EXHIBIT C
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT (the "Agreement"), dated as of November 18,
1999, by and between Tumbleweed Communications Corp., a Delaware
corporation ("Parent"), and Worldtalk Communications Corporation, a
Delaware corporation (the "Company").
WITNESSETH:
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Company, Parent and Keyhole Acquisition Corp., a Delaware
corporation ("Sub"), are entering into an Agreement and Plan of Merger,
dated as of the date hereof (the "Merger Agreement"), which provides that,
among other things, upon the terms and subject to the conditions thereof,
Sub will be merged with and into the Company (the "Merger"), with the
Company continuing as the surviving corporation; and
WHEREAS, as a condition and inducement to Parent's willingness to
enter into the Merger Agreement, Parent has required that the Company
agree, and the Company has so agreed, to grant to Parent an option with
respect to certain shares of the Company's authorized but unissued common
stock on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, to induce Parent and Sub to enter into the Merger
Agreement and in consideration of the representations, warranties,
covenants and agreements set forth herein and in the Merger Agreement, the
parties hereto intending to be legally bound, hereby agree as follows.
Capitalized terms used herein but not defined herein shall have the
meanings set forth in the Merger Agreement.
1. GRANT OF OPTION. The Company hereby grants Parent an irrevocable
option (the "Option") to purchase a number of shares (the "Shares") of
common stock, par value $0.01 per share, of the Company (the "Company
Common Stock") equal to the Option Number (as defined hereinafter), on the
terms and subject to the conditions set forth below.
2. EXERCISE OF OPTION.
(a) Exercise. At any time or from time to time prior to the
termination of the Option granted hereunder in accordance with the terms of
this Agreement, Parent (or a wholly-owned subsidiary of Parent designated
by Parent) may exercise the Option, in whole or in part, if on or after the
date hereof:
(i) any corporation, partnership, individual, trust, unincorporated
association, or other entity or "person" (as defined in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act")) other
than Parent or any of its "affiliates" (as defined in the Exchange Act) (a
"Third Party"), shall have:
(A) commenced or announced an intention to commence a bona fide
tender offer or exchange offer for any shares of Company Common Stock,
the consummation of which would result in "beneficial ownership" (as
defined under Rule 13d-3 of the Exchange Act) by such Third Party
(together with all such Third Party's affiliates and "associates" (as
such term is defined in the Exchange Act)) of 20% or more of the then
voting equity of the Company (either on a primary or a fully diluted
basis);
(B) filed a Notification and Report Form under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the
"HSR Act"), reflecting an intent to acquire the Company or any assets
or securities of the Company;
(C) solicited "proxies" in a "solicitation" subject to the proxy
rules under the Exchange Act, executed any written consent or become a
"participant" in any "solicitation" (as such terms are defined in
Regulation 14A under the Exchange Act), in each case with respect to
the Company Common Stock; or
(ii) the events described in Section 7.2(b) of the Merger
Agreement that would require the Company to pay Parent the fee set forth
therein (but without the necessity of Parent having terminated the Merger
Agreement).
(iii) Each of the events described in clauses (i) and (ii)
hereof shall be referred to herein as a "Trigger Event." The Company
shall notify Parent promptly in writing of the occurrence of any
Trigger Event; however, such notice shall not be a condition to the
right of Parent to exercise the Option.
(b) Exercise Procedure. In the event Parent wishes to
exercise the Option, Parent shall deliver to the Company a written notice
(an "Exercise Notice") specifying the total number of the Shares it wishes
to purchase. To the extent permitted by law and the Certificate of
Incorporation of the Company and provided that the conditions set forth in
Section 3 hereof to Company's obligation to issue the Shares to Parent
hereunder have been satisfied or waived, Parent shall, upon delivery of the
Exercise Notice and tender of the applicable aggregate Exercise Price,
immediately be deemed to be the holder of record of the shares of the
Company Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that
certificates representing such shares of the Company Common Stock shall not
heretofore have been delivered to Parent. Each closing of a purchase of the
Shares (a "Closing") shall occur at a place, on a date and at a time
designated by Parent in an Exercise Notice delivered at least two business
days prior to the date of the Closing.
(c) Termination of the Option. The Option shall terminate
upon the earlier of: (i) the Effective Time of the Merger; and (ii) the
termination of the Merger Agreement pursuant to Section 7.1(a), (b), (c) or
(e) thereof; and (iii) six (6) months following the termination of the
Merger Agreement pursuant to Section 7.1(d) or (f) thereof. Notwithstanding
the foregoing, if the Option cannot be exercised by reason of any
applicable judgment, decree, order, law or regulation, the Option shall
remain exercisable and shall not terminate until the earlier of (x) the
date on which such impediment shall become final and not subject to appeal,
and (y) 5:00 p.m. Pacific Standard Time, on the tenth (10th) business day
after such impediment shall have been removed. The rights of Parent set
forth in Sections 7 and 8 shall not terminate upon termination of Parent's
right to exercise the Option, but shall extend to the time provided in such
sections. Notwithstanding the termination of the Option, Parent shall be
entitled to purchase the shares of the Company Common Stock with respect to
which Parent had exercised the Option prior to such termination.
(d) Option Number. The "Option Number" shall initially be
the number of shares equal to nineteen and nine-tenths percent (19.9%) of
the total number of shares of the Company Common Stock issued and
outstanding as of the date of this Agreement, and shall be adjusted
hereafter to reflect changes in the Company's capitalization occurring
after the date hereof in accordance with Section 9 hereof. Notwithstanding
any other provision of this Agreement, in no event shall the Option Number
exceed nineteen and nine-tenths percent (19.9%) of the total number
of shares of the Company Common Stock issued and outstanding as of the date
of this Agreement, adjusted in accordance with Section 9 hereof.
(e) Exercise Price. The purchase price per share
of the Company Common Stock pursuant to the Option (the "Exercise Price")
shall be $10.527
3. CONDITIONS TO CLOSING. The obligation of the Company to
issue the Shares to Parent hereunder is subject to the conditions that (i)
all waiting periods, if any, under the HSR Act, applicable to the issuance
of the Shares and the acquisition of such shares by Parent hereunder shall
have expired or have been terminated; (ii) all consents, approvals, orders
or authorizations of, or registrations, declarations or filings with, any
federal, state or local administrative agency or commission or other
federal state or local governmental authority or instrumentality, if any,
required in connection with the issuance of the Shares and the acquisition
of such shares by Parent hereunder shall have been obtained or made, as the
case may be; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such issuance shall be in effect.
4. CLOSING. At any Closing,
(a) the Company shall deliver to Parent a single
certificate in definitive form representing the number of the Shares
designated by Parent in its Exercise Notice, such certificate to be
registered in the name of Parent and to bear the legend set forth in
Section 12 hereof;
(b) Parent shall deliver to the Company the aggregate
price for the Shares so designated and being purchased by wire transfer of
immediately available funds to the account or accounts specified in writing
by the Company;
(c) the Company shall pay all expenses, and any and all
federal, state and local taxes and other charges that may be payable in
connection with the preparation, issue and delivery of stock certificates
under this Section 4; and
(d) the Company shall cause the shares of the Company
Common Stock being delivered at the Closing to be approved for quotation on
the Nasdaq National Market and shall pay all expenses in connection with
the application for approval of such quotation. At any Closing at which
Parent is exercising the Option in part, Parent shall present and surrender
this Agreement to the Company, and the Company shall deliver to Parent an
executed new agreement with the same terms as this Agreement evincing the
right to purchase the balance of the shares of the Company Common Stock
purchasable hereunder.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to Parent that:
(a) the Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and
has the corporate power and authority to enter into this Agreement and to
carry out its obligations hereunder;
(b) the execution and delivery of this Agreement by the
Company and the consummation by the Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate
action on the part of the Company and no other corporate proceedings on the
part of the Company are necessary to authorize this Agreement or any of the
transactions contemplated hereby;
(c) this Agreement has been duly executed and delivered
by the Company and constitutes a valid and binding obligation of the
Company, and, assuming this Agreement constitutes a valid and binding
obligation of Parent, is enforceable against the Company in accordance with
its terms, except as enforceability may be limited by bankruptcy and other
laws affecting the rights and remedies of creditors generally and general
principles of equity;
(d) the Company has taken all necessary corporate action
to authorize and reserve for issuance and to permit it to issue, upon
exercise of the Option, and at all times from the date hereof through the
expiration of the Option will have reserved a number of authorized and
unissued shares of the Company Common Stock not less than the Option
Number, such amount being subject to adjustment as provided in Section 11
hereof, all of which, upon their issuance and delivery in accordance with
the terms of this Agreement, will be validly issued, fully paid and
nonassessable;
(e) upon delivery of the Shares to Parent upon the
exercise of the Option, Parent will acquire the Shares free and clear of
all claims, liens, charges, encumbrances and security interests of any
nature whatsoever;
(f) the execution and delivery of this Agreement by the
Company does not, and the performance of this Agreement by the Company will
not, conflict with, or result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or the loss of
a benefit under, or the creation of a lien, pledge, security interest or
other encumbrance on assets pursuant to (any such conflict, violation,
default, right of termination, cancellation or acceleration, loss or
creation, a "Violation"), (A) any provision of the Certificate of
Incorporation, or Bylaws, of the Company or (B) any provisions of any
mortgage, indenture, lease, contract or other agreement, instrument,
permit, concession, franchise, or license or (C) any judgment, order,
decree, statute, law, ordinance, rule or regulation applicable to the
Company or its properties or assets, which Violation, in the case of each
of clauses (B) and (C), would have a material adverse effect on the
Company;
(g) except for the expiration or early termination of the
waiting period under the HSR Act and except as contemplated by Section 8(b)
hereof and may be required under the Securities Act of 1933, as amended
(the "Securities Act"), the execution and delivery of this Agreement by the
Company does not, and the performance of this Agreement by the Company will
not, require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental or regulatory authority; and
(h) none of the Company or any of its affiliates or
anyone acting on its or their behalf has issued, sold or offered any
security of the Company to any person or entity under circumstances that
would cause the issuance and sale of shares of the Company Common Stock
hereunder to be subject to the registration requirements of the Securities
Act as in effect on the date hereof, and, assuming the representations and
warranties of Parent contained in Section 6(f) are true and correct, the
issuance, sale and delivery of the shares of the Company Common Stock
hereunder would be exempt from the registration and prospectus delivery
requirements of the Securities Act, as in effect on the date hereof, and
the Company shall not take any action which would cause the issuance, sale,
and delivery of shares of the Company Common Stock hereunder not to be
exempt from such requirements.
6. REPRESENTATIONS AND WARRANTIES OF PARENT. Parent represents
and warrants to the Company that:
(a) Parent is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and
has the corporate power and authority to enter into this Agreement and to
carry out its obligations hereunder;
(b) the execution and delivery of this Agreement by
Parent and the consummation by Parent of the transactions contemplated
hereby have been duly authorized by all necessary corporate action on the
part of Parent and no other corporate proceedings on the part of Parent are
necessary to authorize this Agreement or any of the transactions
contemplated hereby;
(c) this Agreement has been duly executed and delivered
by Parent and constitutes a valid and binding obligation of Parent, and,
assuming this Agreement constitutes a valid and binding obligation of the
Company, is enforceable against Parent in accordance with its terms, except
as enforceability may be limited by bankruptcy and other laws affecting the
rights and remedies of creditors generally and general principles of
equity;
(d) the execution and delivery of this Agreement by
Parent does not, and the performance of this Agreement by Parent will not,
result in any Violation pursuant to, (A) any provision of the Certificate
of Incorporation or By-laws of Parent, (B) any provisions of any mortgage,
indenture, lease, contract or other agreement, instrument, permit,
concession, franchise, or license or (C) any judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to Parent or its
properties or assets, which Violation, in the case of each of clauses (B)
and (C), would have a material adverse effect on Parent;
(e) except for the expiration or early termination of the
waiting period under the HSR Act and except as contemplated by Section 8(b)
hereof and as may be required under the Securities Act, the execution and
delivery of this Agreement by Parent does not, and the performance of this
Agreement by Parent will not, require any consent, approval, authorization
or permit of, or filing with or notification to, any governmental or
regulatory authority;
(f) any shares of the Company Common Stock acquired by
Parent upon exercise of the Option will be acquired for Parent's own
account, for investment purposes only and will not be, and the Option is
not being, acquired by Parent with a view to the public distribution
thereof, in violation of any applicable provision of the Securities Act.
7. CERTAIN REPURCHASES.
(a) Parent Put. At any time during which the Option is
exercisable pursuant to Section 2 hereof (the "Repurchase Period") provided
that the Company shall have consummated an Alternative Transaction, upon
demand by Parent, Parent shall have the right to sell to the Company (or
any successor entity thereof) and the Company (or such successor entity)
shall be obligated to repurchase from Parent (the "Put"), all or any
portion of the Option, at the price set forth in subparagraph (i) below, or
all or any portion of the Shares purchased by Parent pursuant to the
exercise of the Option, at a price set forth in subparagraph (ii) below:
(i) The difference between the "Market/Tender Offer
Price" for shares of the Company Common Stock as of the date
(the "Notice Date") notice of exercise of the Put, is given
to the Company (defined as the higher of (A) the price per
share offered as of the Notice Date pursuant to any tender
or exchange offer or other Alternative Transaction (as
defined in the Merger Agreement) which was made prior to the
Notice Date and not terminated or withdrawn as of the Notice
Date (the "Tender Price") and (B) the average of the closing
prices of shares of the Company Common Stock on the Nasdaq
National Market for the ten trading days immediately
preceding the Notice Date, (the "Market Price")), and the
Exercise Price, multiplied by the number of the Shares
purchasable pursuant to the Option (or portion thereof with
respect to which Parent is exercising its rights under this
Section 7), but only if the Market/Tender Offer Price is
greater than the Exercise Price. For purposes of determining
the highest price offered pursuant to any Alternative
Transaction which involves consideration other than cash,
the value of such consideration shall be equal to the higher
of (x) if securities of the same class of the proponent as
such consideration are traded on any national securities
exchange or by any registered securities association, a
value based on the closing sale price or asked price for
such securities on their principal trading market on such
date and (y) the value ascribed to such consideration by the
proponent of such Alternative Transaction, or if no such
value is ascribed, a value determined in reasonable good
faith by the Board of Directors of the Company.
(ii) The Exercise Price paid by Parent for the Shares
acquired pursuant to the exercise of the Option plus the
difference between the Market/Tender Offer Price and the
Exercise Price, but only if the Market/Tender Offer Price is
greater than the Exercise Price, multiplied by the number of
the Shares so purchased.
(iii) For purposes of clauses (i) and (ii) of this
Section 7(a), the Tender Price shall be the highest price
per share offered pursuant to a tender or exchange offer or
other Alternative Transaction during the Repurchase Period.
(b) Payment and Redelivery of the Option or Shares. In
the event Parent exercises its rights under this Section 7, the Company
shall, within ten business days of the Notice Date, pay the required amount
to Parent in immediately available funds and Parent shall surrender to the
Company the Option or the certificates evidencing the Shares purchased by
Parent pursuant thereto, and Parent shall warrant that it owns such shares
and that such shares are then free and clear of all liens, claims, charges
and encumbrances of any kind or nature whatsoever.
8. REGISTRATION RIGHTS.
(a) Following the termination of the Merger Agreement and
exercise of the Option, Parent may by written notice request the Company to
register for resale under the Securities Act all or any part of the Shares
beneficially owned by Parent (the "Registrable Securities"). The Company
shall use its reasonable best efforts to effect, as promptly as
practicable, the registration under the Securities Act of the Registrable
Securities; provided, however, that (i) Parent shall not be entitled to
demand more than an aggregate of two (2) effective registration statements
hereunder, and (ii) the Company will not be required to file any such
registration statement during any period of time (not to exceed sixty (60)
days after such request in the case of clause (A) below or ninety (90) days
after such request in the case of clauses (B) and (C) below) when (A) the
Registrant is in possession of material non-public information which it
reasonably believes would be detrimental to be disclosed at such time and,
in the opinion of counsel to the Company, such information would be
required to be disclosed if a registration statement were filed at that
time; (B) the Company is required under the Securities Act to include
audited financial statements for any period in such registration statement
and such financial statements are not yet available for inclusion in such
registration statement; or (C) the Company determines, in its reasonable
judgment, that such registration would interfere with any financing,
acquisition or other transaction involving the Company or any of its
material subsidiaries and that such transaction is material to the
Registrant and its subsidiaries taken as a whole.
(b) The Company shall use its reasonable best efforts to
cause any Registrable Securities registered pursuant to this Section 8 to
be qualified for sale under the securities or Blue Sky laws of such
jurisdictions as Parent may reasonably request and shall continue such
registration or qualification in effect in such jurisdiction; provided,
however, that the Company shall not be required to qualify to do business
in, or consent to general service of process in, any jurisdiction by reason
of this provision.
(c) The registration rights set forth in this Section 8
are subject to the condition that Parent shall provide the Company with
such information with respect to its Registrable Securities, the plans for
the distribution thereof, and such other information with respect to the
Parent as, in the reasonable judgment of counsel for the Company, is
necessary to enable the Registrant to include in such registration
statement all material facts required to be disclosed with respect to a
registration thereunder.
(d) A registration effected under this Section 8 shall be
effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to the Parent, and the
Registrant shall provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from auditors) as
is customary in connection with underwritten public offerings as such
underwriters may reasonably require.
(e) In connection with any registration effected under
this Section 8, the parties agree (i) to indemnify each other and the
underwriters, if any, in the customary manner, (ii) to enter into an
underwriting agreement in form and substance customary for transactions of
such type with the underwriters participating in such offering, if any, and
(iii) to take all further actions which shall be reasonably necessary to
effect such registration and sale (including if the managing underwriter
deems it necessary, participating in road-show presentations).
9. ADJUSTMENT UPON CHANGES IN CAPITALIZATION.
(a) In the event of any change in the Company Common
Stock by reason of stock dividends, splitups, mergers (other than the
Merger), recapitalizations, combinations, exchange of shares or the like,
the type and number of shares or securities subject to the Option, and the
purchase price per share provided in Section 2(e) hereof, shall be adjusted
appropriately, and proper provision shall be made in the agreements
governing such transaction so that Parent shall receive, upon exercise of
the Option, the number and class of shares or other securities or property
that Parent would have received in respect of the Company Common Stock if
the Option had been exercised immediately prior to such event or the record
date therefor, as applicable.
(b) In the event that the Company shall enter in an
agreement: (i) to consolidate with or merge into any person, other than
Parent or one of its Subsidiaries, and shall not be the continuing or
surviving corporation of such consolidation or merger; (ii) to permit any
person, other than Parent or one of its Subsidiaries, to merge into the
Company and the Company shall be the continuing or surviving corporation,
but, in connection with such merger, the then-outstanding shares of the
Company Common Stock shall be changed into or exchanged for stock or other
securities of the Company or any other person or cash or any other property
or the outstanding shares of the Company Common Stock immediately prior to
such merger shall after such merger represent less than 50% of the
outstanding shares and share equivalents of the merged company; or (iii) to
sell or otherwise transfer all or substantially all of its assets to any
person, other than Parent or one of its Subsidiaries, then, and in each
such case, the agreement governing such transaction shall make proper
provisions so that upon the consummation of any such transaction and upon
the terms and conditions set forth herein, Parent shall receive for each
the Share with respect to which the Option has not been exercised an amount
of consideration in the form of and equal to the per share amount of
consideration that would be received by the holder of one share of the
Company Common Stock less the Exercise Price (and, in the event of an
election or similar arrangement with respect to the type of consideration
to be received by the holders of the Company Common Stock, subject to the
foregoing, proper provision shall be made so that the holder of the Option
would have the same election or similar rights as would the holder of the
number of shares of the Company Common Stock for which the Option is then
exercisable).
10. LIMITATION OF PARENT PROFIT.
(a) Notwithstanding any other provision of this
Agreement, in no event shall Parent's Total Profit (as defined below)
exceed $6,000,000, including in such amount the fees payable under the
provisions of Section 7.2(b) of the Merger Agreement, and, if Parent's
Total Profit shall otherwise exceed such amount, Parent, at its sole
election, shall either (i) reduce the number of shares of Company Common
Stock subject to this Option, (ii) deliver to the Company for cancellation
Shares previously purchased by Parent (valued, for purposes of this Section
10(a) at the average closing sales price per share of Company Common Stock
(or if there is no sale on such date then the average between the closing
bid and ask prices on any such day) as quoted on the Nasdaq National Market
based on published financial sources for the twenty consecutive trading
days preceding the day on which Parent's Total Profit exceeds $6,000,000,
(iii) pay cash to the Company, or (iv) any combination thereof, such that
Parent's actually realized Total Profit shall not exceed $6,000,000 after
taking into account the foregoing actions.
(b) As used herein, the term "Total Profit" shall mean
the amount (before taxes) of the following: (a) the aggregate amount of
(i)(x) the net cash amounts received by Parent or its permitted designees
or any affiliated party pursuant to the sale of Shares (or any other
securities into which the Option is converted or exchanged) to any
unaffiliated party or to the Company pursuant to this Agreement, less (y)
Parent's or its permitted designees purchase price of such Shares, (ii) any
amounts received by Parent or its permitted designees or any affiliated
party on the transfer of the Option (or any portion thereof) to any
unaffiliated party or to the Company pursuant to this Agreement, and (iii)
any amounts received by Parent pursuant to Section 7.2(b) of the Merger
Agreement; minus (b) the amount of cash theretofore paid to the Company
pursuant to this Section 10 plus the value of the Shares theretofore
delivered to the Company for cancellation pursuant to this Section 10.
11. RESTRICTIVE LEGENDS. Each certificate representing
shares of the Company Common Stock issued to Parent hereunder shall include
a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE
REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE.
It is understood and agreed that (i) the reference to the
resale restrictions of the Securities Act and state securities or Blue Sky
laws in the foregoing legend shall be removed by delivery of substitute
certificate(s) without such reference if Parent shall have delivered to the
Company a copy of a letter from the staff of the Securities and Exchange
Commission, or an opinion of counsel, in form and substance reasonably
satisfactory to the Company, to the effect that such legend is not required
for purposes of the Securities Act or such laws; (ii) the reference to the
provisions of this Agreement in the foregoing legend shall be removed by
delivery of substitute certificate(s) without such reference if the shares
have been sold or transferred in compliance with the provisions of this
Agreement and under circumstances that do not require the retention of such
reference; and (iii) the legend shall be removed in its entirety if the
conditions in the preceding clauses (i) and (ii) are both satisfied. In
addition, such certificates shall bear any other legend as may be required
by law. Certificates representing shares sold in a registered public
offering pursuant to Section 8 shall not be required to bear the legend set
forth in this Section 11.
12. BINDING EFFECT; NO ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. Except as expressly provided
for in this Agreement, neither this Agreement nor the rights or the
obligations of either party hereto are assignable, except by operation of
law, or with the written consent of the other party. Nothing contained in
this Agreement, express or implied, is intended to confer upon any person
other than the parties hereto and their respective permitted assigns any
rights or remedies of any nature whatsoever by reason of this Agreement.
13. SPECIFIC PERFORMANCE. The parties recognize and agree that
if for any reason any of the provisions of this Agreement are not performed
in accordance with their specific terms or are otherwise breached,
immediate and irreparable harm or injury would be caused for which money
damages would not be an adequate remedy. Accordingly, each party agrees
that, in addition to other remedies, the other party shall be entitled to
an injunction restraining any violation or threatened violation of the
provisions of this Agreement. In the event that any action should be
brought in equity to enforce the provisions of this Agreement, neither
party will allege, and each party hereby waives the defense, that there is
adequate remedy at law.
14. ENTIRE AGREEMENT. This Agreement, the Merger Agreement, and
the other Ancillary Agreements constitute the entire agreement among the
parties with respect to the subject matter hereof and supersede all other
prior agreements and understandings, both written and oral, among the
parties or any of them with respect to the subject matter hereof.
15. FURTHER ASSURANCE. Each party will execute and deliver
all such further documents and instruments and take all such further
action as may be necessary in order to consummate the transactions contemplated
hereby.
16. VALIDITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability
of the other provisions of this Agreement, which shall remain in full force
and effect. In the event any court or other competent authority holds any
provision of this Agreement to be null, void or unenforceable, the parties
hereto shall negotiate in good faith the execution and delivery of an
amendment to this Agreement in order, as nearly as possible, to effectuate,
to the extent permitted by law, the intent of the parties hereto with
respect to such provision. Each party agrees that, should any court or
other competent authority hold any provision of this Agreement or part
hereof to be null, void or unenforceable, or order any party to take any
action inconsistent herewith, or not take any action required herein, the
other party shall not be entitled to specific performance of such provision
or part hereof or to any other remedy, including but not limited to money
damages, for breach hereof or of any other provision of this Agreement or
part hereof as the result of such holding or order.
17. NOTICES. Any notice or communication required or permitted
hereunder shall be in writing and either delivered personally, telegraphed or
telecopied or sent by certified or registered mail, postage prepaid, and
shall be deemed to be given, dated and received when so delivered
personally, telegraphed or telecopied or, if mailed, five business days
after the date of mailing to the following address or facsimile number, or
to such other address or addresses as such person may subsequently
designate by notice given hereunder.
(a) if to Parent, to:
Tumbleweed Communications Corp.
000 Xxxxxxx Xxxxx
Xxxxxxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxxxxxxx Xxxxxx - Xxxxx 000
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
(b) if to the Company, to:
Worldtalk Communications Corporation
0000 Xxx Xxxxxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
with a copy to:
Fenwick & West LLP
Xxx Xxxx Xxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
18. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without
giving effect to the principles of conflicts of law thereof.
19. DESCRIPTIVE HEADINGS. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part
of or to affect the meaning or interpretation of this Agreement.
20. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same instrument.
21. EXPENSES. Except as otherwise expressly provided herein or
in the Merger Agreement, all costs and expenses incurred in connection with
the transactions contemplated by this Agreement shall be paid by the party
incurring such expenses.
22. AMENDMENTS; WAIVER. This Agreement may be amended by the
parties hereto and the terms and conditions hereof may be waived only by an
instrument in writing signed on behalf of each of the parties hereto, or,
in the case of a waiver, by an instrument signed on behalf of the party
waiving compliance.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized officers as of
the date first above written.
Worldtalk Communications Corporation
By:___________________________________
Name: Xxxxx Xxxxxx
Title: Vice President, CFO
Tumbleweed Communications Corp.
By: __________________________________
Name: Xxxxxxx X. Xxxxx
Title: Chief Executive Officer
