, warrants or rights to acquire shares of any class of capital stock of
the Company or any other voting interests in the Company. Such Stockholder has
the requisite power respecting voting and transfer of such Stockholder's
Shares. Except as set forth on Schedule 3(d) hereto, the shares and
certificates representing such Shares held by such Stockholder are owned as
indicated on Schedule A by such Stockholder, free and clear of all liens,
claims, security interests, proxies, options, warrants or other rights, voting
trusts or agreements, understandings or arrangements or any other Encumbrances
whatsoever, except for any such Encumbrances or proxies arising hereunder.
(e) No investment banker, broker, finder or other intermediary is entitled
to a fee or commission in respect of this Agreement based upon any arrangement
or agreement made by or on behalf of such Stockholder, except for fees that may
be payable by the Company or Acquiror in conjunction with the transactions
contemplated by the Merger Agreement.
SECTION 4. COVENANTS OF EACH STOCKHOLDER
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(a) From the date of this Agreement until the Effective Time or, if
earlier, the termination of this Agreement pursuant to Section 17 (Termination)
hereof, each Stockholder agrees severally and not jointly that such Stockholder
will not, and will use its "reasonable efforts" to not permit any of the
Representatives of the Company to, directly or indirectly, (i) initiate,
solicit, knowingly facilitate or encourage the submission of an Acquisition
Proposal for the Company; (ii) participate in any discussions or negotiations
regarding, or furnish to any Person any information with respect to, or take
any other action knowingly to facilitate any inquiries or the making of any
proposal that constitutes an Acquisition Proposal for the Company; (iii) grant
any waiver or release under any standstill or similar agreement with respect to
any class of equity securities of the Company; or (iv) enter into any agreement
with respect to any Acquisition Proposal for the Company, other than with
Acquiror, or authorize or permit any of Stockholder's Representatives to take
any such action and, such Stockholder shall promptly notify Acquiror of any
such inquiries and proposals received by such Stockholder or, to such
Stockholder's knowledge, any of such Stockholder's Representatives, relating to
any of such matters. Each Stockholder severally and not jointly further agrees
to use its "reasonable efforts" as a stockholder to cause the Company to comply
with the obligations of the Company set forth in Section 7.8 of the Merger
Agreement.
(b) Except pursuant to the terms of this Agreement, each Stockholder agrees
severally and not jointly that such Stockholder will not, without the prior
written consent of Acquiror or Merger Sub, directly or indirectly, grant any
proxies or enter into any voting trust or other agreement or arrangement with
respect to the voting of any capital stock or any options, warrants or other
rights to acquire stock of the Company.
(c) Each Stockholder agrees that, during the period from the date of this
Agreement through the Termination Date, such Stockholder shall not cause or
permit any transfer, assignment, conveyance or other disposition of his Shares,
or any other voting interests in the Company owned or hereafter acquired
beneficially or of record by such Stockholder, unless each Person to which any
Shares or any interest therein is or may be transferred shall have: (i)
executed a counterpart to this Agreement; and (ii) agreed to hold such Shares
or any interest therein subject to the terms and provisions of this Agreement.
SECTION 5. [RESERVED]
SECTION 6. SPECIFIC PERFORMANCE
Each Stockholder acknowledges and agrees that there would be no adequate
remedy at law for Acquiror or Merger Sub if such Stockholder fails to perform
any of such Stockholder's obligations hereunder, and accordingly agrees that
Acquiror and Merger Sub, in addition to any other remedy to which they may be
entitled at law or in equity, shall be entitled to compel specific performance
of the obligations of such Stockholder under this Agreement in accordance with
the terms and conditions of this Agreement in any court of the United States or
any State thereof having jurisdiction.
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SECTION 7. GOVERNING LAW
This Agreement will be governed by and construed in accordance with the
laws of the State of Delaware without regard to principles of conflicts of law.
SECTION 8. PARTIES IN INTEREST
This Agreement shall inure to the benefit of and shall be binding upon the
parties hereto and their respective heirs, legal representatives and permitted
assigns. If any Stockholder shall at any time hereafter acquire ownership of,
or voting power with respect to, any additional shares of capital stock or any
other voting interests in the Company in any manner, whether by the exercise of
any options or any securities or rights convertible into or exchangeable for
shares of capital stock or any other voting interests in the Company, by
operation of law or otherwise, such shares or other interests shall be held
subject to all of the terms and provisions of this Agreement. Without limiting
the foregoing, each Stockholder specifically agrees that the obligations of
such Stockholder hereunder shall not be terminated by operation of law, whether
by death or incapacity of such Stockholder or otherwise.
SECTION 9. AMENDMENT
This Agreement shall not be amended, altered or modified except by an
instrument in writing duly executed and delivered on behalf of each of the
parties hereto.
SECTION 10. SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible to the fullest extent permitted by
applicable law in a mutually acceptable manner in order that the terms of this
Agreement remain as originally contemplated to the fullest extent possible.
SECTION 11. WAIVER
Except as provided in this Agreement, no action taken pursuant to this
Agreement, including without limitation any investigation by or on behalf of
any party, shall be deemed to constitute a waiver by the party taking such
action of compliance with any representations, warranties, covenants or
agreements contained in this Agreement. The waiver by any party hereto of a
breach of any provision hereunder shall not operate or be construed as a wavier
of any prior or subsequent breach of the same or any other provision hereunder.
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SECTION 12. NOTICES
All notices and other communications given or made pursuant hereto shall be
in writing and shall be deemed to have been duly given or made as of the date
delivered, mailed or transmitted, and shall be effective upon receipt, if
delivered personally, mailed by registered or certified mail (postage prepaid,
return receipt requested) to the parties at the following addresses (or at such
other address for a party as shall be specified by like changes of address) or
sent by electronic transmission to the telecopier number specified below:
If to a Stockholder:
To such Stockholder's address
or telecopier number as set forth
on Schedule A attached hereto
with a copy to:
Venable, Baetjer, Xxxxxx & Xxxxxxxxx, LLP
0000 Xxx Xxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, Esq.
If to Acquiror or Merger Sub:
The Titan Corporation
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxxx, Esq., General Counsel
with a copy to:
Xxxxx & Xxxxxxx L.L.P.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 0000
XxXxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxxx, Esq.
SECTION 13. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement among the parties hereto
pertaining to the subject matter hereof and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties.
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SECTION 14. ASSIGNMENT
The Stockholders may not assign any of their rights or obligations under
this Agreement to any other Person, without the express written consent of
Acquiror. Acquiror may not assign any of its rights or obligations under this
Agreement to any other Person.
SECTION 15. HEADINGS
Section headings are included solely for convenience and are not considered
to be part of this Agreement and are not intended to be an accurate description
of the contents thereof.
SECTION 16. COUNTERPARTS
This Agreement may be executed and delivered in one or more counterparts,
and by the different parties hereto in separate counterparts, each of which
when executed and delivered shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 17. TERMINATION
This Agreement and all of the parties' rights and obligations hereunder
shall terminate on the earlier to occur of (a) the date on which the Merger
Agreement is validly terminated pursuant to the provisions thereof, or (b) the
Effective Time; as defined in the Merger Agreement, (the "Termination Date").
SECTION 18. OFFICERS AND DIRECTORS; AFFILIATE AGREEMENTS
(a) Notwithstanding anything else herein to the contrary but subject to the
proviso set forth in this Section 19(a), (i) nothing set forth herein shall be
deemed to restrict or otherwise prohibit a Stockholder who is an officer or
director of the Company from exercising, in such individual's capacity as an
officer or director of the Company, what such Stockholder believes in good
faith to be his or her fiduciary duties as an officer or director of the
Company to the stockholders of the Company, and (ii) and no action or inaction
required hereby shall require a Stockholder who is an officer or director of
the Company to take any action or refrain from taking any action, in such
individual's capacity as an officer or director of the Company, that such
Stockholder believes in good faith is required by or would be a breach of his
or her fiduciary duties as an officer or director of the Company to the
stockholders of the Company; provided, however, that, notwithstanding the
foregoing, with respect to any matter set forth in Section 7.8 of the Merger
Agreement, each Stockholder who is an officer or director of the Company shall
exercise his or her fiduciary duties to the stockholders of the Company
pursuant to and in accordance with the provisions of Section 7.8 of the Merger
Agreement.
(b) Each Stockholder who also executes and enters into an Affiliate Agreement
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hereby agrees and acknowledges that, notwithstanding any other provisions of
this Agreement and in addition to any obligations of such Stockholder
hereunder, such Stockholder is and will be subject to all of the terms and
provisions of such Affiliate Agreement and the obligations of such Stockholder
contained in such Affiliate Agreement are and will be independent, separate and
apart from the obligations of such Stockholder hereunder.
SECTION 19. SURVIVAL
The representations and warranties in this Agreement shall survive the
execution and delivery of this Agreement and expire on the Termination Date;
provided, however, that the covenants and agreements of the parties shall
survive the execution and delivery of this Agreement and terminate on the
earlier to occur of: (i) the Termination Date or (ii) the date on which the
parties' obligations under this Agreement are fully performed.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Company Stockholders Agreement, or have caused this Company Stockholders
Agreement to be executed and delivered on their behalf, as of the date first
above written.
THE TITAN CORPORATION
By: /s/ Xxxx X. Xxx
---------------------------
Name: Xxxx X. Xxx
Title: Chairman and Chief Executive Officer
A T ACQUISITION CORP.
By: /s/ Xxxx X. Xxx
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Name: Xxxx X. Xxx
Title: Chairman and Chief Executive Officer
STOCKHOLDERS
By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
Address: 0000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
By: /s/ Xxxxxxx Xxxxxxxx
---------------------------
Name: Xxxxxxx Xxxxxxxx
Address: 0000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxxxx
Address: 0000 Xxxxxxxx Xxxx Xxxxx
XxXxxx, XX 00000
By: /s/ Xxxxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Address: 0000 Xxxxxxxx Xxxx Xxxxx
XxXxxx, XX 00000
By: /s/ Xxxxxxx X. Xxxxxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Address: X.X. Xxx 000
Xxxxx, XX 00000
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SCHEDULE A
Stockholder Name and Address Shares of Company Common Stock
---------------------------- ------------------------------
Xxxxxx X. and Xxxxxxx Xxxxxxxx(1) 847,500
0000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxxxx(2) 425,021
X.X. Xxx 000
Xxxxx, XX 00000
Xxxxxx X. and Xxxxxxxx X. Xxxxxxxx(3) 847,500
0000 Xxxxxxxx Xxxx Xxxxx
XxXxxx, XX 00000
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1 Includes 333,371 shares owned by the Xxxxxxxx 1997 Trust No. 1 and 333,371
shares owned by the Xxxxxxxx 1997 Trust No. 2, both of which Xxxxxx X. Xxxxxxxx
is the sole trustee, and 180,758 shares owned by Xxxxxx X. Xxxxxxxx and Xxxxxxx
Xxxxxxxx as joint tenants.
2 Includes 136,274 shares owned by the Xxxxxxx X. Xxxxxxxxxx Trust No. 1,
of which Xxxxxxx X. Xxxxxxxxxx is the sole trustee, and 3,783 shares held
in trust for the benefit of Xxxxxx Xxxxxxxxxx.
3 Includes: (i) 216,609 shares owned by the Xxxxxxxx 1997 Trust No. 1; (ii)
216,609 shares owned by the Xxxxxxxx 1997 Trust No. 2; (iii) 207,141 shares
owned by Xxxxxx X. Xxxxxxxx Revocable Trust; and (iv) 207,141 shares owned by
Xxxxxxxx X. Xxxxxxxx Revocable Trust. Xxxxxxxx X. Xxxxxxxx and Xxxxxx X.
Xxxxxxxx are trustees for the Xxxxxxxx 1997 Trust No. 1 and Xxxxxxxx 1997 Trust
No. 2; Xxxxxx X. Xxxxxxxx is the trustee for the Xxxxxx X. Xxxxxxxx Revocable
Trust; and Xxxxxxxx X. Xxxxxxxx is the trustee for Xxxxxxxx X. Xxxxxxxx
Revocable Trust.
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EXHIBIT A
Form of Irrevocable Proxy
The undersigned Stockholder of Advanced Communication Systems, Inc., a
Delaware corporation (the "Company"), hereby appoints and constitutes The Titan
Corporation, a Delaware corporation ("Acquiror"), the attorneys and proxies of
the undersigned, with full power of substitution and resubstitution, to the
full extent of the undersigned's voting rights with respect to (a) the
outstanding shares of common stock, par value $.01 per share, of the Company
(the "Company Common Stock") or any other capital stock of the Company
(collectively with the Company Common Stock, the "Capital Stock") owned of
record by the undersigned as of the date of this proxy, which shares are
specified on the final page of this proxy, and (b) any and all other shares of
Capital Stock of the Company which the undersigned may acquire on or after the
date hereof, provided that this proxy automatically shall be revoked with
respect to any shares of Capital Stock that are sold, transferred or otherwise
disposed of by the undersigned in accordance with the Company Stockholders
Agreement (as hereinafter defined) ("Transferred Stock") effective as of the
date of such sale, transfer or other disposition ("Date of Disposition"). Upon
the execution hereof, all prior proxies given by the undersigned with respect
to any of the Capital Stock are hereby revoked, and the undersigned agrees that
no subsequent proxy will be given with respect to the voting of any of the
Capital Stock (other than Transferred Stock after the Date of Disposition given
by the purchaser, transferee or other beneficiary of such other disposition
with respect to such stock) except to the extent that such proxies do not
prevent the voting of this proxy in favor of the transactions described herein.
This proxy is coupled with an interest and irrevocable. This proxy is
granted (i) in connection with the execution and delivery of the Company
Stockholders Agreement, dated as of the date hereof, among Acquiror and the
undersigned (the "Company Stockholders Agreement") and (ii) in consideration of
Acquiror entering into the Agreement and Plan of Merger, dated as of the date
hereof, among Acquiror, A T Acquisition Corp., a Delaware corporation (the
"Merger Sub") and the Company (the "Merger Agreement").
The proxy named above (and its successors) will, prior to the Termination
Date (as hereinafter defined), be empowered, and may exercise this proxy, to
vote the Capital Stock at any meeting of the Stockholders of the Company,
however called, or in connection with any solicitation of written consents from
Stockholders of the Company, called or solicited, as the case may be, for the
purpose of voting on the Merger Agreement and the transactions contemplated
thereby in favor of the approval and adoption of the Merger Agreement and the
approval of the merger contemplated thereby, and in favor of each of the other
actions contemplated by the Merger Agreement. The undersigned may vote the
Capital Stock on all other matters.
This proxy shall be binding upon the representatives, successors and
permitted assigns of the undersigned.
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If any provision of this proxy or any part of any such provision is held
under any circumstances to be invalid or unenforceable in any jurisdiction,
then (a) such provision or part thereof shall, with respect to such
circumstances and in such jurisdiction, be deemed amended to conform to
applicable laws so as to be valid and enforceable to the fullest possible
extent, (b) the invalidity or unenforceability of such provision or part
thereof under such circumstances and in such jurisdiction shall not affect the
validity or enforceability of such provision or part thereof under any other
circumstances or in any other jurisdiction, and (c) the invalidity or
unenforceability of such provision or part thereof shall not affect the
validity or enforceability of the remainder of such provision or the validity
or enforceability of any other provision of this proxy. Each provision of this
proxy is separable from every other provision of this proxy, and each part of
each provision of this proxy is separable from every other part of such
provision.
This proxy and the rights contained herein shall terminate upon the
termination of the Company Stockholders Agreement as provided therein (the
"Termination Date").
Date: December 9, 1999
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Stockholder's Name
Number of shares of common stock and other
capital stock of the Company owned of record
and beneficially as of the date of this
proxy:
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