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AGREEMENT AND PLAN OF REORGANIZATION
BY AND AMONG
OLICOM A/S,
PW ACQUISITION CORPORATION
AND
CROSSCOMM CORPORATION
MARCH 20, 1997
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TABLE OF CONTENTS
Page
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ARTICLE I THE MERGER........................................................ 1
1.1 The Merger................................................. 1
1.2 Closing; Effective Time.................................... 1
1.3 Effect of the Merger....................................... 2
1.4 Certificate of Incorporation; Bylaws....................... 2
1.5 Directors and Officers..................................... 2
1.6 Effect on Capital Stock.................................... 2
1.7 Dissenting Shares. ........................................ 5
1.8 Surrender of Certificates.................................. 5
1.9 No Further Ownership Rights in CrossComm Common Stock...... 7
1.10 Lost, Stolen or Destroyed Certificates..................... 7
1.11 Taking of Necessary Action; Further Action................. 7
ARTICLE II REPRESENTATIONS AND WARRANTIES OF CROSSCOMM...................... 8
2.1 Organization, Standing and Power........................... 8
2.2 Capital Structure.......................................... 8
2.3 Authority................................................. 10
2.4 Governmental Authorization................................ 10
2.5 SEC Documents............................................. 11
2.6 Financial Statements...................................... 11
2.7 Absence of Certain Changes................................ 12
2.8 Absence of Undisclosed Liabilities........................ 12
2.9 Litigation................................................ 12
2.10 Restrictions on Business Activities....................... 12
2.11 Title to Property......................................... 13
2.12 Intellectual Property..................................... 13
2.13 Environmental Matters..................................... 15
2.14 Taxes..................................................... 15
2.15 Employee Benefit Plans.................................... 16
2.16 Employee Matters.......................................... 19
2.17 Certain Agreements........................................ 20
2.18 Compliance With Laws...................................... 20
2.19 Customers and Suppliers................................... 20
2.20 Brokers' and Finders' Fees................................ 20
2.21 Registration Statement; Joint Proxy Statement/Prospectus.. 20
2.22 Opinion of Financial Advisor.............................. 21
2.23 Vote Required............................................. 21
2.24 Board Approval............................................ 21
2.25 Section 203 of Delaware Law Not Applicable................ 22
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ARTICLE III REPRESENTATIONS AND WARRANTIES OF OLICOM AND
MERGERSUB....................................................... 22
3.1 Organization, Standing and Power.......................... 22
3.2 Capital Structure......................................... 22
3.3 Authority................................................. 23
3.4 Governmental Authorization................................ 24
3.5 SEC Documents............................................. 25
3.6 Financial Statements...................................... 25
3.7 Absence of Certain Changes................................ 25
3.8 Absence of Undisclosed Liabilities........................ 26
3.9 Litigation................................................ 26
3.10 Restrictions on Business Activities....................... 26
3.11 Title to Property......................................... 26
3.12 Intellectual Property..................................... 27
3.13 Environmental Matters..................................... 27
3.14 Taxes..................................................... 28
3.15 Employee Benefit Plans.................................... 28
3.16 Employee Matters.......................................... 30
3.17 Certain Agreements........................................ 30
3.18 Compliance With Laws...................................... 30
3.19 Brokers' and Finders' Fees................................ 30
3.20 Registration Statement; Joint Proxy Statement/Prospectus.. 31
3.21 Opinion of Financial Advisor.............................. 31
3.22 Vote Required............................................. 31
3.23 Board Approval............................................ 31
ARTICLE IV CONDUCT PRIOR TO THE EFFECTIVE TIME............................. 32
4.1 Conduct of Business of CrossComm and Olicom............... 32
4.2 Conduct of Business of CrossComm.......................... 33
4.3 No Solicitation........................................... 35
ARTICLE V ADDITIONAL AGREEMENTS............................................ 37
5.1 Joint Proxy Statement/Prospectus; Registration Statement.. 37
5.2 Meetings of Stockholders.................................. 38
5.3 Access to Information; Advice of Changes.................. 39
5.4 Confidentiality........................................... 39
5.5 Public Disclosure......................................... 40
5.6 Consents; Cooperation..................................... 40
5.7 Affiliate Agreements...................................... 40
5.8 Voting Agreements......................................... 41
5.9 Legal Requirements........................................ 41
5.10 Blue Sky Laws............................................. 41
5.11 Employee Benefit Plans.................................... 41
5.12 Letter of Olicom's and CrossComm's Accountants............ 43
5.13 Directorship.............................................. 43
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5.14 Form S-8.................................................. 43
5.15 Indemnification........................................... 44
5.16 Listing of Additional Shares, Warrants and Warrant Shares. 45
5.17 Best Efforts and Further Assurances....................... 45
ARTICLE VI CONDITIONS TO THE MERGER........................................ 45
6.1 Conditions to Obligations of Each Party to Effect the
Merger.................................................... 45
6.2 Additional Conditions to Obligations of CrossComm......... 47
6.3 Additional Conditions to the Obligations of Olicom and
MergerSub................................................. 48
ARTICLE VII TERMINATION, AMENDMENT AND WAIVER.............................. 49
7.1 Termination............................................... 49
7.2 Effect of Termination..................................... 51
7.3 Expenses and Termination Fees............................. 51
7.4 Amendment................................................. 53
7.5 Extension; Waiver......................................... 53
ARTICLE VIII DEFINITIONS................................................... 54
8.1 Defined Terms............................................. 54
ARTICLE IX GENERAL PROVISIONS.............................................. 55
9.1 Non-Survival at Effective Time............................ 55
9.2 Notices................................................... 55
9.3 Interpretation............................................ 56
9.4 Counterparts.............................................. 56
9.5 Entire Agreement; Nonassignability; Parties in Interest... 56
9.6 Severability.............................................. 57
9.7 Remedies Cumulative....................................... 57
9.8 Governing Law............................................. 57
9.9 Rules of Construction..................................... 57
EXHIBITS
Exhibit A - Certificate of Merger
Exhibit B - Form of Warrant Certificate
Exhibit C - CrossComm Affiliates Agreement
Exhibit D - Voting Agreement - CrossComm Affiliates
Exhibit E - Voting Agreement - Olicom Affiliates
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AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made and
entered into as of March 20, 1997, by and among Olicom A/S, a corporation
organized under the laws of the Kingdom of Denmark ("Olicom"), PW Acquisition
Corporation, a corporation organized under the laws of the State of Delaware and
wholly-owned subsidiary of Olicom ("MergerSub"), and CrossComm Corporation, a
corporation organized under the laws of the State of Delaware ("CrossComm").
The Boards of Directors of CrossComm, Olicom and MergerSub believe it is
in the best interests of their respective companies and the stockholders of
their respective companies that CrossComm and MergerSub combine into a single
company through the statutory merger, pursuant to the Delaware General
Corporation Law, as amended ("Delaware Law"), of MergerSub with and into
CrossComm (the "Merger") and, in furtherance thereof, have approved the Merger.
Pursuant to the Merger, among other things, each outstanding share of
common stock in CrossComm, par value $0.01 per share ("CrossComm Common Stock"),
shall be exchanged for the Merger Consideration (as defined in Section 1.6(b)).
CrossComm, Olicom and MergerSub desire to make certain representations and
warranties and other agreements in connection with the Merger.
Concurrent with the execution and delivery of this Agreement and as an
inducement to Olicom and MergerSub to enter into this Agreement, certain
affiliates of CrossComm and Olicom have on the date hereof entered into an
agreement to vote the shares of capital stock in CrossComm and Olicom, as the
case may be, owned by such persons to approve the Merger and against any
competing proposals.
NOW, THEREFORE, in consideration of the covenants and representations set
forth herein, and for other good and valuable consideration, the parties agree
as follows:
ARTICLE I
THE MERGER
1.1 The Merger. At the Effective Time (as defined in Section 1.2) and
subject to and upon the terms and conditions of this Agreement, the Certificate
of Merger attached hereto as Exhibit A (the "Certificate of Merger") and the
applicable provisions of Delaware Law, MergerSub shall be merged with and into
CrossComm, the separate corporate existence of MergerSub shall cease and
CrossComm shall continue as the surviving corporation (CrossComm, as the
surviving corporation subsequent to the Merger, is hereinafter sometimes
referred to as the "Surviving Corporation").
1.2 Closing; Effective Time. The closing of the transactions contemplated
hereby (the "Closing") shall take place (i) no later than the second business
day after satisfaction of the latest to occur of the conditions set forth in
Sections 6.1, 6.2(b) (other
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than the delivery of the officers' certificates referred to therein) and 6.3(b)
(other than the delivery of the officers' certificates referred to therein)
(provided that the other closing conditions set forth in Article VI have been
met or waived as provided in Article VI at or prior to the Closing), or (ii) at
such other time no later than June 30, 1997, as the parties hereto agree (the
"Closing Date"). The Closing shall take place at the offices of Liddell, Sapp,
Zivley, Hill & XxXxxx, L.L.P., 0000 Xxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxx, or at
such other location as the parties hereto agree. In connection with the Closing,
the parties hereto shall cause the Merger to be consummated by filing the
Certificate of Merger with the Secretary of State of Delaware and with the
Recorder of the county in which the registered office of each of CrossComm and
MergerSub is located, in accordance with the relevant provisions of Delaware Law
(the time of such filing being referred to herein as the "Effective Time").
1.3 Effect of the Merger. At the Effective Time, the effect of the Merger
shall be as provided in this Agreement, the Certificate of Merger and the
applicable provisions of Delaware Law. Without limiting the generality of the
foregoing, and subject thereto, at the Effective Time all of the property,
rights, privileges, powers and franchises of CrossComm and MergerSub shall vest
in the Surviving Corporation, and all debts, liabilities and duties of CrossComm
and MergerSub shall become the debts, liabilities and duties of the Surviving
Corporation.
1.4 Certificate of Incorporation; Bylaws.
(a) At the Effective Time, the Certificate of Incorporation of
MergerSub, as in effect immediately prior to the Effective Time, shall be the
Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided by Delaware Law and such Certificate of Incorporation;
provided, however, that Article I of the Certificate of Incorporation of the
Surviving Corporation shall be amended to read as follows: "The name of the
corporation is CrossComm Corporation."
(b) The bylaws of MergerSub, as in effect immediately prior to the
Effective Time, shall be the bylaws of the Surviving Corporation until
thereafter amended.
1.5 Directors and Officers. At the Effective Time, the directors and
officers of the Surviving Corporation shall be the initial directors and
officers of MergerSub, until their respective successors are duly elected or
appointed and qualified.
1.6 Effect on Capital Stock. By virtue of the Merger and without any
action on the part of MergerSub, CrossComm or the holders of any of the
following securities:
(a) Prior to the Effective Time, Surviving Corporation and/or the
Exchange Agent (as defined in Section 1.8(a)) each shall be authorized to take
all actions that either of them may deem necessary or desirable to effect the
transfer of the Merger
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Consideration (as defined in Section 1.6(b)) to the holders of CrossComm Common
Stock and the contribution of the Surviving Corporation Stock to Olicom. Upon
and after the approval of this Agreement by the CrossComm stockholders,
CrossComm shall be authorized to take all such actions that it may deem
necessary or desirable to effect the transfer of the Merger Consideration to the
holders of CrossComm Common Stock, including the preparation, filing and
delivery of the subscription list required under the Companies Act of the
Kingdom of Denmark (the "Companies Act") in order to effect the delivery of the
Olicom Common Stock (as defined in Section 1.6(b)) to be delivered pursuant to
this Agreement. At the Effective Time, (i) each share of CrossComm Common Stock
issued and outstanding immediately prior to the Effective Time (other than any
shares of CrossComm Common Stock to be canceled pursuant to Section 1.6(d) and
Dissenting Shares (as defined in Section 1.7(a)) shall be exchanged for the
Merger Consideration, and (ii) that number of shares of Surviving Corporation
Stock that is equal to the number of shares of CrossComm Common Stock (other
than any shares of CrossComm Common Stock to be canceled pursuant to Section
1.6(d)) and the Dissenting Shares shall be contributed to Olicom (the "Surviving
Corporation Stock").
(b) At the Effective Time, each holder of a share of CrossComm
Common Stock shall be entitled only to receive upon surrender of each such share
of CrossComm Common Stock (i) 0.2667 shares of common stock in Olicom, nominal
value DKK 0.25 per share ("Olicom Common Stock") (the "Exchange Ratio"), (ii)
the sum of $5.00 in cash, and (iii) three-year warrants (each a "Warrant") to
purchase 0.1075 shares (the "Warrant Exchange Ratio") of Olicom Common Stock at
an exercise price of $19.74 per share (clauses (i), (ii) and (iii) are
collectively referred to as the "Merger Consideration"). Each such Warrant shall
contain the terms and provisions substantially as set forth in Exhibit B.
Notwithstanding the foregoing, (x) in the event that the average of the high and
low sales prices of a share of Olicom Common Stock for the ten trading days
immediately preceding (but excluding) the fifth trading day before the CrossComm
Stockholders' Meeting (as defined in Section 2.21), as reported on the Nasdaq
National Market (the "Final Closing Price"), is less than $12.50, Olicom shall
have the right to increase the Exchange Ratio to the number which, when
multiplied by the Final Closing Price, equals $3.33 (and if Olicom shall not so
increase the Exchange Ratio, CrossComm shall have the right to terminate this
Agreement pursuant to Section 7.1(i)); and (y) in the event that the Final
Closing Price is more than $20.83, Olicom shall have the right to decrease the
Exchange Ratio to the number which, when multiplied by the Final Closing Price,
equals $5.56 (and if Olicom so decreases the Exchange Ratio, CrossComm shall
have the right to terminate this Agreement pursuant to Section 7.1(i)). In the
event that the Final Closing Price triggers the provisions of clauses (x) or (y)
and Olicom desires to exercise its rights hereunder to increase or decrease the
Exchange Ratio, as the case may be, Olicom shall notify CrossComm of any such
increase or decrease, as the case may be, no later than 3:00 p.m., Dallas time,
on the fifth trading day prior to the date of the CrossComm Stockholders'
Meeting by telephone followed by telecopied confirmation thereof.
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(c) The Exchange Ratio and the Warrant Exchange Ratio shall be
adjusted to reflect fully the effect of any stock split, reverse split, stock
dividend (including any dividend or distribution of securities convertible into
Olicom Common Stock or CrossComm Common Stock), reorganization, recapitalization
or other like change with respect to Olicom Common Stock or CrossComm Common
Stock occurring after the date hereof and prior to the Effective Time.
Information regarding any adjustments to the Exchange Ratio and the Warrant
Exchange Ratio shall be made available by Olicom and CrossComm to their
respective stockholders through the use of a 1-800 phone number prior to the
CrossComm Stockholders' Meeting (as defined in Section 2.21) and Olicom
Stockholders' Meeting (as defined in Section 3.20).
(d) At the Effective Time, all shares of CrossComm Common Stock
that are owned by CrossComm as treasury stock, and each share of CrossComm
Common Stock owned by Olicom or any direct or indirect wholly-owned subsidiary
of Olicom or of CrossComm immediately prior to the Effective Time, shall be
canceled and extinguished without any conversion thereof.
(e) At or prior to the Effective Time and upon approval of the
Agreement by the stockholders of CrossComm, the Exchange Agent (as defined in
Section 1.8(a)) and/or CrossComm shall deliver to Olicom a duly executed
subscription list relating to the subscription for the Olicom Common Stock
included in the Merger Consideration, such subscription list to be in compliance
with the requirements of the Companies Act and in a form reasonably acceptable
to Olicom.
(f) At the Effective Time, the CrossComm Option Plans (as defined
in Section 8.1) and all options to purchase CrossComm Common Stock then
outstanding under the CrossComm Option Plans shall be assumed by Olicom in
accordance with Section 5.11.
(g) At the Effective Time, each share of common stock, par value
$0.01 per share, of MergerSub ("MergerSub Common Stock"), issued and outstanding
immediately prior to the Effective Time shall be cancelled and extinguished
without any exchange thereof.
(h) No fraction of a share of Olicom Common Stock shall be issued,
but in lieu thereof each holder of a share of CrossComm Common Stock who would
otherwise be entitled to a fraction of a share of Olicom Common Stock (after
aggregating all fractional shares of Olicom Common Stock to be received by such
holder) shall receive from Olicom an amount in cash (rounded to the nearest
whole cent) equal to the product of (i) such fraction, multiplied by (ii) the
Final Closing Price. No fraction of a Warrant shall be issued, but in lieu
thereof each holder of a Warrant who would otherwise be entitled to a fraction
of a Warrant (after aggregating all fractional Warrants
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to be received by such holder) shall receive from Olicom an amount of cash
(rounded to the nearest whole cent) equal to the product of (i) such fraction,
multiplied by (ii) the Warrant Unit Consideration (as defined in Section
5.11(a)).
1.7 Dissenting Shares.
(a) For purposes of this Agreement, "Dissenting Shares" means
shares of CrossComm Common Stock held as of the Effective Time by a stockholder
of record of CrossComm who has not voted such shares of CrossComm Common Stock
in favor of the Merger and with respect to which appraisal rights shall have
been duly demanded and perfected in accordance with Section 262 of Delaware Law
and not effectively withdrawn or forfeited prior to the Effective Time.
Dissenting Shares shall not be exchanged into or represent the right to receive
the consideration which the holders of CrossComm Common Stock are entitled to
receive pursuant to Section 1.6(a) or (b) unless the holder thereof shall have
forfeited his or her right to appraisal under Delaware Law or withdrawn, with
the consent of CrossComm, his or her demand for appraisal. If such stockholder
has so forfeited or withdrawn his or her right to appraisal of Dissenting
Shares, then, as of the occurrence of such event, such holder's Dissenting
Shares shall cease to be Dissenting Shares and shall be converted into and
represent the right to receive the Merger Consideration pursuant to Section
1.6(a).
(b) CrossComm shall give Olicom (i) prompt notice of any written
demands for appraisal of any shares of CrossComm Common Stock, withdrawals of
such demands, and any other instruments that relate to such demands received by
CrossComm, and (ii) the opportunity to direct all negotiations and proceedings
with respect to demands for appraisal under Delaware Law. CrossComm shall not,
except with the prior consent of Olicom, make any payment with respect to any
demands for appraisal of shares of CrossComm Common Stock or offer to settle or
settle any such demands.
1.8 Surrender of Certificates.
(a) American Stock Transfer & Trust Company shall act as exchange
agent (the "Exchange Agent") in the Merger.
(b) Promptly after the Effective Time, Olicom shall make available
to the Exchange Agent for exchange in accordance with this Article I, through
such reasonable procedures as Olicom may adopt, (i) the shares of Olicom Common
Stock and Warrants issuable, and cash payable, pursuant to Section 1.6(b) in
exchange for the Surviving Corporation Stock, and (ii) cash in an amount
sufficient to permit payment of cash in lieu of fractional shares and fractional
Warrants pursuant to Section 1.6(h) (collectively, the "Exchange Fund").
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(c) Promptly after the Effective Time (but in no event more than
five business days), the Surviving Corporation shall cause the Exchange Agent to
mail to each holder of record of a certificate or certificates (the
"Certificates") of CrossComm Common Stock, (i) a letter of transmittal in form
reasonably acceptable to Olicom and CrossComm (which shall specify that delivery
shall be effected, and risk of loss and title to the Certificates shall pass,
only upon receipt of the Certificates by the Exchange Agent, and shall be in
such form and have such other provisions as Olicom may reasonably specify), and
(ii) instructions for use in effecting the surrender of the Certificates and
obtaining delivery of whole shares of Olicom Common Stock and Warrants, and the
cash portion of the Merger Consideration (together with cash in lieu of
fractional shares of Olicom Common Stock and fractional Warrants). Upon
surrender of a Certificate for cancellation to the Exchange Agent, together with
such letter of transmittal, duly completed and validly executed in accordance
with the instructions thereto, the holder of such Certificate shall be entitled
to receive certificates evidencing the number of whole shares of Olicom Common
Stock, the number of whole Warrants, the cash portion of the Merger
Consideration, and payment in lieu of fractional shares of Olicom Common Stock
and fractional Warrants which such holder has the right to receive pursuant to
Section 1.6. Until so surrendered, (i) each outstanding Certificate for shares
of CrossComm Common Stock shall be deemed from and after the Effective Time
other than the payment of dividends, to evidence for all corporate purposes
(including the right to vote at meetings of Olicom's stockholders), the number
of whole shares of Olicom Common Stock, the number of whole Warrants, the cash
portion of the Merger Consideration for which such shares of CrossComm Common
Stock shall have been so exchanged, and the right to receive an amount in cash
in lieu of the issuance of any fractional shares of Olicom Common Stock or
fractional Warrants in accordance with Section 1.6. No interest will be paid or
accrued on any amount payable or due on the surrender of the Certificates.
(d) No dividends or other distributions with respect to Olicom
Common Stock with a record date after the Effective Time shall be paid to the
holder of any unsurrendered Certificate until the holder of record of such
Certificate shall surrender such Certificate. Subject to applicable law,
following surrender of any such Certificate, there shall be paid to the record
holder of the certificates representing whole shares of Olicom Common Stock
issued in exchange therefor, without interest, at the time of such surrender,
the amount of any such dividends or other distributions with a record date after
the Effective Time theretofore payable (but for the provisions of this Section
1.8(d)) with respect to such shares of Olicom Common Stock.
(e) If any certificate for shares of Olicom Common Stock or any
certificate evidencing Warrants is to be issued in a name other than that in
which the Certificate originally surrendered with respect thereto is registered,
it shall be a condition of the issuance thereof that the Certificate so
surrendered shall be properly endorsed, and otherwise be in proper form for
transfer, and that the person requesting such exchange shall have paid to Olicom
or any agent designated by it any transfer or other
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taxes required by reason of the issuance of a certificate for shares of Olicom
Common Stock or Warrants in any name other than that of the registered holder of
the Certificate originally surrendered, or shall have established to the
satisfaction of Olicom or any agent designated by it that such tax has been paid
or is not payable.
(f) Any portion of the Exchange Fund which remains undistributed to
the stockholders of CrossComm for 180 days after the Effective Time shall be
delivered to Olicom, upon demand, and any stockholders of CrossComm who have not
previously complied with this Section 1.8 shall thereafter look only to Olicom
for payment of their claim for Merger Consideration (including any cash in lieu
of fractional shares of Olicom Common Stock or fractional Warrants, and any
dividends or distributions with respect to Olicom Common Stock.
(g) Notwithstanding anything to the contrary in this Section 1.8,
none of the Exchange Agent, the Surviving Corporation or any party hereto shall
be liable to any person for any amount properly paid to a public official
pursuant to any applicable abandoned property, escheat or similar law.
1.9 No Further Ownership Rights in CrossComm Common Stock. All shares of
Olicom Common Stock and Warrants issued, together with the cash portion of the
Merger Consideration paid, upon the surrender of a Certificate in accordance
with the terms hereof (including any cash paid in lieu of fractional shares of
Olicom Common Stock or fractional Warrants) shall be deemed to have been issued
and paid in full satisfaction of all rights received with respect thereto, and
there shall be no further registration of transfers on the records of the
Surviving Corporation of shares of CrossComm Common Stock which were outstanding
immediately prior to the Effective Time. If, after the Effective Time,
Certificates are presented to the Surviving Corporation for any reason, they
shall be canceled and exchanged as provided in this Article I.
1.10 Lost, Stolen or Destroyed Certificates. In the event that any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall
issue and pay in exchange for such lost, stolen or destroyed Certificates, upon
the making of an affidavit of that fact by the holder thereof, such shares of
Olicom Common Stock, Warrants and the cash portion of the Merger Consideration
(and cash in lieu of fractional shares of Olicom Common Stock and Warrants) as
may be required pursuant to Section 1.6; provided, however, that Olicom may, in
its discretion and as a condition precedent to the issuance thereof, require the
owner of such lost, stolen or destroyed Certificates to deliver a bond in such
sum as it may reasonably direct as indemnity against any claim that may be made
against Olicom, the Surviving Corporation or the Exchange Agent with respect to
the Certificates alleged to have been lost, stolen or destroyed.
1.11 Taking of Necessary Action; Further Action. If, at any time after the
Effective Time, any further action is necessary or desirable to carry out the
purposes of this Agreement and to vest the Surviving Corporation with full
right, title and
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possession to all assets, property, rights, privileges, powers and franchises of
CrossComm and MergerSub, the officers and directors of CrossComm and MergerSub
are fully authorized in the name of their respective corporations or otherwise
to take, and shall take, all such lawful and necessary action, so long as such
action is not inconsistent with this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF CROSSCOMM
Except as disclosed in a document of even date herewith delivered by
CrossComm to Olicom prior to the execution and delivery of this Agreement and
referring to the representations and warranties in this Agreement (the
"CrossComm Disclosure Letter"), CrossComm represents and warrants to Olicom and
MergerSub as follows:
2.1 Organization, Standing and Power. Each of CrossComm and its
subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization. Each of CrossComm
and its subsidiaries has the corporate power to own its properties and to carry
on its business as now being conducted and is duly qualified to do business and
is in good standing in each jurisdiction in which the failure to be so qualified
and in good standing would have a Material Adverse Effect (as defined in Section
8.1) on CrossComm and its subsidiaries, taken as a whole, or on CrossComm-Poland
Ltd. ("CrossComm - Poland"), or on CrossComm (UK) Ltd. ("CrossComm (UK)").
CrossComm has delivered to Olicom a true and correct copy of its amended and
restated certificate of incorporation, as amended (the "Certificate of
Incorporation"), bylaws, as amended (the "Bylaws"), or equivalent charter or
organizational documents, as applicable, of CrossComm and each of its
subsidiaries, each as amended to date. Neither CrossComm nor any of its
subsidiaries is in violation of any of the provisions of its Certificate of
Incorporation, Bylaws or equivalent charter or organizational documents.
2.2 Capital Structure.
(a) The authorized capital stock of CrossComm, as of March 14,
1997, consisted of 20,000,000 shares of CrossComm Common Stock and 4,000,000
shares of preferred stock, par value $0.01 per share, of which there were issued
and outstanding 9,284,584 shares of CrossComm Common Stock and no shares of
preferred stock, and no shares were held in the treasury of CrossComm. As of
March 14, 1997, there were no other outstanding shares of capital stock or
voting securities of CrossComm. All outstanding shares of CrossComm Common Stock
are duly authorized, validly issued, fully paid and non-assessable and are free
of any liens or encumbrances other than any liens or encumbrances created by or
imposed upon the holders thereof, and are not subject to preemptive rights
(contractual or otherwise) or rights of first refusal created
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by statute, the Certificate of Incorporation, the Bylaws or any agreement to
which CrossComm is a party or by which it is bound.
(b) As of March 14, 1997, there were unexercised options to
purchase 1,796,465 shares of CrossComm Common Stock that had been granted to
employees and directors and were outstanding pursuant to the CrossComm Option
Plans. Since March 14, 1997, CrossComm has not (i) issued or granted additional
options under the CrossComm Option Plans, or (ii) accepted enrollments in the
CrossComm 1995 Employee Stock Purchase Plan (the "CrossComm ESPP"). All shares
of CrossComm Common Stock subject to issuance as set forth above, upon issuance
on the terms and conditions specified in the instruments pursuant to which they
are issuable, shall be duly authorized, validly issued, fully paid and
nonassessable. Except for the rights created pursuant to this Agreement, the
CrossComm Option Plans and the CrossComm ESPP, there are no other options,
warrants, calls, rights, commitments or agreements of any character to which
CrossComm is a party or by which it is bound obligating CrossComm to issue,
deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold,
repurchased or redeemed, any shares of capital stock of CrossComm or obligating
CrossComm to grant, extend, accelerate the vesting of, change the price of, or
otherwise amend or enter into any such option, warrant, call, right, commitment
or agreement. There are no contracts, commitments or agreements relating to
voting, purchase or sale of CrossComm's capital stock (i) between or among
CrossComm and any of its stockholders, and (ii) to CrossComm's knowledge,
between or among any of CrossComm's stockholders, except for the stockholder
named in Section 5.8(a) of the CrossComm Disclosure Letter. The current
"Offering" (as defined in the CrossComm ESPP) commenced under the CrossComm ESPP
on January 1, 1997 and will end as provided in Section 5.11(c), and except for
the purchase rights granted on such commencement date to participants in the
current Offering, there are no other purchase rights or options outstanding
under the CrossComm ESPP. True and complete copies of all agreements and
instruments relating to or issued under the CrossComm Option Plans or CrossComm
ESPP have been made available to Olicom, and such agreements and instruments
have not been amended, modified or supplemented, and there are no agreements to
amend, modify or supplement such agreements or instruments in any case from the
form thereof made available to Olicom.
(c) CrossComm is the owner of all outstanding shares of capital
stock of each of its subsidiaries, and all such shares are duly authorized,
validly issued, fully paid and nonassessable and free of preemptive rights. All
of the outstanding shares of capital stock of each such subsidiary are owned by
CrossComm free and clear of all liens, charges, claims or encumbrances or rights
of others. There are no outstanding subscriptions, options, warrants, puts,
calls, rights, exchangeable or convertible securities or other commitments or
agreements of any character relating to the issued or unissued capital stock or
other securities of any such subsidiary, or otherwise obligating CrossComm or
any such subsidiary to issue, transfer, sell, purchase, redeem or otherwise
acquire any such securities.
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14
(d) Except as disclosed in the CrossComm SEC Documents (as defined
in Section 2.5), CrossComm does not directly or indirectly own any equity or
similar interest in, or any interest convertible or exchangeable or exercisable
for, any equity or similar interest in, any corporation, partnership, joint
venture or other business association or entity.
2.3 Authority. CrossComm has all requisite corporate power and authority
to execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary corporate action on the part of CrossComm, subject only to the
approval of the Merger by CrossComm's stockholders as contemplated by Section
6.1(a)(i). This Agreement has been duly executed and delivered by CrossComm and
constitutes the valid and binding obligation of CrossComm enforceable against
CrossComm in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
principles of equity. The execution and delivery of this Agreement by CrossComm
do not and, except for any required approval by CrossComm's stockholders as set
forth in Section 2.23, the consummation of the transactions contemplated hereby
will not, conflict with, or result in any violation of, or default under (with
or without notice or lapse of time, or both), or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of any
benefit under, (i) any provision of the Certificate of Incorporation or Bylaws
or equivalent organizational documents of any of CrossComm's subsidiaries, as
amended, or (ii) any mortgage or indenture, or material lease, contract or other
agreement or instrument, permit, concession, franchise, license, judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to
CrossComm or any of its subsidiaries or any of their properties or assets,
except where such conflict, violation, default, termination, cancellation or
acceleration with respect to the foregoing provisions of clause (ii) is not
reasonably likely to have a Material Adverse Effect on CrossComm or such
subsidiary, as the case may be.
2.4 Governmental Authorization. CrossComm and each of its subsidiaries
have obtained each federal, state, county, local or foreign governmental
consent, license, permit, grant or other authorization that is required for the
operation of CrossComm's or any of its subsidiaries' businesses (collectively,
the "CrossComm Authorizations"), and all of such CrossComm Authorizations are in
full force and effect, except where the failure to obtain or maintain any of
such CrossComm Authorizations would not have a Material Adverse Effect on
CrossComm and its subsidiaries, taken as a whole. No consent, approval, order or
authorization of, or registration, declaration or filing with, any court,
administrative agency or commission or other governmental authority or
instrumentality (each, a "Governmental Entity") is required by or, to the
knowledge of CrossComm, with respect to, CrossComm or any of its subsidiaries in
connection with the execution and delivery of this Agreement or the consummation
of the transactions contemplated hereby, except for (i) the filing of the
Certificate of Merger as provided in
- 10 -
15
Section 1.2, (ii) the filing with the Securities and Exchange Commission (the
"Commission") and Nasdaq of the Joint Proxy Statement (as defined in Section
2.21) relating to the CrossComm Stockholders' Meeting, (iii) other filings under
the Securities Act of 1933, as amended (the "Securities Act"), and the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), (iv) such
consents, approvals, orders, authorizations, registrations, declarations and
filings as may be required under applicable state securities laws and the
securities laws of any foreign country, (v) such filings as may be required
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended
("HSR"), and (vi) such other consents, authorizations, filings, approvals and
registrations which, if not obtained or made, would have a Material Adverse
Effect on CrossComm and its subsidiaries, taken as a whole, and would prevent,
or materially alter or delay any of the transactions contemplated by this
Agreement.
2.5 SEC Documents. CrossComm has made available to Olicom a true and
complete copy of each notice, information statement, report, schedule,
registration statement and definitive proxy statement (including exhibits
thereto) filed with the Commission by CrossComm since December 31, 1995; and
prior to the Effective Time, CrossComm will have furnished Olicom with true and
complete copies of any additional documents filed with the Commission by
CrossComm after such date and prior to the Effective Time (collectively, the
"CrossComm SEC Documents"). All documents required to be filed as exhibits to
the CrossComm SEC Documents have been so filed. As of their respective filing
dates, the CrossComm SEC Documents complied in all material respects with the
requirements of the Securities Act or the Exchange Act, as the case may be, and
none of the CrossComm SEC Documents contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements made therein, in light of the circumstances in
which they were made, not misleading, except to the extent corrected by a
subsequently-filed CrossComm SEC Document.
2.6 Financial Statements. CrossComm has furnished to Olicom true, complete
and accurate copies of CrossComm's unaudited consolidated financial statements
at and for the fiscal year ended December 31, 1996, which financial statements
include, among other things, the consolidated balance sheet of CrossComm at
December 31, 1996, and the related consolidated statements of income (loss) and
cash flows for the period then ended (such financial statements are collectively
referred to herein as the "CrossComm 1996 Financial Statement"). The
consolidated financial statements of CrossComm, together with, in each case, the
notes thereto, included in the CrossComm SEC Documents and the CrossComm 1996
Financial Statement (collectively, the "CrossComm Financial Statements")
complied or will comply as to form in all material respects with applicable
accounting requirements, to the extent filed with the Commission, with the
published rules and regulations of the Commission with respect thereto as of
their respective dates, and have been prepared in accordance with generally
accepted accounting principles applied on a basis consistent throughout the
periods indicated and consistent with each other ("GAAP") (except as may be
indicated in the notes thereto or,
- 11 -
16
in the case of unaudited statements included in Quarterly Reports on Form 10-Q,
as permitted by Form 10-Q promulgated by the Commission). The CrossComm
Financial Statements fairly present or will present the consolidated financial
condition and operating results of CrossComm and its subsidiaries at the dates
and during the periods indicated therein (subject, in the case of unaudited
statements, to normal, recurring year-end adjustments which were not and are not
expected to be material in amount) in all material respects. All reserves
established by CrossComm with respect to its assets are adequate.
2.7 Absence of Certain Changes. Since December 31, 1996 (the "CrossComm
Balance Sheet Date"), CrossComm has conducted its business in the ordinary
course consistent with past practice, and there has not occurred: (i) to the
date hereof, any change, event or condition (whether or not covered by
insurance) that would result in a Material Adverse Effect to CrossComm or any of
its subsidiaries, taken as a whole; (ii) an event described in Sections 4.1 (as
to CrossComm) or 4.2(c), (e), (f) (as to subclause (i)), (g), (i), (l)-(n) or
(p); or (iii) any negotiation or agreement by CrossComm or any of its
subsidiaries to do any of the things described in the preceding clauses (i) or
(ii) (other than negotiations with Olicom and its representatives regarding the
transactions contemplated by this Agreement).
2.8 Absence of Undisclosed Liabilities. CrossComm has no material
obligations or liabilities of any nature (matured or unmatured, fixed or
contingent) other than (i) those set forth or adequately provided for in the
balance sheet included in the CrossComm 1996 Financial Statement (the "CrossComm
Balance Sheet"), (ii) those not required to be set forth in the CrossComm
Balance Sheet under GAAP, (iii) those incurred in the ordinary course of
business since the CrossComm Balance Sheet Date and consistent with past
practice, and (iv) those incurred in connection with the execution and delivery
of this Agreement.
2.9 Litigation. There is no private or governmental action, suit,
proceeding, claim, arbitration or investigation pending before any agency, court
or tribunal, foreign or domestic, or, to the knowledge of CrossComm or any of
its subsidiaries, threatened against CrossComm or any of its subsidiaries or any
of their respective properties that is reasonably likely, individually or in the
aggregate, to have a Material Adverse Effect (i) on CrossComm and its
subsidiaries, taken as a whole, (ii) on CrossComm-Poland or (iii) on CrossComm
(UK).
2.10 Restrictions on Business Activities. There is no agreement, judgment,
injunction, order or decree binding upon CrossComm or any of its subsidiaries
which has the effect or is reasonably likely to have the effect of prohibiting
or materially impairing the conduct of business by CrossComm or any of its
subsidiaries as currently conducted by any of them. Section 2.10 of the
CrossComm Disclosure Letter contains a true and complete list or brief
description of any agreements or arrangements restricting CrossComm's ability to
compete in the marketplace, and any joint venture
- 12 -
17
contract or arrangement or any other agreement which involves or is expected to
involve a sharing of profits with other persons.
2.11 Title to Property. Neither CrossComm nor any of its subsidiaries own
any real property. CrossComm and its subsidiaries have good and valid title to
all of their respective personal property acquired after the CrossComm Balance
Sheet Date (except personal property sold or otherwise disposed of since the
CrossComm Balance Sheet Date in the ordinary course of business), or in the case
of leased personal properties and assets, valid leasehold interests therein,
free and clear of all mortgages, liens, pledges, charges or encumbrances of any
kind or character, except (i) the lien of current taxes not yet due and payable,
(ii) such imperfections of title, liens and easements as do not and will not
materially detract from or interfere with the use of the properties subject
thereto or affected thereby, or otherwise materially impair business operations
involving such properties, (iii) liens securing debt which is reflected on the
CrossComm Balance Sheet, or (iv) those which would not have a Material Adverse
Effect on CrossComm and its subsidiaries, taken as a whole. The plants, property
and equipment of CrossComm and its subsidiaries that are used in the operations
of their businesses are in good operating condition and repair, reasonable wear
and tear excepted. All properties used in the operations of CrossComm and its
subsidiaries are reflected in the CrossComm Balance Sheet to the extent GAAP
requires the same to be reflected. Section 2.11 of the CrossComm Disclosure
Letter identifies each parcel of real property owned or leased by CrossComm or
any of its subsidiaries.
2.12 Intellectual Property.
(a) To its knowledge, CrossComm and its subsidiaries own, or are
licensed or otherwise possess legally enforceable rights to use, all patents,
trademarks, trade names, service marks, copyrights, and any applications
therefor, maskworks, net lists, schematics, technology, know-how, trade secrets,
inventory, ideas, algorithms, processes, computer software programs or
applications (in both source code and object code form), and tangible or
intangible proprietary information or material (collectively, "Intellectual
Property") that are used in or necessary to conduct the business of CrossComm
and its subsidiaries as currently conducted.
(b) Section 2.12 of the CrossComm Disclosure Letter lists (i) all
patents and patent applications and all registered and unregistered trademarks,
trade names and service marks (registered and unregistered), copyright
registrations and maskwork registrations, which CrossComm considers to be
material to its business or that of any subsidiary and included in the
Intellectual Property of CrossComm, including the jurisdictions in which each
such Intellectual Property right has been issued or registered or in which any
application for such issuance and registration has been filed, (ii) all
licenses, sublicenses, distribution and original equipment manufacturer
agreements, and other agreements as to which CrossComm is a party and pursuant
to which any person is authorized to use any Intellectual Property of CrossComm
or has the right to
- 13 -
18
manufacture, reproduce, market or exploit any CrossComm product or any
adaptation, translation or derivative work based on a CrossComm product or any
portion thereof, (iii) all material licenses, sublicenses and other agreements
as to which CrossComm or its subsidiaries is a party and pursuant to which
CrossComm is authorized to use any third party patents, trademarks or
copyrights, including software (collectively, "Third Party Intellectual Property
Rights"), which are used in the manufacture of, incorporated in, or form a part
of any product that is material to the business of CrossComm and any of its
subsidiaries, taken as a whole, and (iv) all material joint development
agreements to which CrossComm or any of its subsidiaries is a party.
(c) To CrossComm's knowledge, there is no unauthorized use,
disclosure, infringement or misappropriation of any Intellectual Property rights
of CrossComm or any of its subsidiaries, any trade secret material to CrossComm
or any of its subsidiaries, or any Third Party Intellectual Property Right to
the extent licensed by or through CrossComm or any of its subsidiaries, by any
third party, including any employee or former employee of CrossComm or any of
its subsidiaries. Neither CrossComm nor any of its subsidiaries has entered into
any agreement to indemnify any other person against any charge of infringement
of any Intellectual Property, other than indemnification provisions contained in
purchase orders or customer agreements arising in the ordinary course of
business, copies of which have been made available to Olicom.
(d) CrossComm is not, nor will it be as a result of the execution
and delivery of this Agreement or the performance of its obligations pursuant
hereto, in breach of any license, sublicense or other agreement relating to any
Intellectual Property or Third Party Intellectual Property Rights, the breach of
which would have or would be reasonably likely to have a Material Adverse Effect
on CrossComm and its subsidiaries, taken as a whole.
(e) To CrossComm's knowledge, all patents, registered trademarks,
registered service marks and copyright registrations held by CrossComm are valid
and subsisting. Neither CrossComm nor any of its subsidiaries (i) is a party to
any suit, action or proceeding which involves a claim of infringement of any
patents, trademarks, service marks, copyrights or violation of any trade secret
or other proprietary right of any third party, or (ii) has brought any action,
suit or proceeding for infringement of Intellectual Property or breach of any
license or agreement involving Intellectual Property against any third party. To
CrossComm's knowledge, the manufacture, marketing, licensing or sale of
CrossComm's products do not infringe any patent, trademark, service xxxx,
copyright, trade secret or other proprietary right of any third party.
(f) CrossComm has a policy to secure valid written assignments from
all consultants and employees who contribute or have contributed to the creation
or development of Intellectual Property of the rights to such contributions that
CrossComm does not already own by operation of law. All use, disclosure or
appropriation of
- 14 -
19
proprietary and confidential information ("Confidential Information") owned by
CrossComm by or to a third party has been pursuant to the terms of a written
agreement between CrossComm (or a subsidiary of CrossComm) and such third party.
All use, disclosure or appropriation of Confidential Information not owned by
CrossComm has been pursuant to the terms of a written agreement between
CrossComm (or a subsidiary of CrossComm) and the owner of such Confidential
Information, or is otherwise lawful.
2.13 Environmental Matters. CrossComm and each of its subsidiaries (i)
have obtained all applicable applications, exemptions, permits, licenses,
registrations, identification numbers, notices of intent, and other
authorizations ("Environmental Permits") that are required for the ownership,
use, or operation of their facilities (and equipment and structures thereon) to
comply with applicable laws relating to health, pollution, protection of the
environment or a community's right to know, including laws, rules, regulations,
orders, consent agreements of any foreign, federal, state or local executive,
legislative judicial, regulatory or administrative agency ("Environmental Laws")
relating to emissions, discharges, releases (or threatened releases) of
pollutants, contaminants, solid wastes, or hazardous or toxic substances,
materials or wastes ("Materials of Environmental Concern") into the environment,
including ambient air, surface water, ground water or land or otherwise relating
to the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern by CrossComm or its
subsidiaries (or their respective agents), and (ii) are in compliance with all
terms and conditions of such Environmental Permits, and also are in compliance
with all terms and conditions of such Environmental Permits, and also are in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
such Environmental Laws or contained in any judicial or administrative judgment
or decision arising thereunder, except where such failure to comply is not
reasonably likely to have a Material Adverse Effect on CrossComm and its
subsidiaries, taken as a whole.
2.14 Taxes. CrossComm and each of its subsidiaries have timely filed all
Tax Returns (as defined in this Section 2.14) required to be filed by any of
them, have paid all Taxes (as defined in this Section 2.14) shown thereon to be
due and have provided adequate accruals in accordance with GAAP in its financial
statements for any Taxes that have not been paid, whether or not shown as being
due on any Tax Returns. Except as disclosed in the CrossComm Disclosure Letter,
(i) no material claim for Taxes has become a lien against the property of
CrossComm or any of its subsidiaries or is being asserted against CrossComm or
any of its subsidiaries, other than liens for Taxes not yet due and payable,
(ii) no audit of any Tax Return of CrossComm or any of its subsidiaries is being
conducted by a Tax Authority (as defined in this Section 2.14), (iii) no
extension of the statute of limitations on the assessment of any Taxes has been
granted to CrossComm or any of its subsidiaries and is currently in effect, and
(iv) there is no agreement, contract or arrangement to which CrossComm or any of
its subsidiaries
- 15 -
20
is a party that may result in the payment of any amount that would not be
deductible by reason of Sections 280G or 404 of the Internal Revenue Code of
1986, as amended (the "Code"). CrossComm has not been and will not be required
to include any material adjustment in Taxable income for any Tax period (or
portion thereof) pursuant to Sections 481 or 263A of the Code or any comparable
provision under state or foreign Tax laws as a result of transactions, events or
accounting methods employed by CrossComm or any of its subsidiaries prior to the
Merger. Neither CrossComm nor any of its subsidiaries is a party to any tax
sharing or tax allocation agreement, nor does CrossComm or any of its
subsidiaries owe any amount under any such agreement(s). For purposes of this
Agreement, the following terms have the following meanings: "Tax" (and, with
correlative meaning, "Taxes" and "Taxable") means (x) any net income,
alternative or add-on minimum tax, gross income, gross receipts, sales, use, ad
valorem, transfer, franchise, profits, license, withholding, payroll,
employment, excise, severance, stamp, occupation, premium, property,
environmental or windfall profit tax, custom, duty or other tax, governmental
fee or other like assessment or charge of any kind whatsoever, together with any
interest or any penalty, addition to tax or additional amount imposed by any
Governmental Entity (a "Tax Authority") responsible for the imposition of any
such tax (domestic or foreign), (y) any liability for the payment of any amounts
of the type described in clause (x) as a result of being a member of an
affiliated, consolidated, combined or unitary group for any Taxable period, and
(z) any liability for the payment of any amounts of the type described in
clauses (x) or (y) as a result of any express or implied obligation to indemnify
any other person. As used herein, "Tax Return" means any return, statement,
report or form (including estimated Tax returns and reports, withholding Tax
returns and reports and information reports and returns required to be filed
with respect to Taxes). CrossComm and each of its subsidiaries are in full
compliance with all terms and conditions of any Tax exemptions or other
Tax-sharing agreement or order of a foreign government, and the consummation of
the Merger shall not have any adverse effect on the continued validity and
effectiveness of any such Tax exemptions or other Tax-sharing agreement or
order.
2.15 Employee Benefit Plans.
(a) Section 2.15 of the CrossComm Disclosure Letter lists, with
respect to CrossComm, any United States subsidiary of CrossComm and any trade or
business (whether or not incorporated) which is treated as a single employer
with CrossComm (an "ERISA Affiliate") within the meaning of Sections 414(b),
(c), (m) or (o) of the Code, (i) all employee benefit plans (as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), subject to ERISA, (ii) each loan to a non-officer employee, loans to
officers and directors and any stock option, stock purchase, phantom stock or
stock appreciation right, (iii) all supplemental retirement, severance,
sabbatical, medical, dental, vision care, disability, employee relocation,
cafeteria benefit (Code Section 125) or dependent care (Code Section 129), life
insurance or accident insurance, bonus, pension, profit sharing, savings,
deferred compensation or incentive plans, programs or arrangements which are not
employee benefit plans as
- 16 -
21
otherwise covered under clause (i) above, (iv) other fringe or employee benefit
plans, programs or arrangements that apply to senior management of CrossComm and
that do not generally apply to all employees, and (v) any current or former
employment, executive compensation or severance agreements, written or
otherwise, as to which unsatisfied obligations of CrossComm of greater than
$25,000 remain for the benefit of, or relating to, any present or former
employee, consultant or director of CrossComm, but excluding any plan or
arrangement maintained or sponsored by any non-domestic entity (collectively,
the "CrossComm Employee Plans").
(b) CrossComm has furnished or made available to Olicom a copy of
each of the CrossComm Employee Plans and related plan documents (including trust
documents, insurance policies or contracts, employee booklets, summary plan
descriptions and other authorizing documents, and, to the extent still in its
possession, any material employee communications relating thereto) and has, with
respect to each CrossComm Employee Plan which is subject to ERISA reporting
requirements, provided copies of the Form 5500 reports filed for the last three
plan years. Any CrossComm Employee Plan intended to be qualified under Section
401(a) of the Code has either obtained from the Internal Revenue Service a
favorable determination letter as to its qualified status under the Code,
including all amendments to the Code effected by the Tax Reform Act of 1986 and
subsequent legislation, or has applied to the Internal Revenue Service for such
a determination letter prior to the expiration of the requisite period under
applicable Treasury Regulations or Internal Revenue Service pronouncements in
which to apply for such determination letter and to make any amendments
necessary to obtain a favorable determination. CrossComm has also furnished or
made available to Olicom the most recent Internal Revenue Service determination
letter issued with respect to each such CrossComm Employee Plan, and nothing has
occurred since the issuance of each such letter which could reasonably be
expected to cause the loss of the tax-qualified status of any CrossComm Employee
Plan subject to Code Section 401(a).
(c) Except as disclosed in Section 2.15(c) of the CrossComm
Disclosure Letter, (i) other than continued health care coverage required under
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA")
or applicable law, (x) none of the CrossComm Employee Plans promises or provides
retiree medical or other retiree or post termination welfare benefits to any
person, (y) each CrossComm Employee Plan may be amended or terminated at any
time without any liability to CrossComm or any ERISA Affiliate other than for
benefits accrued through the date of such termination, and each such plan
provides the administrator with the discretion to interpret and construe the
terms of the plan; (ii) there has been no "prohibited transaction," as such term
is defined in Section 406 of ERISA and Section 4975 of the Code, with respect to
any CrossComm Employee Plan which is reasonably likely to have a Material
Adverse Effect on CrossComm; (iii) each CrossComm Employee Plan is in material
compliance with the requirements prescribed by all statutes, rules and
regulations (including ERISA and the Code) and has been administered in all
material
- 17 -
22
respects in accordance with its terms and in material compliance with the
requirements prescribed by any and all statutes, rules and regulations
(including ERISA and the Code), and CrossComm and each subsidiary or ERISA
Affiliate have performed all obligations required to be performed by them under,
are not in any respect in material default under or material violation of, and
have no knowledge of any material default or material violation by any other
party to, any of the CrossComm Employee Plans; (iv) neither CrossComm nor any
subsidiary or ERISA Affiliate is subject to any liability or penalty under
Sections 4976 through 4980 of the Code or Title I of ERISA with respect to any
of the CrossComm Employee Plans which is reasonably likely to have a Material
Adverse Effect on CrossComm; (v) all contributions required to be made by
CrossComm or any subsidiary or ERISA Affiliate to any CrossComm Employee Plan
have been made on or before their due dates, and a reasonable amount has been
accrued for contributions to each CrossComm Employee Plan for the current plan
year; (vi) with respect to each CrossComm Employee Plan, no "reportable event"
within the meaning of Section 4043 of ERISA (excluding any such event for which
the 30 day notice requirement has been waived under the regulations to Section
4043 of ERISA) nor any event described in Sections 4062, 4063 or 4041 of ERISA
has occurred; and (vii) no CrossComm Employee Plan is covered by, and neither
CrossComm nor any subsidiary or ERISA Affiliate has incurred or expects to incur
any liability under, Title IV of ERISA or Section 412 of the Code. With respect
to each CrossComm Employee Plan subject to ERISA as either an employee pension
plan within the meaning of Section 3(2) of ERISA or an employee welfare benefit
plan within the meaning of Section 3(1) of ERISA, CrossComm has prepared in good
faith and timely filed all required governmental reports (which were true and
correct as of the date filed), and CrossComm has properly and timely filed and
distributed or posted all notices and reports to employees required to be filed,
distributed or posted with respect to each such CrossComm Employee Plan. No
suit, administrative proceeding, action or other litigation has been brought, or
to the knowledge of CrossComm, is threatened, against or with respect to any
such CrossComm Employee Plan, including any audit or inquiry by the Internal
Revenue Service or Department of Labor, and no event (other than routine claims
for benefits) has occurred and no set of circumstances have occurred in
connection with any CrossComm Employee Plan for which CrossComm or any of its
affiliates or subsidiaries could be subject to any material liability. Neither
CrossComm nor any of its subsidiaries or other ERISA Affiliate is a party to, or
has made any contribution to or otherwise incurred any obligation under, any
"multiemployer plan," as defined in Section 3(37) of ERISA. No CrossComm
Employee Plan is funded through a "welfare benefit fund" (as such term is
defined in Code Section 419(e) of the Code). Except as disclosed in Section
2.15(c) of the CrossComm Disclosure Letter, no CrossComm Employee Plan is a
"multiple employer welfare arrangement" (as defined by Section 3(40) of ERISA).
(d) With respect to each CrossComm Employee Plan, CrossComm and
each of its United States subsidiaries have complied in all material respects
with (i) the applicable health care continuation and notice provisions of COBRA
and the proposed
- 18 -
23
regulations thereunder, (ii) the applicable requirements of the Family Leave Act
of 1993 and the regulations thereunder and (iii) Section 609 of ERISA.
(e) Except as described in Section 2.15(e) of the CrossComm
Disclosure Letter, the consummation of the transactions contemplated by this
Agreement will not (i) entitle any current or former employee or other service
provider of CrossComm, any CrossComm subsidiary or any other ERISA Affiliate to
severance benefits or any other payment, (ii) accelerate the time of payment or
vesting, or increase the amount of compensation due any such employee or service
provider, or (iii) require payments (whether in cash or property or the vesting
of property) to any employee, officer or director of CrossComm or any ERISA
Affiliate who is a "disqualified individual" (as such term is defined in
Proposed Treasury Regulation Section 1.280G-1) that could be characterized as a
"excess parachute payment" (as such term is defined in Section 280G(b)(1) of the
Code).
(f) There has been no amendment to, written interpretation or
announcement (whether or not written) by CrossComm, any CrossComm subsidiary or
other ERISA Affiliate relating to, or change in participation or coverage under,
any CrossComm Employee Plan which would materially increase the expense of
maintaining such Plan above the level of expense incurred with respect to that
Plan for the most recent fiscal year included in CrossComm's financial
statements.
(g) All voluntary employee benefit associations related to the
CrossComm Employee Plans have been submitted to and approved as exempt from
federal income tax under Section 501(c)(9) of the Code by the Internal Revenue
Service and have not been amended or operated in a manner which would adversely
affect such exempt status. All voluntary employee benefit associations related
to the CrossComm Employee Plans have been submitted to and approved as exempt
from federal income tax under Section 501(c)(9) of the Code by the Internal
Revenue Service and have not been amended or operated in a manner which would
adversely affect such exempt status.
(h) Except as disclosed in Section 2.15(h) of the CrossComm
Disclosure Letter, there are no guaranteed investment contracts, annuity
contracts or other funding contracts with any insurance company that are held by
any CrossComm Employee Plan. Except as set forth on Section 2.15 of the
CrossComm Disclosure Letter, no CrossComm Employee Plan covers persons employed
outside the United States, and no such Plan is subject to the laws of a foreign
jurisdiction.
2.16 Employee Matters. CrossComm and each of its subsidiaries are in
compliance in all respects with all currently applicable laws and regulations
respecting employment, discrimination in employment, terms and conditions of
employment, wages, hours and occupational safety and health and employment
practices, and are not engaged in any unfair labor practice, except where the
failure to be in compliance or the
- 19 -
24
engagement in such unfair labor practices would not have a Material Adverse
Effect on CrossComm and its subsidiaries, taken as a whole. Neither CrossComm
nor any of its subsidiaries has any obligations under COBRA with respect to any
former employees or qualifying beneficiaries thereunder, except for obligations
that would not have a Material Adverse Effect on CrossComm and its subsidiaries,
taken as a whole. Neither CrossComm nor any of its subsidiaries is a party to
any collective bargaining agreement or other labor union contract, nor does
CrossComm nor any of its subsidiaries know of any activities or proceedings of
any labor union to organize any such employees.
2.17 Certain Agreements. Section 2.17 of the CrossComm Disclosure Letter
lists all material contracts to which CrossComm or any of its subsidiaries is a
party (each, a "CrossComm Material Contract"). CrossComm has made available to
Olicom all CrossComm Material Contracts.
2.18 Compliance With Laws. Each of CrossComm and its subsidiaries has
complied with, is not in violation of, and has not received any notices of
violation with respect to, any applicable statute, law or regulation with
respect to the conduct of its business, or the ownership or operation of its
business, except for such violations or failures to comply as would not have a
Material Adverse Effect on CrossComm and its subsidiaries, taken as a whole.
2.19 Customers and Suppliers. Section 2.19 of the CrossComm Disclosure
Letter sets forth a list of CrossComm's customers with whom CrossComm, as of the
date hereof, is contractually obligated to supply CrossComm products or services
aggregating more than $250,000 (collectively, "Continuing Customers"). No
Continuing Customer has indicated to CrossComm or any of its subsidiaries that
it will stop, or materially decrease the rate of, buying services or products of
CrossComm or such subsidiary, nor has at any time on or after January 1, 1997,
decreased materially its purchases of the services or products of CrossComm or
such subsidiary. No supplier of sole source or limited source products,
components or assemblies to CrossComm or any of its subsidiaries has indicated
that it will stop, or materially decrease the rate of, supplying, such products,
components or assemblies to CrossComm or any of its subsidiaries. CrossComm has
not knowingly breached, so as to provide a benefit to CrossComm or such
subsidiary that was not intended by the parties, any agreement with any customer
or supplier of CrossComm or any of its subsidiaries.
2.20 Brokers' and Finders' Fees. Except for payment obligations to
Xxxxxxxxxx Securities disclosed to Olicom, CrossComm has not incurred, nor will
it incur, directly or indirectly, any liability for brokerage or finders' fees
or agents' commissions or investment bankers' fees in connection with this
Agreement or any transaction contemplated hereby.
2.21 Registration Statement; Joint Proxy Statement/Prospectus. The
information supplied by CrossComm for inclusion in the registration statement on
Form F-4 (or such
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other or successor form as shall be appropriate) pursuant to which the shares of
Olicom Common Stock, the Rights and the Warrants to be issued in the Merger,
together with the Warrant Shares (as defined in Section 3.2(b)), will be
registered with the Commission (the "Registration Statement") shall not at the
time the Registration Statement (including any amendments or supplements
thereto) is declared effective by the Commission contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The information
supplied by CrossComm for inclusion in the proxy statement/prospectus to be sent
to the stockholders of CrossComm in connection with the meeting of CrossComm's
stockholders to consider the Merger (the "CrossComm Stockholders' Meeting")
(such proxy statement/prospectus, as amended or supplemented, is referred to
herein as the "Joint Proxy Statement") shall not, on the date the Joint Proxy
Statement is first mailed to CrossComm's stockholders, at the time of the
CrossComm Stockholders' Meeting or the Olicom Stockholders' Meeting, and at the
Effective Time, contain any statement which, at such time, is false or
misleading with respect to any material fact, or omit to state any material fact
necessary in order to make the statements made therein, in light of the
circumstances under which they are made, not false or misleading; or omit to
state any material fact necessary to correct any statement in any earlier
communication with respect to the solicitation of proxies for the CrossComm
Stockholders' Meeting or the Olicom Stockholders' Meeting which has become false
or misleading. If at any time prior to the Effective Time any event or
information should be discovered by CrossComm which should be set forth in an
amendment to the Registration Statement or a supplement to the Joint Proxy
Statement, CrossComm shall promptly inform Olicom and MergerSub. Notwithstanding
the foregoing, CrossComm makes no representation, warranty or covenant with
respect to any information supplied by Olicom or MergerSub which is contained in
any of the foregoing documents.
2.22 Opinion of Financial Advisor. CrossComm has been advised in writing
by its financial advisor, Xxxxxxxxxx Securities, that in such advisor's opinion,
as of the date hereof, the consideration to be received by the stockholders of
CrossComm is fair, from a financial point of view, to the stockholders of
CrossComm.
2.23 Vote Required. The affirmative vote of the holders of a majority of
the shares of CrossComm Common Stock outstanding on the record date set for the
CrossComm Stockholders' Meeting is the only vote of the holders of any of
CrossComm's capital stock necessary to approve this Agreement and the
transactions contemplated hereby.
2.24 Board Approval. The Board of Directors of CrossComm (the "CrossComm
Board") has, prior to the execution and delivery hereof, unanimously (i)
approved this Agreement and the Merger, (ii) determined that the Merger is in
the best interests of the stockholders of CrossComm and is on terms that are
fair to such stockholders, and
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(iii) determined to recommend that the stockholders of CrossComm approve this
Agreement and the consummation of the Merger.
2.25 Section 203 of Delaware Law Not Applicable. The CrossComm Board has
taken all actions so that the restrictions contained in Section 203 of Delaware
Law applicable to a "business combination" (as defined in Section 203 of the
Delaware Law) will not apply to the execution, delivery or performance of this
Agreement, the consummation of the Merger or the other transactions contemplated
by this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF OLICOM AND MERGERSUB
Except as disclosed in a document of even date herewith and delivered by
Olicom to CrossComm prior to the execution and delivery of this Agreement and
referring to the representations and warranties in this Agreement (the "Olicom
Disclosure Letter"), Olicom and MergerSub represent and warrant to CrossComm as
follows:
3.1 Organization, Standing and Power. Each of Olicom and its subsidiaries,
including MergerSub, is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization. Each of Olicom
and its subsidiaries has the corporate power to own its properties and to carry
on its business as now being conducted and is duly qualified to do business and
is in good standing in each jurisdiction in which the failure to be so qualified
and in good standing would have a Material Adverse Effect on Olicom and its
subsidiaries, taken as a whole. Olicom has delivered to CrossComm a true and
correct copy of its articles of association, as amended (the "Articles of
Association"), and rules of procedure, as amended (the "Rules of Procedure").
Neither Olicom nor any of its subsidiaries is in violation of any of the
provisions of its Articles of Association or Rules of Procedure or equivalent
organizational documents.
3.2 Capital Structure.
(a) The authorized capital stock of Olicom, as of March 14, 1997,
consisted of 15,938,000 shares of Olicom Common Stock, of which there were
issued and outstanding 14,734,000 shares, and 1,204,000 shares were held in the
treasury of Olicom. As of March 14, 1997, there are no other outstanding shares
of capital stock or voting securities of Olicom. The authorized capital stock of
MergerSub as of March 14, 1997, consisted of 1,000 shares of MergerSub Common
Stock, all of which were issued and outstanding and held by Olicom. All
outstanding shares of Olicom and MergerSub have been duly authorized, validly
issued, fully paid and are nonassessable and free of any liens or encumbrances,
other than any liens or encumbrances created by or imposed upon the holders
thereof.
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(b) As of March 14, 1997, there were unexercised options and
warrants to purchase 663,200 shares of Olicom Common Stock that had been granted
to employees and directors and were outstanding pursuant to the Olicom Share
Incentive Plans (as defined in Section 8.1). Except for (i) the rights created
pursuant to this Agreement, and (ii) options that may be granted pursuant to an
Olicom Share Incentive Plan by Olicom subsequent to the date hereof, there are
no other options, warrants, calls, rights, commitments or agreements of any
character to which Olicom or MergerSub is a party or by which either of them is
bound obligating Olicom or MergerSub to issue, deliver, sell, repurchase or
redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any
shares of the capital stock of Olicom or MergerSub or obligating Olicom or
MergerSub to grant, extend or enter into any such option, warrant, call, right,
commitment or agreement. The shares of Olicom Common Stock to be issued pursuant
to the Merger will be duly authorized, validly issued, fully paid, and
non-assessable and free of preemptive rights. The Warrants to be issued pursuant
to the Merger will be duly authorized, validly issued and fully paid, and the
shares of Olicom Common Stock issuable on exercise of the Warrants to which they
relate (the "Warrant Shares"), will be duly authorized, validly issued, fully
paid, and nonassessable and free of preemptive rights.
(c) Olicom is the owner of all outstanding shares of capital stock
of each of its subsidiaries, and all such shares are duly authorized, validly
issued, fully paid and nonassessable. All of the outstanding shares of capital
stock of each such subsidiary are owned by Olicom free and clear of all liens,
charges, claims or encumbrances or rights of others. There are no outstanding
subscriptions, options, warrants, puts, calls, rights, exchangeable or
convertible securities or other commitments or agreements of any character
relating to the issued or unissued capital stock or other securities of any such
subsidiary, or otherwise obligating Olicom or any such subsidiary to issue,
transfer, sell, purchase, redeem or otherwise acquire any such securities.
(d) Except as disclosed in the Olicom SEC Documents (as defined in
Section 3.5), Olicom does not directly or indirectly own any equity or similar
interest in, or any interest convertible or exchangeable or exercisable for, any
equity or similar interest in, any corporation, partnership, joint venture or
other business association or entity.
3.3 Authority. Olicom and MergerSub have all requisite corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on the part of Olicom and
MergerSub, subject to the approval of the Merger by Olicom's stockholders as
contemplated by Section 6.1(a)(ii). This Agreement has been duly executed and
delivered by Olicom and MergerSub and constitutes the valid and binding
obligations of Olicom and MergerSub enforceable against Olicom and MergerSub, as
the case may be, in accordance with its terms, subject
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to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and general principles of equity. The execution and delivery of this Agreement
do not and, except for any required approval by Olicom's stockholders as set
forth in Section 3.22 and the authorization of the Board of Directors of Olicom
to increase the share capital of Olicom for the purposes of providing Olicom
Common Stock for exchange as the Merger Consideration, the consummation of the
transactions contemplated hereby will not, conflict with, or result in any
violation of, or default under (with or without notice or lapse of time, or
both), or give rise to a right of termination, cancellation or acceleration of
any obligation or loss of a benefit under, (i) any provision of the Articles of
Association or Rules of Procedure or equivalent organizational documents of any
of Olicom's subsidiaries, as amended, or (ii) any mortgage or indenture, or
material lease, contract or other agreement or instrument, permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to Olicom or any of its subsidiaries or their properties
or assets, except where such conflict, violation, default, termination,
cancellation or acceleration with respect to the foregoing provisions of clause
(ii) is not reasonably likely to have a Material Adverse Effect on Olicom.
3.4 Governmental Authorization. Olicom and each of its subsidiaries have
obtained each federal, state, county, local or foreign governmental consent,
license, permit, grant, or other authorization that is required for the
operation of Olicom's or any of its subsidiaries' businesses (collectively, the
"Olicom Authorizations"), and all of such Olicom Authorizations are in full
force and effect, except where the failure to obtain or maintain any of such
Olicom Authorizations would not have a Material Adverse Effect on Olicom and its
subsidiaries, taken as a whole. No consent, approval, order or authorization of,
or registration, declaration or filing with, any Governmental Entity, is
required by or, to the knowledge of Olicom, with respect to Olicom or any of its
subsidiaries in connection with the execution and delivery of this Agreement by
Olicom and MergerSub or the consummation by Olicom and MergerSub of the
transactions contemplated hereby, except for (i) the filing of the Certificate
of Merger as provided in Section 1.2, (ii) the filing with the Commission and
NARD of the Registration Statement, (iii) other filings under the Securities Act
or the Exchange Act, (iv) any filings as may be required under applicable state
securities laws and the securities laws of any foreign country, (v) such filings
as may be required under HSR, (vi) the filing with the Nasdaq National Market of
a Notification Form for Listing of Additional Shares with respect to the
Warrants, the Warrant Shares, the shares of Olicom Common Stock issuable upon
the exchange of the CrossComm Common Stock in the Merger and upon exercise of
the options under the CrossComm Option Plans assumed by Olicom, and (vii) such
other consents, authorizations, filings, approvals and registrations which, if
not obtained or made, would have a Material Adverse Effect on Olicom and its
subsidiaries, taken as a whole, and would prevent or materially alter or delay
any of the transactions contemplated by this Agreement.
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3.5 SEC Documents. Olicom has made available to CrossComm a true and
complete copy of each notice, information statement, report, schedule,
registration statement and definitive proxy statement filed with the Commission
by Olicom since December 31, 1995; and prior to the Effective Time, Olicom will
have furnished CrossComm with true and complete copies of any additional
documents filed with the Commission by Olicom after such date and prior to the
Effective Time (collectively, the "Olicom SEC Documents"). All documents
required to be filed as exhibits to the Olicom SEC Documents have been so filed.
As of their respective filing dates, the Olicom SEC Documents complied in all
material respects with the requirements of the Exchange Act or the Securities
Act, as the case may be, and none of the Olicom SEC Documents contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements made therein, in light
of the circumstances in which they were made, not misleading, except to the
extent corrected by a subsequently-filed Olicom SEC Document.
3.6 Financial Statements. Olicom has furnished to CrossComm true, complete
and accurate copies of Olicom's consolidated unaudited financial statements at
and for the fiscal year ended December 31, 1996, which financial statements
include, among other things, the consolidated balance sheet of Olicom at
December 31, 1996, and the related consolidated statements of income and cash
flows for the period then ended (such financial statements are collectively
referred to herein as the "Olicom 1996 Financial Statement"). The consolidated
financial statements of Olicom, together with, in each case, the notes thereto,
included in the Olicom SEC Documents and the Olicom 1996 Financial Statement
(collectively, the "Olicom Financial Statements") complied or will comply as to
form in all material respects with applicable accounting requirements and, to
the extent filed with the Commission, with the published rules and regulations
of the Commission with respect thereto as of their respective dates, and have
been prepared in accordance with GAAP (except as may be indicated in the notes
thereto or, in the case of unaudited statements included in its Reports on Form
6-K, subject to normal, recurring year-end adjustments). The Olicom Financial
Statements fairly present or will present the consolidated financial condition
and operating results of Olicom and its subsidiaries at the dates and during the
periods indicated therein (subject, in the case of unaudited statements, to
normal, recurring year-end adjustments which were not and are not expected to be
material in amount) in all material respects. All reserves established by Olicom
with respect to its assets are adequate.
3.7 Absence of Certain Changes. Since December 31, 1996 (the "Olicom
Balance Sheet Date"), Olicom has conducted its business in the ordinary course
consistent with past practice, and there has not occurred: (i) any change, event
or condition (whether or not covered by insurance) that would result in a
Material Adverse Effect to Olicom; (ii) an event described in Section 4.1 (as to
Olicom); or (iii) any negotiation or agreement by Olicom or any of its
subsidiaries to do any of the things described in the preceding clauses (i) or
(ii) (other than negotiations with CrossComm and its representatives regarding
the transactions contemplated by this Agreement).
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3.8 Absence of Undisclosed Liabilities. Olicom has no material obligations
or liabilities of any nature (matured or unmatured, fixed or contingent) other
than (i) those set forth or adequately provided for in the balance sheet
included in the Olicom 1996 Financial Statement (the "Olicom Balance Sheet"),
(ii) those not required to be set forth in the Olicom Balance Sheet under GAAP,
(iii) those incurred in the ordinary course of business since the Olicom Balance
Sheet Date and consistent with past practice, and (iv) those incurred in
connection with the execution and delivery of this Agreement.
3.9 Litigation. There is no private or governmental action, suit,
proceeding, claim, arbitration or investigation pending before any agency, court
or tribunal, foreign or domestic, or, to the knowledge of Olicom or any of its
subsidiaries, threatened against Olicom or any of its subsidiaries or any of
their respective properties that is reasonably likely, individually or in the
aggregate, to have a Material Adverse Effect on Olicom and its subsidiaries,
taken as a whole.
3.10 Restrictions on Business Activities. There is no material agreement,
judgment, injunction, order or decree binding upon Olicom or any of its
subsidiaries which has the effect or is reasonably likely to have the effect of
prohibiting or materially impairing the conduct of business by Olicom or any of
its subsidiaries as currently conducted. Section 3.10 of the Olicom Disclosure
Letter contains a true and complete list or brief description of any agreements
or arrangements restricting Olicom's ability to compete in the marketplace, and
any joint venture contract or arrangement or any other agreement which involves
or is expected to involve a sharing of profits with other persons.
3.11 Title to Property. Olicom and its subsidiaries have good and valid
title to all of their respective properties, interests in properties and assets,
real and personal, acquired after the Olicom Balance Sheet Date (except
properties, interests in properties and assets sold or otherwise disposed of
since the Olicom Balance Sheet Date in the ordinary course of business), or in
the case of leased properties and assets, valid leasehold interests therein,
free and clear of all mortgages, liens, pledges, charges or encumbrances of any
kind or character, except (i) the lien of current taxes not yet due and payable,
(ii) such imperfections of title, liens and easements as do not and will not
materially detract from or interfere with the use of the properties subject
thereto or affected thereby, or otherwise materially impair business operations
involving such properties, (iii) liens securing debt which is reflected on the
Olicom Balance Sheet, or (iv) those which would not have a Material Adverse
Effect on Olicom and its subsidiaries, taken as a whole. The plants, property
and equipment of Olicom and its subsidiaries that are used in the operations of
their businesses are in good operating condition and repair, reasonable wear and
tear excepted. All properties used in the operations of Olicom and its
subsidiaries are reflected in the Olicom Balance Sheet to the extent GAAP
requires the same to be reflected.
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3.12 Intellectual Property.
(a) To its knowledge, Olicom and its subsidiaries own, or are
licensed or otherwise possess legally enforceable rights to use, all
Intellectual Property that is used in or necessary to conduct the business of
Olicom and its subsidiaries as currently conducted by Olicom and its
subsidiaries.
(b) To Olicom's knowledge, there is no unauthorized use,
disclosure, infringement or misappropriation of any Intellectual Property rights
of Olicom or any of its subsidiaries, any trade secret material to Olicom or any
of its subsidiaries, or any Third Party Intellectual Property Right to the
extent licensed by or through Olicom or any of its subsidiaries, by any third
party, including any employee or former employee of Olicom or any of its
subsidiaries.
(c) Olicom is not, nor will it be as a result of the execution and
delivery of this Agreement or the performance of its obligations pursuant
hereto, in breach of any license, sublicense or other agreement relating to any
Intellectual Property or Third Party Intellectual Property Rights, the breach of
which would have or would be reasonably likely to have a Material Adverse Effect
on Olicom and its subsidiaries, taken as a whole.
(d) To Olicom's knowledge, all patents, registered trademarks,
registered service marks and copyright registrations held by Olicom are valid
and subsisting. Neither Olicom nor any of its subsidiaries (i) is a party to any
suit, action or proceeding which involves a claim of infringement of any
patents, trademarks, service marks, copyrights or violation of any trade secret
or other proprietary right of any third party, or (ii) has brought any action,
suit or proceeding for infringement of Intellectual Property or breach of any
license or agreement involving Intellectual Property against any third party. To
Olicom's knowledge, the manufacture, marketing, licensing or sale of Olicom's
products do not infringe any patent, trademark, service xxxx, copyright, trade
secret or other proprietary right of any third party.
(e) Olicom has a policy to secure valid written assignments from
all consultants and employees who contribute or have contributed to the creation
or development of Intellectual Property of the rights to such contributions that
Olicom does not already own by operation of law. All use, disclosure or
appropriation of Confidential Information owned by Olicom by or to a third party
has been pursuant to the terms of a written agreement between Olicom (or a
subsidiary of Olicom) and such third party. All use, disclosure or appropriation
of Confidential Information not owned by Olicom has been pursuant to the terms
of a written agreement between Olicom (or a subsidiary of Olicom) and the owner
of such Confidential Information, or is otherwise lawful.
3.13 Environmental Matters. Olicom and each of its subsidiaries (i) have
obtained all applicable Environmental Permits that are required for the
ownership, use,
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or operation of their facilities (and equipment and structures thereon) to
comply with applicable laws relating to health, pollution, protection of the
environment or a community's right to know, including Environmental Laws, and
(ii) are in compliance with all terms and conditions of such Environmental
Permits, and also are in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in such Environmental Laws or contained in any judicial or
administrative judgment or decision arising thereunder, except where such
failure to comply is not reasonably likely to have a Material Adverse Effect on
Olicom and its subsidiaries, taken as a whole.
3.14 Taxes. Olicom and each of its subsidiaries have timely filed all Tax
Returns required to be filed by any of them, have paid all Taxes shown thereon
to be due and have provided adequate accruals in accordance with GAAP in its
financial statements for any Taxes that have not been paid, whether or not shown
as being due on any Tax Returns. Except as disclosed in the Olicom Disclosure
Letter, (i) no material claim for Taxes has become a lien against the property
of Olicom or any of its subsidiaries or is being asserted against Olicom or any
of its subsidiaries, other than liens for Taxes not yet due and payable, (ii) no
audit of any Tax Return of Olicom or any of its subsidiaries is being conducted
by a Tax Authority, (iii) no extension of the statute of limitations on the
assessment of any Taxes has been granted to Olicom or any of its subsidiaries
and is currently in effect, and (iv) there is no agreement, contract or
arrangement to which any United States subsidiary of Olicom is a party that may
result in the payment of any amount that would not be deductible by reason of
Sections 280G or 404 of the Code. Olicom has not been and will not be required
to include any material adjustment in Taxable income for any Tax period (or
portion thereof) pursuant to Sections 481 or 263A of the Code or any comparable
provision under state or foreign Tax laws as a result of transactions, events or
accounting methods employed by Olicom or any of its subsidiaries prior to the
Merger. Neither Olicom nor any of its subsidiaries is a party to any tax sharing
or tax allocation agreement, nor does Olicom or any of its subsidiaries owe any
amount under any such agreement(s). Olicom and each of its subsidiaries are in
full compliance with all terms and conditions of any Tax exemptions or other
Tax-sharing agreement or order of a foreign government, and the consummation of
the Merger shall not have any adverse effect on the continued validity and
effectiveness of any such Tax exemptions or other Tax-sharing agreement or
order.
3.15 Employee Benefit Plans.
(a) As used in this Section 3.15, "Olicom Employee Plans" means,
with respect to Olicom, Inc., a Delaware corporation ("Olicom USA"), (i) all
employee benefit plans subject to ERISA, (ii) any stock option, stock purchase,
phantom stock or stock appreciation right, (iii) all supplemental retirement,
severance, sabbatical, medical, dental, vision care, disability, employee
relocation, cafeteria benefit (Code Section 125) or dependent care (Code Section
129), life insurance or accident insurance, bonus, pension, profit sharing,
savings, deferred compensation or incentive plans, programs or
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arrangements which are not employee benefit plans as otherwise covered under
clause (i) above, (iv) other fringe or employee benefit plans, programs or
arrangements that apply to senior management of Olicom USA and that do not
generally apply to all employees, and (v) any current or former employment,
executive compensation or severance agreements, written or otherwise, as to
which unsatisfied obligations of Olicom of greater than $25,000 remain for the
benefit of, or relating to, any present or former employee, consultant or
director of CrossComm, but excluding any plan or arrangement maintained or
sponsored by any non-domestic entity.
(b) (i) Other than continued health care coverage required under
COBRA or applicable law, none of the Olicom Employee Plans promises or provides
retiree medical or other retiree or post termination welfare benefits to any
person; (ii) there has been no "prohibited transaction" with respect to any
Olicom Employee Plan which is reasonably likely to have a Material Adverse
Effect on Olicom USA; (iii) each Olicom Employee Plan is in material compliance
with the requirements prescribed by all statutes, rules and regulations
(including ERISA and the Code) and has been administered in all material
respects in accordance with its terms and in material compliance with the
requirements prescribed by all statutes, rules and regulations (including ERISA
and the Code), and Olicom USA and each ERISA Affiliate have performed all
obligations required to be performed by them under, are not in any respect in
material default under or violation of, and have no knowledge of any material
default or material violation by any other party to, any of the Olicom Employee
Plans; (iv) neither Olicom USA nor any ERISA Affiliate is subject to any
liability or penalty under Sections 4976 through 4980 of the Code or Title I of
ERISA with respect to any of the Olicom Employee Plans which is reasonably
likely to have a Material Adverse Effect on Olicom USA; (v) all contributions
required to be made by Olicom USA or any ERISA Affiliate to any Olicom Employee
Plan have been made on or before their due dates, and a reasonable amount has
been accrued for contributions to each Olicom Employee Plan for the current plan
years; (vi) with respect to each Olicom Employee Plan, no "reportable event"
within the meaning of Section 4043 of ERISA (excluding any such event for which
the 30 day notice requirement has been waived under the regulations to Section
4043 of ERISA) nor any event described in Sections 4062, 4063 or 4041 or ERISA
has occurred; and (vii) no Olicom Employee Plan is covered by, and neither
Olicom USA nor any ERISA Affiliate has incurred or expects to incur any
liability under Title IV of ERISA or Section 412 of the Code. With respect to
each Olicom Employee Plan subject to ERISA as either an employee pension plan
within the meaning of Section 3(2) of ERISA or an employee welfare benefit plan
within the meaning of Section 3(1) of ERISA, Olicom USA has prepared in good
faith and timely filed all required governmental reports (which were true and
correct as of the date filed), and Olicom USA has properly and timely filed and
distributed or posted all notices and reports to employees required to be filed,
distributed or posted with respect to each such Olicom Employee Plan. No suit,
administrative proceeding, action or other litigation has been brought, or to
the knowledge of Olicom, is threatened, against or with respect to any such
Olicom Employee Plan, including, without limitation, any audit or inquiry by
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the Internal Revenue Service or Department of Labor, and no event (other than
routine claims for benefits) has occurred and no set of circumstances have
occurred in connection with any Olicom Employee Plan for which Olicom or any of
its affiliates or subsidiaries could be subject to any material liability.
Neither Olicom USA nor any ERISA Affiliate is a party to, or has made any
contribution to or otherwise incurred any obligation under, any "multiemployer
plan," as defined in Section 3(37) of ERISA.
(c) With respect to each Olicom Employee Plan, Olicom USA has
complied in all material respects with (i) the applicable health care
continuation and notice provisions of COBRA and the proposed regulations
thereunder, (ii) the applicable requirements of the Family Leave Act of 1993 and
the regulations thereunder, and (iii) Section 609 of ERISA.
3.16 Employee Matters. Olicom and each of its subsidiaries are in
compliance in all respects with all currently applicable laws and regulations
respecting employment, discrimination in employment, terms and conditions of
employment, wages, hours and occupational safety and health and employment
practices, and are not engaged in any unfair labor practice, except where the
failure to be in compliance or the engagement in such unfair labor practices
would not have a Material Adverse Effect on Olicom and its subsidiaries, taken
as a whole. Neither Olicom nor any of its subsidiaries has any obligations under
COBRA with respect to any former employees or qualifying beneficiaries
thereunder, except for obligations that would not have a Material Adverse Effect
on Olicom. Neither Olicom nor any of its subsidiaries is a party to any
collective bargaining agreement or other labor union contract, nor does Olicom
nor any of its subsidiaries know of any activities or proceedings of any labor
union to organize any such employees.
3.17 Certain Agreements. Olicom has not breached or received in writing
any claim or threat that it has breached any of the terms of conditions of any
material agreement, contract or commitment (each, a "Olicom Material Contract")
in such a manner as would permit any other party to cancel or terminate the same
or would permit any other party to collect material damages from Olicom under
any Olicom Material Contract.
3.18 Compliance With Laws. Each of Olicom and its subsidiaries has
complied with, is not in violation of, and has not received any notices of
violation with respect to, any applicable statute, law or regulation with
respect to the conduct of its business, or the ownership or operation of its
business, except for such violations or failures to comply as would not have a
Material Adverse Effect on Olicom and its subsidiaries, taken as a whole.
3.19 Brokers' and Finders' Fees. Except for payment obligations to Alex.
Xxxxx & Sons Incorporated, Olicom has not incurred, nor will it incur, directly
or indirectly,
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any liability for brokerage or finders' fees or agents' commissions or
investment bankers' fees in connection with this Agreement or any transaction
contemplated hereby.
3.20 Registration Statement; Joint Proxy Statement/Prospectus. The
information supplied by Olicom and MergerSub for inclusion in the Registration
Statement shall not, at the time the Registration Statement (including any
amendments or supplements thereto) is declared effective by the Commission,
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The information
supplied by Olicom for inclusion in the Joint Proxy Statement shall not, on the
date the Joint Proxy Statement is first mailed to Olicom's stockholders in
connection with the meeting of Olicom's stockholders to consider the Merger (the
"Olicom Stockholders' Meeting"), at the time of the CrossComm Stockholders'
Meeting or the Olicom Stockholders' Meeting, and at the Effective Time, contain
any statement which, at such time, is false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they are made, not
false or misleading; or omit to state any material fact necessary to correct any
statement in any earlier communication with respect to the solicitation of
proxies for the CrossComm Stockholders' Meeting or the Olicom Stockholders'
Meeting which has become false or misleading. If at any time prior to the
Effective Time any event or information should be discovered by Olicom or
MergerSub which should be set forth in an amendment to the Registration
Statement or a supplement to the Joint Proxy Statement, Olicom or MergerSub will
promptly inform CrossComm. Notwithstanding the foregoing, Olicom and MergerSub
make no representation, warranty or covenant with respect to any information
supplied by CrossComm which is contained in any of the foregoing documents.
3.21 Opinion of Financial Advisor. Olicom has been advised in writing by
its financial advisor, Alex. Xxxxx & Sons Incorporated, that in such advisor's
opinion as of the date hereof, the consideration to be paid by Olicom is fair to
Olicom from a financial point of view.
3.22 Vote Required. The affirmative vote of a majority of the votes cast
at the Olicom Stockholders' Meeting is the only vote of the holders of any of
Olicom's capital stock necessary to approve this Agreement and the transactions
contemplated hereby.
3.23 Board Approval. The Boards of Directors of Olicom and MergerSub have
prior to the date hereof unanimously (i) approved the Merger, (ii) determined
that the Merger is in the best interests of their respective stockholders and is
on terms that are fair to such stockholders, (iii) delegated to the Chairman of
the Board and the Managing Director the authority to approve the Agreement and
(iv) determined to recommend that the stockholders of Olicom approve this
Agreement (upon its execution and delivery on behalf of Olicom pursuant to the
foregoing authorization) and the consummation of the Merger.
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ARTICLE IV
CONDUCT PRIOR TO THE EFFECTIVE TIME
4.1 Conduct of Business of CrossComm and Olicom. During the period from
the date of this Agreement and continuing until the earlier of the termination
of this Agreement or the Effective Time, each of CrossComm and Olicom agrees
(except to the extent expressly contemplated by this Agreement or as consented
to in writing by the other), to carry on its and its subsidiaries' business in
the usual, regular and ordinary course in substantially the same manner as
heretofore conducted, to pay and to cause its subsidiaries to pay debts and
Taxes when due subject to good faith disputes over such debts or taxes, to pay
or perform other obligations when due, and to use all reasonable efforts (under
the circumstances) to preserve intact its and its subsidiaries' present business
organizations, use its reasonable efforts to keep available the services of its
and its subsidiaries' present officers and key employees and use its reasonable
efforts consistent with past practice to preserve its and its subsidiaries'
relationships with customers, suppliers, distributors, licensors, licensees and
others having business dealings with it or its subsidiaries, to the end that its
and its subsidiaries' goodwill and ongoing businesses shall be unimpaired at the
Effective Time. Each of CrossComm and Olicom agrees to promptly notify the other
of any event or occurrence which would have a Material Adverse Effect. Without
limiting the foregoing, except as expressly contemplated by this Agreement,
neither CrossComm nor Olicom shall do, cause or permit any of the following, or
allow, cause or permit any of its subsidiaries to do, cause or permit any of the
following, without the prior written consent of the other:
(a) Cause or permit any amendments to the Certificate of
Incorporation or Bylaws (in the case of CrossComm), the Articles of Association
or Rules of Procedure, except as may be required to increase the share capital
of Olicom (in the case of Olicom), or equivalent charter or organizational
documents of any subsidiary;
(b) Declare or pay any dividends on or make any other distributions
(whether in cash, stock or property) in respect of any of its capital stock, or
split, combine or reclassify any of its capital stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of its capital stock, or repurchase or otherwise acquire, directly or
indirectly, any shares of its capital stock except from former employees,
directors and consultants in accordance with agreements providing for the
repurchase of shares in connection with any termination of service to it or its
subsidiaries;
(c) Take, or agree in writing or otherwise to take, any of the
actions described in Sections 4.1(a) and (b) above, or any action which would
make any of its representations or warranties contained in this Agreement untrue
or incorrect or prevent it from performing or cause it not to perform its
covenants hereunder.
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4.2 Conduct of Business of CrossComm. During the period from the date of
this Agreement and continuing until the earlier of the termination of this
Agreement or the Effective Time, except as expressly contemplated by this
Agreement, CrossComm shall not do, cause or permit any of the following, or
allow, cause or permit any of its subsidiaries to do, cause or permit any of the
following, without the prior written consent of Olicom:
(a) Enter into any customer or vendor contract or commitment (or
violate, amend or otherwise modify or waive any of the terms of any of its
contracts) except for (i) contracts or commitments with respect to customers and
vendors with commitments that do not extend beyond June 30, 1997, that were
entered into (and violations, amendments, modifications and waivers of such
contracts) in the ordinary course of business consistent with past practice in
an amount less than $500,000 in any one case; (ii) contracts or commitments with
respect to customers and vendors with commitments that extend beyond June 30,
1997, that were entered into (and violations, amendments, modifications and
waivers of such contracts) in the ordinary course of business consistent with
past practice in an amount less than $200,000; and (iii) contracts or
commitments with respect to customers and vendors that were entered into (and
violations, amendments, modifications and waivers of such contracts) not in the
ordinary course of business consistent with past practice in an amount less than
$100,000 in any one case (Olicom agrees (1) to use its best efforts to respond
to requests from CrossComm with respect to waivers of the foregoing within
twelve (12) business hours, and (2) not to unreasonably withhold consent).
(b) Issue, deliver or sell or authorize or propose the issuance,
delivery or sale of, or purchase or propose the purchase of, any shares of its
capital stock or securities convertible into, or subscriptions, rights, warrants
or options to acquire, or other agreements or commitments of any character
obligating it to issue any such shares or other convertible securities, other
than the issuance of shares of CrossComm Common Stock pursuant to the exercise
of stock options, warrants or other rights therefor outstanding as of March 14,
1997;
(c) Transfer or license to any person or entity any rights to its
Intellectual Property which are material, individually or in the aggregate, to
its and its subsidiaries' businesses, taken as a whole, other than in the
ordinary course of business consistent with past practice, or enter into any
license to use Third Party Intellectual Property Rights;
(d) Enter into or amend any agreements pursuant to which any other
party is granted distribution rights with respect to any of its products or
technology;
(e) Sell, lease or otherwise dispose of or encumber any of its
properties or assets which are material, individually or in the aggregate, to
its and its subsidiaries' businesses, taken as a whole;
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(f) (i) Incur any indebtedness for borrowed money or guarantee any
such indebtedness or issue or sell any debt securities or guarantee any debt
securities of others, except in the ordinary course of business consistent with
past practice; or (ii) except to the extent of reserves therefor reflected on
the CrossComm Balance Sheet, pay, discharge or satisfy in an amount in excess of
$25,000 in any one case, any claim, liability or obligation (absolute, accrued,
asserted or unasserted, contingent or otherwise) arising other than in the
ordinary course of business, other than the payment, discharge or satisfaction
of current liabilities reflected or reserved against in the CrossComm Financial
Statements;
(g) Enter into any operating lease, except in the ordinary course
of business consistent with past practice;
(h) Make any material capital expenditures, capital additions or
capital improvements in an amount greater than $50,000 in any one instance;
(i) Materially increase or reduce the amount of any material
insurance coverage provided by existing insurance policies;
(j) Except, in each instance, to the extent set forth in the
CrossComm Disclosure Letter, adopt or amend any employee benefit or stock
purchase or option plan; accelerate, amend or change the period of
exercisability or vesting of options or other rights granted under, or take any
similar action regarding any CrossComm Option Plan that is reasonably likely to
have a Material Adverse Effect on CrossComm and its subsidiaries, taken as a
whole, or authorize cash payments in exchange for any options or other rights
granted under any of such plans; employ any new officer level employee or any
director level employee; promote any employee to an officer or director level
position; pay any special bonus or special remuneration to any employee or
director; or increase the salaries or wage rates of officer or director level
employees;
(k) Grant any severance or termination pay to any director, officer
or employee except payments made pursuant to written agreements outstanding on
March 14, 1997;
(l) Commence a lawsuit other than (i) for the routine collection of
bills, (ii) in such cases where it in good faith determines that failure to
commence suit would result in the material impairment of a valuable aspect of
its business, provided that it consults with Olicom prior to the filing of such
a suit, or (iii) for a breach of this Agreement;
(m) Acquire or agree to acquire (or permit any of its subsidiaries
to acquire or agree to acquire) by merging or consolidating with, or by
purchasing a substantial portion of the assets of, or by any other manner, any
business or any corporation, partnership, association or other business
organization or division thereof,
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or otherwise acquire or agree to acquire any assets which are material,
individually or in the aggregate, to its and its subsidiaries' business, taken
as a whole, or acquire or agree to acquire any equity securities of any
corporation, partnership, association or business organization;
(n) Make or change any material election in respect of Taxes, adopt
or change any accounting method in respect of Taxes, enter into any closing
agreement, settle any claim or assessment in respect of Taxes, or consent to any
extension or waiver of the limitation period applicable to any claim or
assessment in respect of Taxes;
(o) Fail to give such notices and other information required to be
given to the employees of CrossComm, any collective bargaining unit representing
any group of employees of CrossComm, and any applicable government authority
under the WARN Act, the National Labor Relations Act, as amended, the Code,
COBRA, and other applicable law in connection with the transactions provided for
in this Agreement;
(p) Revalue any of its assets, including writing down the value of
inventory or writing off notes or accounts receivable other than in the ordinary
course of business; or
(q) Take or agree in writing or otherwise to take, any of the
actions described in Sections 4.2(a) through (p) above, or any action which
would make any of its representations or warranties contained in this Agreement
untrue or incorrect or prevent it from performing or cause it not to perform its
covenants hereunder.
4.3 No Solicitation.
(a) CrossComm and its subsidiaries, together with the officers,
directors, employees or other agents of CrossComm and its subsidiaries, (i)
shall not, directly or indirectly, take any action to solicit, initiate or
encourage any inquiries or proposals that constitute, or which could reasonably
be expected to lead to, an Acquisition Proposal (as defined in Section 4.3(d)),
(ii) shall not, directly or indirectly, subject to the terms of the immediately
following sentence, engage in negotiations or discussions with, or disclose any
nonpublic information relating to CrossComm or any of it subsidiaries to, or
afford access to the properties, books or records of CrossComm or any of its
subsidiaries to, any person with regard to an Acquisition Proposal, and (iii)
shall immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any person, firm or entity conducted heretofore
with respect to any of the foregoing and shall inform any such person, firm or
entity of the obligations undertaken by CrossComm in this Section 4.3; provided,
however, that nothing herein shall prohibit the CrossComm Board from taking and
disclosing to CrossComm's stockholders a position with respect to a tender offer
pursuant to Rules 14d-9 and 14e-2 promulgated under the Exchange Act.
Notwithstanding the immediately preceding sentence, if (1) an unsolicited bona
fide written Acquisition
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Proposal, or an unsolicited bona fide expression of interest that CrossComm
reasonably expects could lead to a Acquisition Proposal, shall be received by
the CrossComm Board, (2) the CrossComm Board believes in good faith that such
Acquisition Proposal would, if consummated, result in a transaction more
favorable to CrossComm's stockholders from a financial point of view than the
transaction contemplated by this Agreement (any such more favorable Acquisition
Proposal being referred to herein as a "Superior Proposal"), (3) the CrossComm
Board determines in good faith that it is necessary for the CrossComm Board to
comply with its fiduciary duties to CrossComm's stockholders under applicable
law by considering the Superior Proposal and taking actions consistent herewith
with respect thereto, and (4) that the party making such Superior Proposal has
the financial means, or the ability to obtain the necessary financing, to
consummate such transaction (it being understood that nothing herein shall
prohibit CrossComm from engaging in discussions with such party for the limited
purpose of determining that such party has the financial means, or ability to
obtain the necessary financing, to consummate such transaction), then CrossComm
and its subsidiaries, together with their respective officers, directors,
employees, investment bankers, financial advisors, attorneys, accountants and
other representatives, may (consistent with the provisions hereof) furnish in
connection therewith information, enter into discussions and negotiations,
recommend such Superior Proposal to CrossComm's stockholders and take such other
actions as are consistent with the fiduciary obligations of the CrossComm Board,
and such actions shall not be considered a breach of this Section 4.3 or any
other provisions of this Agreement, provided that, in each such event, CrossComm
notifies Olicom of such determination by the CrossComm Board and provides Olicom
with a written summary in reasonable detail of the Superior Proposal (including
the identity of the offeror and the terms thereof) received from such third
party, together with a copy of all documents containing or referring to
non-public information of CrossComm that are supplied to such third party and
that were not previously supplied to Olicom; and provided, further, that in
order for the foregoing actions to not be considered a breach of this Section
4.3 or any other provision of this Agreement, (x) CrossComm shall not provide
any material non-public information to any such third party if it has not prior
to the date thereof provided such information to Olicom or Olicom's
representatives, and (y) CrossComm provides such non-public information pursuant
to a binding non-disclosure agreement with terms no less favorable as to
confidential information as the Confidentiality Agreement (as defined in Section
5.4).
(b) Notwithstanding anything to the contrary in this Agreement,
CrossComm shall not permit the CrossComm Board to adopt any Acquisition Proposal
unless CrossComm shall have terminated this Agreement pursuant to Section 7.1(g)
and paid Olicom all amounts payable to Olicom pursuant to Section 7.3(b) and
(d).
(c) CrossComm shall notify Olicom promptly (and, in any event, no
later than 24 hours), orally and in writing, after receipt by CrossComm (or its
advisors) of any Acquisition Proposal or obtaining actual knowledge that any
person is submitting an Acquisition Proposal or any request for non-public
information relating to
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CrossComm or any of its subsidiaries or for access to the properties, books or
records of CrossComm or any of its subsidiaries by any person that has advised
CrossComm that it may be considering making, or that has made, an Acquisition
Proposal and will keep Olicom fully informed of the status and details of any
such Acquisition Proposal, notice, request or any correspondence or
communications related thereto and shall provide Olicom with a written summary
in reasonable detail of such Acquisition Proposal, notice or request or
correspondence or communications related thereto (including the identity of the
offeror and the complete terms and conditions of such Acquisition Proposal).
(d) For purposes of this Agreement, "Acquisition Proposal" means
any written offer or proposal for, or any written indication of interest in, a
merger or other business combination involving CrossComm or the acquisition of
25% or more of the outstanding shares of capital stock of CrossComm, or the sale
or transfer of all or substantially all of the assets (excluding the sale or
disposition of assets in the ordinary course of business) of CrossComm, other
than the transactions contemplated by this Agreement.
(e) Nothing in this Section 4.3 shall (x) permit CrossComm to
terminate this Agreement (except as specifically provided in Section 4.3(b) or
Article VII), (y) permit CrossComm to enter into any agreement with respect to
an Acquisition Proposal during the term of this Agreement (it being agreed that
during the term of this Agreement, no party shall enter into any agreement with
any person that provides for, or in any way facilitates, an Acquisition Proposal
(other than (i) a confidentiality agreement in the form described herein and
information provided in accordance with Section 4.3(a), and (ii) as set forth in
Section 4.3(b)), or (z) affect any other obligation of CrossComm under this
Agreement.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 Joint Proxy Statement/Prospectus; Registration Statement. As promptly
as practicable after the execution and delivery of this Agreement, CrossComm and
Olicom shall prepare and file with the Commission the Joint Proxy Statement, and
Olicom shall file with the Commission a Registration Statement on Form F-4 (or
such other or successor form as shall be appropriate), which complies in form
with applicable Commission requirements. Olicom and CrossComm shall use all
reasonable efforts to cause the Registration Statement to become effective as
soon thereafter as practicable. Each of Olicom and CrossComm will notify the
other promptly of the receipt of any comments from the Commission or its staff
and of any request by the Commission or its staff or any other government
officials for amendments or supplements to the Registration Statement or any
other filing or for additional information and will supply the other with copies
of all correspondence between such company or any of its
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representatives, on the one hand, and the Commission, or its staff or any other
government officials, on the other hand, with respect to the Registration
Statement or other filing. The Registration Statement and the other filings
shall comply in all material respects with all applicable requirements of law.
Whenever any event occurs which is required to be set forth in an amendment or
supplement to the Registration Statement or any other filing, Olicom or
CrossComm, as the case may be, shall promptly inform the other of such
occurrence and cooperate in filing with the Commission or its staff or any other
government officials, and/or mailing to stockholders of Olicom and CrossComm,
such amendment or supplement. The Joint Proxy Statement shall include the
recommendation of the CrossComm Board and the Board of Directors of Olicom in
favor of the Merger; provided, however, that the recommendation of the CrossComm
Board may be withdrawn if the CrossComm Board believes in good faith that a
Superior Proposal has been made or shall determine in good faith that to not
withdraw such recommendation would constitute a breach of the CrossComm Board's
fiduciary duty to stockholders under applicable law.
5.2 Meetings of Stockholders.
(a) Promptly after the date hereof, CrossComm shall take all action
necessary in accordance with Delaware Law and its Certificate of Incorporation
and Bylaws to convene the CrossComm Stockholders' Meeting as promptly as
practicable after the Registration Statement is declared effective by the
Commission. CrossComm shall consult with Olicom regarding the date of the
CrossComm Stockholders' Meeting and use all reasonable efforts not to postpone
or adjourn (other than for the absence of a quorum) the CrossComm Stockholders'
Meeting without the consent of Olicom, which consent shall not be required where
CrossComm determines in good faith that it is necessary to postpone or adjourn
the CrossComm Stockholders' Meeting in order to comply with its fiduciary duties
to stockholders under applicable law. Subject to Section 5.1, CrossComm shall
use its best efforts to solicit from stockholders of CrossComm proxies in favor
of the Merger and shall take all other action necessary or advisable to secure
the vote or consent of stockholders required to effect the Merger.
(b) Promptly after the date hereof, Olicom shall take all action
necessary in accordance with the Companies Act, its Articles of Association and
Rules of Procedure to convene the Olicom Stockholders' Meeting as promptly as
practicable after the Registration Statement is declared effective by the
Commission. Olicom shall consult with CrossComm regarding the date of the Olicom
Stockholders' Meeting and use all reasonable efforts not to postpone or adjourn
(other than for the absence of a quorum) the Olicom Stockholders' Meeting
without the consent of CrossComm. Subject to Section 5.1, Olicom shall use its
best efforts to solicit from stockholders of Olicom proxies in favor of the
Merger and shall take all other action necessary or advisable to secure the vote
or consent of stockholders required to effect the Merger.
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5.3 Access to Information; Advice of Changes.
(a) Until the earlier of the Effective Time or the termination of
this Agreement, CrossComm shall afford Olicom and its accountants, counsel and
other representatives, reasonable access during normal business hours during the
period prior to the Effective Time to (i) all of CrossComm's and its
subsidiaries' properties, books, contracts, commitments and records, and (ii)
all other information concerning the business, properties and personnel of
CrossComm and its subsidiaries as Olicom may reasonably request. CrossComm
agrees to provide to Olicom and its accountants, counsel and other
representatives copies of internal financial statements promptly upon request.
(b) Until such time as the Registration Statement is declared
effective by the Commission or the earlier termination of this Agreement, Olicom
shall afford CrossComm and its accountants, counsel and other representatives,
reasonable access during normal business hours during the period prior to the
Effective Time to such information concerning the business, properties and
personnel of Olicom and its subsidiaries as CrossComm may reasonably request.
Olicom agrees to provide to CrossComm and its accountants, counsel and other
representatives copies of internal financial statements promptly upon request.
(c) Subject to compliance with applicable law, from the date hereof
until the earlier of the Effective Time or the termination of this Agreement,
each of Olicom and CrossComm shall confer on a regular and frequent basis with
one or more representatives of the other party to report operational matters of
materiality and the general status of ongoing operations.
(d) No information or knowledge obtained in any investigation
pursuant to this Section 5.3 shall affect or be deemed to modify any
representation or warranty contained herein or the conditions to the obligations
of the parties to consummate the Merger.
(e) Each party hereto shall promptly advise the other parties
hereto in writing of (i) any event occurring subsequent to the date of this
Agreement which would render any representation or warranty of such advising
party contained in this Agreement, if made on or as of the date of such event or
the date of the Closing, untrue or inaccurate in any material respect and (ii)
any material change in such advising party's business.
5.4 Confidentiality. The parties acknowledge that each of Olicom and
CrossComm have previously executed a non-disclosure agreement dated November 27,
1996 (the "Confidentiality Agreement"), which Confidentiality Agreement shall
continue in full force and effect in accordance with its terms.
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5.5 Public Disclosure. Unless otherwise permitted by this Agreement,
Olicom and CrossComm shall consult with each other before issuing any press
release or otherwise making any public statement or making any other public (or
non-confidential) disclosure (whether or not in response to an inquiry)
regarding the terms of this Agreement and the transactions contemplated hereby,
and neither shall issue any such press release with respect to the Merger or the
transactions contemplated hereby or make any public filing with respect thereto
without the prior approval of the other (which approval shall not be
unreasonably withheld), except as may be required by law, or in exercise of the
fiduciary duties of a board of directors, or by obligations pursuant to any
listing agreement with any national securities exchange or with Nasdaq.
5.6 Consents; Cooperation. Each of Olicom and CrossComm shall promptly
apply for or otherwise seek, and use its best efforts to obtain, all consents
and approvals required to be obtained by it for the consummation of the Merger,
including those required under HSR, and shall use its reasonable efforts to
obtain all necessary consents, waivers and approvals under any of the CrossComm
Material Contracts or Olicom Material Contracts, as the case may be, in
connection with the Merger for the assignment thereof or otherwise, except where
the failure to obtain such consents under CrossComm Material Contracts or Olicom
Material Contracts, as the case may be, would not have a Material Adverse Effect
on CrossComm or Olicom, as the case may be. The parties hereto shall consult and
cooperate with one another, and consider in good faith the views of one another,
in connection with any analyses, appearances, presentations, memoranda, briefs,
arguments, opinions and proposals made or submitted by or on behalf of any party
hereto in connection with proceedings under or relating to HSR or any other
federal or state antitrust or fair trade law.
5.7 Affiliate Agreements. Section 5.7 of the CrossComm Disclosure Letter
sets forth those persons who may be deemed "Affiliates" of CrossComm within the
meaning of Rule 145 promulgated under the Securities Act ("Rule 145"). CrossComm
shall provide Olicom such information and documents as Olicom shall reasonably
request for purposes of reviewing such list, and shall notify CrossComm in
writing with respect to any change in the identity of its Affiliates prior to
the Closing Date. CrossComm shall use its best efforts to deliver or cause to be
delivered to Olicom, concurrently with the execution and delivery of this
Agreement (and in each case at least 30 days prior to the Effective Time) from
each of the Affiliates of CrossComm, an executed Affiliate Agreement in the form
attached hereto as Exhibit C. Olicom and MergerSub shall be entitled to place
appropriate legends on the certificates evidencing any Olicom Common Stock to be
received by such Affiliates of CrossComm pursuant to the terms of this
Agreement, and to issue appropriate stop transfer instructions to the transfer
agent for Olicom Common Stock, consistent with the terms of such Affiliate
Agreements.
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5.8 Voting Agreements.
(a) Concurrently with the execution and delivery of this Agreement,
CrossComm shall use its best efforts to cause Xxxxxxx Xxxxxxxxx to execute and
deliver to Olicom a voting agreement substantially in the form of Exhibit D
attached hereto.
(b) Concurrently with the execution and delivery of this Agreement,
Olicom shall use its best efforts to cause Lars Xxxx Xxxxxxx to execute and
deliver to CrossComm a voting agreement substantially in the form of Exhibit E
attached hereto.
5.9 Legal Requirements. Each of Olicom, MergerSub and CrossComm shall, and
shall cause their respective subsidiaries to, take all reasonable actions
necessary to comply promptly with all legal requirements which may be imposed on
them with respect to the consummation of the transactions contemplated by this
Agreement, will promptly cooperate with and furnish information to any party
hereto necessary in connection with any such requirements imposed upon such
other party in connection with the consummation of the transactions contemplated
by this Agreement, and shall take all reasonable actions necessary to obtain
(and will cooperate with the other parties hereto in obtaining) any consent,
approval, order or authorization of, or any registration, declaration or filing
with, any Governmental Entity or other person, required to be obtained or made
in connection with the taking of any action contemplated by this Agreement.
5.10 Blue Sky Laws. Olicom shall take such steps as may be necessary to
comply with the securities and blue sky laws of all jurisdictions which are
applicable to the issuance of the Olicom Common Stock in connection with the
Merger.
5.11 Employee Benefit Plans.
(a) As used herein, the "Option Exchange Ratio" shall equal (1) the
sum of (x) $5.00, (y) the Warrant Exchange Ratio times the Warrant Unit
Consideration (as defined in the immediately succeeding sentence) and (z) the
Exchange Ratio times the Final Closing Price, divided by (2) the Final Closing
Price. The value of a Warrant (the "Warrant Unit Consideration") shall be
calculated using the Black-Scholes Formula using a volatility equal to the
52-week historical weekly volatility of Olicom Common Stock and a risk-free rate
of interest equal to the yield to maturity for a United States Treasury Note
with a three-year maturity, as reported by Bloomberg on its historical yield
curve page, and shall be determined by and agreed upon by each of the financial
advisors to Olicom and CrossComm prior to the Closing, which agreement shall not
be unreasonably withheld.
(b) At the Effective Time, the CrossComm Stock Option Plans and
each outstanding option to purchase shares of CrossComm Common Stock under the
CrossComm Stock Option Plans, whether vested or unvested, shall be assumed by
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Olicom. Section 5.11 of the CrossComm Disclosure Letter sets forth a true and
complete list as of March 14, 1997, of all holders of outstanding options under
the CrossComm Stock Option Plans, including the number of shares of CrossComm
capital stock subject to each such option, the exercise or vesting schedule, the
exercise price per share and the term of each such option. On the Closing Date,
CrossComm shall deliver to Olicom an updated Section 5.11 of the CrossComm
Disclosure Letter current as of such date. Each such option so assumed by Olicom
under this Agreement shall continue to have, and be subject to, the same terms
and conditions set forth in the CrossComm Stock Option Plans and the documents
governing the outstanding options under those plans, immediately prior to the
Effective Time, except that (i) such option shall be exercisable for that number
of whole shares of Olicom Common Stock equal to the product of the number of
shares of CrossComm Common Stock that were issuable upon exercise of such option
immediately prior to the Effective Time multiplied by the Option Exchange Ratio
and rounded down to the nearest whole number of shares of Olicom Common Stock,
and (ii) the per share exercise price for the shares of Olicom Common Stock
issuable upon exercise of such assumed option shall be equal to the quotient
determined by dividing the exercise price per share of CrossComm Common Stock at
which such option was exercisable immediately prior to the Effective Time by the
Option Exchange Ratio, rounded up to the nearest whole cent. Consistent with the
terms of the CrossComm Option Plans and the documents governing the options
outstanding under such plans and except as set forth in the CrossComm Disclosure
Letter, the Merger shall not terminate any of the outstanding options under such
plans or accelerate the exercisability or vesting of such options or the shares
of Olicom Common Stock which will be subject to such options upon Olicom's
assumption of the options in the Merger. It is the intention of the parties that
any assumption of "incentive stock options" (as defined in Section 422 of the
Code) ("ISOs") shall comply with Section 424 of the Code such that ISOs so
assumed by Olicom shall qualify following the Effective Time as ISOs if and to
the extent that such options qualified as ISOs prior to the Effective Time. As
soon as reasonably practical, but in no event more than 25 days after the
Effective Time, Olicom will issue to each person who, immediately prior to the
Effective Time, was a holder of an outstanding option under the CrossComm Option
Plans a document reasonably evidencing the foregoing assumption of such option
by Olicom.
(c) Outstanding purchase rights under the CrossComm ESPP shall be
exercised or assumed, and the CrossComm ESPP shall be terminated, as follows:
(i) If it is determined on or before June 20, 1997, that the
Effective Time shall occur before July 1, 1997, the CrossComm Board shall
give notice to the holders of all outstanding purchase rights under the
CrossComm ESPP in accordance with clause (c) of the second paragraph of
Section 16 of the CrossComm ESPP, and each such outstanding purchase right
shall be deemed to be exercised as described in such clause. The CrossComm
ESPP, and all outstanding purchase rights thereunder, shall terminate with
such exercise date,
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and no purchase rights shall be subsequently granted or exercised under
the CrossComm ESPP.
(ii) If it is determined on or before June 20, 1997, that the
Effective Time shall occur on or after July 1, 1997, CrossComm shall take
such actions as are necessary to cause the Offering (as defined in the
CrossComm ESPP) scheduled to commence on July 1, 1997, to be postponed
until the earlier of such time as is determined by the Surviving
Corporation or the termination of this Agreement.
(iii) Section 5.11(c) of the CrossComm Disclosure Letter hereto
sets forth a true and complete list as of the date hereof of all holders
of outstanding purchase rights under the CrossComm ESPP, including the
payroll deduction amount elected by each holder and the price per share of
CrossComm Stock at the beginning of the current Offering. On the Closing
Date, CrossComm shall deliver to Olicom an updated Section 5.11(c) of the
CrossComm Disclosure Letter current as of such date.
5.12 Letter of Olicom's and CrossComm's Accountants.
(a) Olicom shall use all reasonable efforts to cause to be
delivered to CrossComm a Procedures Letter pursuant to SAS 76 of Olicom's
independent auditors, dated the date on which the Registration Statement shall
become effective and addressed to Olicom and CrossComm, in form reasonably
satisfactory to CrossComm and customary in scope and substance for letters
delivered by independent public accountants in connection with registration
statements similar to the Registration Statement.
(b) CrossComm shall use all reasonable efforts to cause to be
delivered to Olicom a Procedures Letter pursuant to SAS 76 of CrossComm's
independent auditors, dated the date on which the Registration Statement shall
become effective and addressed to Olicom and CrossComm, in form reasonably
satisfactory to Olicom and customary in scope and substance for letters
delivered by independent public accountants in connection with registration
statements similar to the Registration Statement.
5.13 Directorship. In connection with the meeting of Olicom's stockholders
called for the purpose of approving this Agreement and the transactions
contemplated hereby, Olicom shall nominate Xxxxxxx Xxxxxxxxx as a director for a
term of one year, and use its best efforts to secure his election as a director
of Olicom.
5.14 Form S-8. Olicom agrees to file, no later than 25 days after the
Closing, a registration statement on Form S-8 covering the shares of Olicom
Common Stock issuable pursuant to outstanding options under the CrossComm Option
Plans assumed
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by Olicom. CrossComm shall cooperate with and assist Olicom in the preparation
of such registration statement.
5.15 Indemnification.
(a) For a period of six years after the Effective Time, Olicom
shall, and shall cause the Surviving Corporation to, indemnify and hold harmless
the present and former officers, directors, employees, fiduciaries and agents of
CrossComm (the "Indemnified Parties") in respect of acts or omissions occurring
on or prior to the Effective Time to the fullest extent permitted by applicable
law and to the fullest extent provided under CrossComm's Certificate of
Incorporation and Bylaws or any indemnification agreement with CrossComm
officers and directors to which CrossComm is a party, in each case in effect on
the date hereof; provided, however, that such indemnification shall be subject
to any limitation imposed from time to time under applicable law. Without
limitation of the foregoing, in the event any such Indemnified Party is or
becomes involved in any capacity in any action, proceeding or investigation in
connection with any matter relating to this Agreement or the transactions
contemplated hereby occurring on or prior to the Effective Time, Olicom shall,
or shall cause the Surviving Corporation to, pay as incurred such Indemnified
Party's reasonable legal and other expenses (including the cost of any
investigation and preparation) incurred in connection therewith.
(b) After the Effective Time and until July 14, 1999, Olicom shall
provide officers' and directors' liability insurance in respect of acts or
omissions occurring on or prior to the Effective Time covering each such person
currently covered by CrossComm's officers' and directors' liability insurance
policy on terms substantially similar to those of such policy in effect on the
date hereof; provided, however, that in satisfying its obligation under this
Section , Olicom shall not be obligated to expend in any one year in excess of
$200,000 for such coverage, and if the Surviving Corporation is unable to obtain
the insurance required by this Section 5.15, it shall obtain as much comparable
insurance as possible for an annual premium equal to such maximum amount.
(c) To the extent there is any claim, action, suit, proceeding or
investigation (whether arising before or after the Effective Time) against an
Indemnified Party that arises out of or pertains to any action or omission in
his or her capacity as a director, officer, employee, fiduciary or agent of
CrossComm occurring prior to the Effective Time, or arises out of or pertains to
the transactions contemplated by this Agreement for a period of six years after
the Effective Time (whether arising before or after the Effective Time), such
Indemnified Party shall be entitled to be represented by counsel and following
the Effective Time (i) any counsel retained by the Indemnified Parties shall be
reasonably satisfactory to the Surviving Corporation and Olicom (it being agreed
that Xxxx and Xxxx LLP is reasonably satisfactory), (ii) the Surviving
Corporation and Olicom shall pay the reasonable fees and expenses of such
counsel, promptly after
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statements therefor are received, and (iii) the Surviving Corporation and Olicom
will cooperate in the defense of any such matter; provided, however, that
neither the Surviving Corporation nor Olicom shall be liable for any settlement
effected without its written consent (which consent shall not be unreasonably
withheld); and provided, further, that, in the event that any claim or claims
for indemnification are asserted or made within such six-year period, all rights
to indemnification in respect of any such claim or claims shall continue until
the final disposition of any and all such claims. The Indemnified Parties as a
group may retain only one law firm to represent them with respect to any single
action unless there is, under applicable standards of professional conduct, a
conflict on any significant issue between the positions of any two or more
Indemnified Parties.
(d) The provisions of this Section 5.15 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Party, and his or her
heirs and representatives.
5.16 Listing of Additional Shares, Warrants and Warrant Shares. Prior to
the Effective Time, Olicom shall file with the Nasdaq National Market a
Notification Form for Listing of Additional Shares with respect to the shares
referred to in Section 6.1(f), and with respect to the Warrants, shall file a
Nasdaq National Market Application for Initial Inclusion and shall use its best
efforts to receive an approval letter from Nasdaq with respect thereto.
5.17 Best Efforts and Further Assurances. Each of the parties to this
Agreement shall use its best efforts to effectuate the transactions contemplated
hereby and to fulfill and cause to be fulfilled the conditions to Closing under
this Agreement. Each party hereto, at the reasonable request of another party
hereto, shall execute and deliver such other instruments and do and perform such
other acts and things as may be necessary or desirable for effecting completely
the consummation of this Agreement and the transactions contemplated hereby.
ARTICLE VI
CONDITIONS TO THE MERGER
6.1 Conditions to Obligations of Each Party to Effect the Merger. The
respective obligations of each party to this Agreement to consummate and effect
this Agreement and the transactions contemplated hereby shall be subject to the
satisfaction at or prior to the Effective Time of each of the following
conditions, any of which may be waived, in writing, by agreement of all the
parties hereto:
(a) This Agreement and the Merger shall have been approved and
adopted (i) by the requisite vote of the stockholders of CrossComm (as described
in
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Section 2.23) under Delaware Law, and (ii) by the requisite vote of the
stockholders of Olicom (as described in Section 3.22).
(b) The Commission shall have declared the Registration Statement
effective. No stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued, and no proceeding for that
purpose, and no similar proceeding in respect of the Joint Proxy Statement,
shall have been initiated or threatened by the Commission.
(c) No temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent jurisdiction or other
legal or regulatory restraint or prohibition preventing the consummation of the
Merger shall be in effect, nor shall any proceeding brought by an administrative
agency or commission or other governmental authority or instrumentality,
domestic or foreign, seeking any of the foregoing be pending; nor shall there be
any action taken, or any statute, rule, regulation or order enacted, entered,
enforced or deemed applicable to the Merger, which makes the consummation of the
Merger illegal or prevents or prohibits the Merger. In the event that an
injunction or other order shall have been issued, each party agrees to use its
reasonable diligent efforts to have such injunction or other order lifted.
(d) Olicom shall have received all state securities and "blue sky"
permits and other such authorizations necessary to consummate the transactions
contemplated hereby.
(e) All material authorizations, consents, orders or approvals of,
or declarations or filings with, or expiration of waiting periods imposed by,
any Governmental Entity (collectively, "Authorizations and Approvals") necessary
for the consummation of the transactions contemplated by this Agreement and the
Certificate of Merger shall have been filed, expired or been obtained, other
than those that, individually or in the aggregate, the failure to be filed,
expired or obtained would not (i) as to Authorizations and Approvals required
pursuant hereto of Olicom, in the reasonable opinion of CrossComm after
consultation with Olicom, have a material adverse effect on Olicom, and (ii) as
to Authorizations and Approvals required pursuant hereto of CrossComm, in the
reasonable opinion of Olicom after consultation with CrossComm, have a Material
Adverse Effect on CrossComm.
(f) The filing with the Nasdaq National Market of (i) a
Notification Form for Listing of Additional Shares shall have been made with
respect to the shares of Olicom Common Stock issuable upon conversion of the
CrossComm Common Stock in the Merger, upon the exercise of the Warrants and upon
exercise of the options under the CrossComm Option Plans assumed by Olicom, and
(ii) a National Market Application for Initial Inclusion with respect to the
Warrants. The Warrants shall have been approved for listing on the Nasdaq
National Market upon official notification thereof.
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(g) The Commercial and Companies Agency of the Kingdom of Denmark
shall have registered the issuance of the Olicom Common Stock included in the
Merger Consideration to the extent required by the Companies Act and the
amendment of the Articles of Association that is required to increase the share
capital of Olicom.
6.2 Additional Conditions to Obligations of CrossComm. The obligations of
CrossComm to consummate and effect this Agreement and the transactions
contemplated hereby shall be subject to the satisfaction at or prior to the
Effective Time of each of the following conditions, any of which may be waived,
in writing, by CrossComm:
(a) The representations and warranties of Olicom and MergerSub
contained in this Agreement shall be true and correct as of the date when made
and as of the Effective Time, except to the extent that any such representation
and warranty speaks as of an earlier date, with the same force and effect as if
made on and as of the Effective Time, except for changes expressly contemplated
by this Agreement and such inaccuracies as individually or in the aggregate that
would not have a Material Adverse Effect on Olicom, and CrossComm shall have
received a certificate to such effect signed on behalf of Olicom by the Managing
Director and Chief Financial Officer of Olicom.
(b) Olicom and MergerSub shall have performed or complied in all
material respects with all covenants, obligations, conditions and agreements
required by this Agreement to be performed or complied with by them on or prior
to the Effective Time, and, CrossComm shall have received a certificate to such
effect signed by the Managing Director and Chief Financial Officer of Olicom.
(c) There shall not have occurred any material adverse change in
the condition (financial or otherwise), properties, assets (including intangible
assets), liabilities, business, operations or results of operations of Olicom
and its subsidiaries, taken as a whole, as a consequence of (i) the occurrence
of acts of God, fire, war, strikes and other similar events beyond the
reasonable control of Olicom the result of which (or the reasonably likely
result of which) is (or will be) the substantial impairment of the value of the
business of Olicom and its subsidiaries, taken as a whole, or (ii) a material
change in the political or economic environment in the Kingdom of Denmark the
result of which (or the reasonably likely result of which) is (or will be) the
substantial impairment of the value of the businesses of Olicom and its
subsidiaries, taken as a whole.
(d) CrossComm shall have been furnished with evidence satisfactory
to it of the consent or approval of those persons whose consent or approval
shall be required in connection with the Merger under any material contract of
Olicom or any of its subsidiaries or otherwise, except where the failure to
obtain such consent or approval would not have a Material Adverse Effect on
Olicom.
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(e) No temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent jurisdiction or other
legal or regulatory restraint provision limiting or restricting Olicom's
business following the Merger shall be in effect, nor shall any proceeding
brought by an administrative agency or commission or other Governmental Entity,
domestic or foreign, seeking the foregoing be pending except where the existence
of any of the foregoing items would not have a Material Adverse Effect on
Olicom.
6.3 Additional Conditions to the Obligations of Olicom and MergerSub. The
obligations of Olicom and MergerSub to consummate and effect this Agreement and
the transactions contemplated hereby shall be subject to the satisfaction at or
prior to the Effective Time of each of the following conditions, any of which
may be waived, in writing, by Olicom:
(a) The representations and warranties of CrossComm contained in
this Agreement shall be true and correct as of the date when made and as of the
Effective Time, except to the extent that any such representation and warranty
speaks as of an earlier date, with the same force and effect as if made on and
as of the Effective Time, except for such inaccuracies as individually or in the
aggregate that would not have a Material Adverse Effect on CrossComm, and Olicom
and MergerSub shall have received a certificate to such effect signed on behalf
of CrossComm by the President and Chief Financial Officer of CrossComm.
(b) CrossComm shall have performed or complied in all material
respects with all agreements, covenants, obligations and conditions required by
this Agreement to be performed or complied with by it on or prior to the
Effective Time, and Olicom and MergerSub shall have received a certificate to
such effect signed by the President and Chief Financial Officer of CrossComm.
(c) Olicom shall have been furnished with evidence satisfactory to
it of the consent or approval of those persons whose consent or approval shall
be required in connection with the Merger under any material contract of
CrossComm or any of its subsidiaries or otherwise, except where the failure to
obtain such consent or approval would not have a Material Adverse Effect on
CrossComm.
(d) No temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent jurisdiction or other
legal or regulatory restraint provision limiting or restricting Olicom's conduct
or operation of the business of CrossComm and its subsidiaries, following the
Merger shall be in effect, nor shall any proceeding brought by an administrative
agency or commission or other Governmental Entity, domestic or foreign, seeking
the foregoing be pending, except where the existence of any of the foregoing
items would not have a Material Adverse Effect on CrossComm.
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(e) There shall not have occurred any material adverse change in
the condition (financial or otherwise), properties, assets (including intangible
assets), liabilities, business, operations or results of operations of CrossComm
and its subsidiaries, taken as a whole, as a consequence of (i) the occurrence
of acts of God, fire, war, strikes and other similar events beyond the
reasonable control of CrossComm the result of which (or the reasonably likely
result of which) is (or will be) the substantial impairment of the value of the
businesses of CrossComm and its subsidiaries, taken as a whole, to Olicom, or
(ii) a material change in the political or economic environment in Poland which
(or the reasonably likely result of which) is (or will be) the substantial
impairment of the value of the business of CrossComm and its subsidiaries, taken
as a whole, to Olicom.
(f) Olicom shall have received from each of the Affiliates of
CrossComm an executed Affiliate Agreement in substantially the form attached
hereto as Exhibit C.
(g) CrossComm shall deliver resignations of all officers and
directors of its subsidiaries.
(h) As of the taking of the vote at the CrossComm Stockholders'
Meeting with respect to the Merger, holders of no more than 15% of the issued
and outstanding shares of CrossComm Common Stock shall have duly demanded and
perfected, and not withdrawn or forfeited, demands for appraisal rights under
Delaware Law.
(i) In the event that the Final Closing Price is less than $12.50,
CrossComm shall have received an updated written opinion of Xxxxxxxxxx
Securities (or another nationally recognized investment banking firm selected by
the CrossComm Board) that, in such advisor's opinion, as of a date at least one
day prior to the CrossComm Stockholders' Meeting, the consideration to be
received by the stockholders of CrossComm is fair, from a financial point of
view, to the stockholders of CrossComm.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated at any time prior to the
Effective Time (with respect to Sections 7.1(b)-(i), by written notice by the
terminating party to the other party), whether before or after approval of the
matters presented in connection with the Merger by the stockholders of CrossComm
or Olicom:
(a) By the mutual written consent of Olicom and CrossComm;
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(b) By either Olicom or CrossComm if the Merger shall not have been
consummated by August 1, 1997 (provided that the right to terminate this
Agreement under this Section 7.1(b) shall not be available to any party whose
action or failure to act has been the cause of or resulted in the failure of the
Merger to occur on or before such date);
(c) By either Olicom or CrossComm if a court of competent
jurisdiction or other Governmental Entity shall have issued a nonappealable
final order, decree or ruling or taken any other action, in each case having the
effect of permanently restraining, enjoining or otherwise prohibiting the
Merger, except, if the party relying on such order, decree or ruling or other
action has not complied with its obligations under Section 5.9;
(d) By Olicom, if (i) for any reason, the CrossComm Board fails to
call and hold the CrossComm Stockholders' Meeting by June 30, 1997, or (ii) at
the CrossComm Stockholders' Meeting (including any adjournment or postponement),
the requisite vote of the stockholders of CrossComm in favor of this Agreement
and the Merger shall not have been obtained;
(e) By CrossComm, if (i) for any reason the Board of Directors of
Olicom fails to call and hold the Olicom Stockholders' Meeting by June 30, 1997,
or (ii) at the Olicom Stockholders' Meeting (including any adjournment or
postponement), the requisite vote of the stockholders of Olicom in favor of this
Agreement and the Merger shall not have been obtained;
(f) By Olicom, if (i) the CrossComm Board shall have withdrawn or
modified its recommendation of this Agreement or the Merger in a manner adverse
to Olicom or shall have publicly announced or disclosed to any third party its
intention to do any of the foregoing, (ii) an Alternative Transaction (as
defined in Section 7.3(f)) shall have taken place or the CrossComm Board shall
have recommended to the stockholders of CrossComm an Alternative Transaction, or
(iii) a tender offer or exchange offer for 25% or more of the outstanding shares
of CrossComm Common Stock is commenced (other than by Olicom or an affiliate of
Olicom) and the CrossComm Board recommends that the stockholders of CrossComm
tender their shares in such tender or exchange offer;
(g) By CrossComm prior to the Effective Time, if (i) the CrossComm
Board receives a Superior Proposal, (ii) the CrossComm Board determines in good
faith that the failure to accept such Superior Proposal would be inconsistent
with its fiduciary duties to CrossComm's stockholders under applicable law,
(iii) CrossComm has provided Olicom with at least one business day's written
notice of such Superior Proposal, including a written summary thereof in
reasonable detail (including the identity of the offeror and the terms of the
Superior Proposal) and of the determination of the CrossComm Board, and (iv)
contemporaneously with giving the notice specified in Section 7.1(g)(iii),
CrossComm makes the payment specified in Section 7.3(d);
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(h) By Olicom or CrossComm, if there has been a material breach of
any representation, warranty, covenant or agreement on the part of the other
party set forth in this Agreement, which breach (i) causes the conditions set
forth in Sections 6.1 or 6.2(a) (in the case of termination by CrossComm), or in
Sections 6.1 or 6.3(a) (in the case of termination by Olicom) not to be
satisfied, and (ii) shall not have been cured within five business days
following receipt by the breaching party of written notice of such breach from
the other party; or
(i) By CrossComm, (i) if the Final Closing Price is less than
$12.50 and Olicom fails to increase the Exchange Ratio as provided in Section
1.6(b)(x), or (ii) if the Final Closing Price is more than $20.83 and Olicom
decreases the Exchange Ratio as provided in Section 1.6(b)(y).
7.2 Effect of Termination. In the event of termination of this Agreement
as provided in Section 7.1, this Agreement shall forthwith terminate, except as
provided in this Section 7.2 and in Section 9.1, and there shall be no liability
or obligation on the part of Olicom, MergerSub or CrossComm or their respective
officers, directors, stockholders or affiliates, except to the extent that such
termination results from the willful breach by a party hereto of any of its
representations, warranties or covenants set forth in this Agreement; provided,
however, that, the provisions of Section 5.4 (Confidentiality), Section 7.3
(Expenses and Termination Fees), this Section 7.2 and Section 9.1 (Non-Survival
at Effective Time) shall remain in full force and effect and survive any
termination of this Agreement.
7.3 Expenses and Termination Fees.
(a) Except as set forth in this Section 7.3, all fees and expenses
incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expenses, whether or not the
Merger is consummated; provided, however, that Olicom and CrossComm shall share
equally all fees and expenses, other than investment banking, attorneys' and
accountants' fees and expenses, incurred in connection with the printing and
filing of the Joint Proxy Statement (including any related preliminary
materials) and the Registration Statement (including financial statements and
exhibits) and any amendments or supplements.
(b) CrossComm shall reimburse Olicom for all of its reasonable,
documented expenses actually incurred relating to the transactions contemplated
by this Agreement prior to termination (including reasonable, documented fees
and expenses of Olicom's counsel, accountants and financial advisors, but
excluding any discretionary fees paid to such financial advisors) upon the
earliest to occur of the following events:
(i) The termination of this Agreement by Olicom pursuant to Section
7.1(d) as a result of the failure to receive the requisite vote for
approval of this Agreement and the Merger by the stockholders of CrossComm
at the
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CrossComm Stockholders' Meeting if, at the time of such failure, there
shall have been announced an Alternative Transaction which shall not have
been absolutely and unconditionally withdrawn and abandoned; or
(ii) The termination of this Agreement by Olicom pursuant to
Section 7.1(f);
(iii) The termination of this Agreement by CrossComm pursuant to
Section 7.1(g); or
(iv) The termination of this Agreement by Olicom pursuant to
Section 7.1(h) after a material breach of this Agreement by CrossComm.
(c) Olicom shall reimburse CrossComm for all of its reasonable,
documented expenses actually incurred relating to the transactions contemplated
by this Agreement prior to termination (including reasonable, documented fees
and expenses of CrossComm's counsel, accountants and financial advisors, but
excluding any discretionary fees paid to such financial advisors) upon the
earliest to occur of the following events:
(i) The termination of this Agreement by CrossComm pursuant to
Section 7.1(e); or
(ii) The termination of this Agreement by CrossComm pursuant to
Section 7.1(h) after a material breach of this Agreement by Olicom.
(d) CrossComm shall pay Olicom as liquidated damages and not as a
penalty or forfeiture, a termination fee of $2,360,000 upon the earliest to
occur of the following events:
(i) The termination of this Agreement by Olicom pursuant to Section
7.1(d) as a result of the failure to receive the requisite vote for
approval of this Agreement and the Merger by the stockholders of CrossComm
at the CrossComm Stockholders' Meeting if, at the time of such failure,
there shall have been announced an Alternative Transaction which shall not
have been absolutely and unconditionally withdrawn and abandoned and with
respect to which the CrossComm Board shall not have recommended that the
stockholders of CrossComm not vote to accept.
(ii) The termination of this Agreement by Olicom pursuant to
Section 7.1(f); or
(iii) The termination of this Agreement by CrossComm pursuant to
Section 7.1(g).
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(e) The reasonable, documented expenses and fees, if applicable,
payable pursuant to Sections 7.3(b), 7.3(c), 7.3(d)(i) or 7.3(d)(ii) shall be
paid by wire transfer within three business days after the first to occur of the
events described therein; provided that, in no event shall Olicom or CrossComm,
as the case may be, be required to pay any expenses or termination fees, if
applicable, to the other, if, immediately prior to the termination of this
Agreement, the party to receive the expenses, termination fees and other
payment, if applicable, was in breach of any of its material obligations under
this Agreement in any manner that shall have proximately contributed to such
action or failure to act on the part of the other party which gives rise to the
right of termination. In the event that Olicom is required to file suit to seek
all or any portion of the termination fee described in Section 7.3(d), and it is
the prevailing party therein, Olicom shall be entitled to all expenses,
including reasonable, documented attorneys' fees and expenses, which it incurs
in enforcing its rights hereunder.
(f) As used in this Agreement, "Alternative Transaction" means
either (i) a transaction pursuant to which any person (or group of persons),
other than Olicom or its affiliates (a "Third Party"), acquires more than 25% of
the outstanding shares of CrossComm Common Stock, pursuant to a tender offer or
exchange offer or otherwise, (ii) a merger or other business combination
involving CrossComm pursuant to which any Third Party acquires more than 25% of
the outstanding equity securities of CrossComm or the entity surviving such
merger or business combination, (iii) any other transaction pursuant to which
any Third Party acquires control of assets (including for this purpose the
outstanding equity securities of subsidiaries of CrossComm, and the entity
surviving any merger or business combination including any of them) of CrossComm
having a fair market value equal to more than 20% of the fair market value of
all the assets of CrossComm immediately prior to such transaction, or (iv) any
public announcement of a proposal, plan or intention to do any of the foregoing
or any agreement to engage in any of the foregoing.
7.4 Amendment. The boards of directors of the parties hereto may cause
this Agreement to be amended at any time by the execution and delivery of an
instrument in writing signed on behalf of each of the parties hereto; provided,
however, that an amendment made subsequent to adoption of the Agreement by the
stockholders of CrossComm or MergerSub shall not (i) alter or change the amount
or kind of consideration to be received on conversion of the CrossComm Common
Stock, except as provided herein, (ii) alter or change any term of the
Certificate of Incorporation of the Surviving Corporation to be effected by the
Merger, or (iii) alter or change any of the terms and conditions of the
Agreement if such alteration or change would adversely affect the holders of
CrossComm Common Stock or MergerSub Common Stock.
7.5 Extension; Waiver. At any time prior to the Effective Time any party
hereto may, to the extent legally allowed, (i) extend the time for the
performance of any of the obligations or other acts of the other parties hereto,
(ii) waive any inaccuracies in the representations and warranties made to such
party contained herein or in any
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document delivered pursuant hereto, and (iii) waive compliance with any of the
agreements or conditions for the benefit of such party contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party.
ARTICLE VIII
DEFINITIONS
8.1 Defined Terms. As used in this Agreement, the following terms shall
have the meanings set forth below:
"DKK" and "kroner" refer to currency of the Kingdom of Denmark.
Any reference to a party's "knowledge" means such party's actual knowledge
after reasonable inquiry of executive officers and directors of such party.
Any reference to any event, change, condition or effect being "material"
with respect to any entity or group of entities means any material event,
change, condition or effect related to the condition (financial or otherwise),
properties, assets (including intangible assets), liabilities, business,
operations or results of operations of such entity or group of entities.
Any reference to a "Material Adverse Effect" with respect to any entity
means any event, change or effect that is materially adverse to the condition
(financial or otherwise), properties, assets, liabilities, business, operations
or results of operations of such entity.
"Olicom Share Incentive Plans" means Olicom's Share Incentive Plan,
Olicom's 1994 Share Incentive Plan and Olicom's 1996 Share Incentive Plan.
"CrossComm Option Plans" means, collectively, CrossComm's Amended 1988
Incentive Stock Option Plan, CrossComm's Amended 1989 Incentive Stock Option
Plan, CrossComm's 1991 Incentive Stock Option Plan, as amended, CrossComm's 1992
Stock Option Plan, as amended, CrossComm's 1992 Directors Option Plan, as
amended, and CrossComm's 1994 Stock Option Plan, as amended, and CrossComm's
1996 Stock Option Plan, as amended.
"Subsidiary" (and the correlative term "subsidiaries") shall have the
meaning ascribed to it in Rule 1-02 of Regulation S-X, as promulgated by the
Commission.
"USD," "dollars" and "$" refer to currency of the United States of
America.
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ARTICLE IX
GENERAL PROVISIONS
9.1 Non-Survival at Effective Time. The representations, warranties and
agreements set forth in this Agreement shall terminate at the Effective Time,
except that the agreements set forth in Article I, Section 5.4
(Confidentiality), 5.7 (Affiliate Agreements), 5.11 (Employee Benefit Plans),
5.13 (Directorship), 5.14 (Form S-8), 5.15 (Indemnification), 5.17 (Best Efforts
and Further Assurances), 7.3 (Expenses and Termination Fees), 7.4 (Amendment),
and this Article IX shall survive the Effective Time.
9.2 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or by nationally
recognized overnight delivery service, or sent via facsimile (with confirmation
of receipt) to the parties at the following address (or at such other address
for a party as shall be specified by like notice):
If to Olicom or MergerSub, to:
Olicom A/S
Nybrovej 114
XX-0000 Xxxxxx
Attn: Managing Director
Facsimile No.: x00 00 00 0000
Telephone No.: x00 00 00 0000
with a copy to:
Liddell, Sapp, Zivley, Hill & XxXxxx, L.L.P.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxxx X. Xxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
If to CrossComm, to:
CrossComm Corporation
000 Xxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: President
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
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with a copy to:
Xxxx and Xxxx LLP
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
Xxxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
Notices by personal delivery or via nationally recognized overnight delivery
service shall be effective on receipt. Telecopied notices shall be effective on
the date of receipt if received by 5:00 p.m. local time where received, and on
the next business day if received thereafter.
9.3 Interpretation. When a reference is made in this Agreement to Exhibits
or Disclosure Letters, such reference shall be to an Exhibit or Disclosure
Letter to this Agreement unless otherwise indicated. The words "include,"
"includes" and "including" when used herein shall be deemed in each case to be
followed by the words "without limitation." The phrase "made available" in this
Agreement shall mean that the information referred to has been made available if
requested by the party to whom such information is to be made available. The
table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
9.4 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
9.5 Entire Agreement; Nonassignability; Parties in Interest. This
Agreement and the documents and instruments and other agreements specifically
referred to herein or delivered pursuant hereto, including the Exhibits, the
Schedules, including the CrossComm Disclosure Letter and the Olicom Disclosure
Letter (a) constitute the entire agreement among the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof (except for the Confidentiality Agreement, which shall continue in full
force and effect, and shall survive any termination of this Agreement or the
Closing, in accordance with its terms); (b) are not intended to confer upon any
other person any rights or remedies hereunder, except as set forth in Sections
1.6(a)-(c), (e), (f) and (h), 1.7-1.9, and 5.11-5.16; and (c) shall not be
assigned by operation of law or otherwise except as otherwise specifically
provided.
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61
9.6 Severability. In the event that any provision of this Agreement, or
the application thereof, becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement shall continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the greatest extent possible, the
economic, business and other purposes of such void or unenforceable provision.
9.7 Remedies Cumulative. Except as otherwise provided herein, any and all
remedies herein expressly conferred upon a party shall be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon
such party, and the exercise by a party of any one remedy shall not preclude the
exercise of any other remedy.
9.8 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware (without regard to principles
of conflicts of law); provided, however, that matters affecting the validity of
corporate action taken by Olicom shall be governed by the laws of the Kingdom of
Denmark. Each of the parties hereto irrevocably consents to the exclusive
jurisdiction of any court located within the State of Delaware in connection
with any matter based upon or arising out of this Agreement or the matters
contemplated herein, agrees that process may be served upon them in any manner
authorized by the laws of the State of Delaware for such persons and waives and
covenants not to assert or plead any objection which they might otherwise have
to such jurisdiction and such process.
9.9 Rules of Construction. The parties hereto agree that they have been
represented by counsel during the negotiation, preparation and execution of this
Agreement and, therefore, waive the application of any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party drafting such agreement or
document.
[the remainder of this page is intentionally left blank]
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62
IN WITNESS WHEREOF, CrossComm, Olicom and MergerSub have caused this
Agreement to be executed and delivered by their respective officers thereunto
duly authorized, all as of the date first written above.
CROSSCOMM CORPORATION
By: /s/ X. Xxxxxxxxx
---------------------------------------
Its: Chairman
---------------------------------------
OLICOM A/S
By: /s/ Lars Xxxx Xxxxxxx
---------------------------------------
Its: Managing Director
---------------------------------------
By: /s/ Xxx Xxxx
---------------------------------------
Its: Chairman of the Board
---------------------------------------
PW ACQUISITION CORPORATION
By: /s/ Lars Xxxx Xxxxxxx
---------------------------------------
Its: Managing Director
---------------------------------------
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EXHIBIT A
CERTIFICATE OF MERGER
MERGING
PW ACQUISITION CORPORATION
WITH AND INTO
CROSSCOMM CORPORATION
-----------------------------------
Pursuant to Section 251 of the General Corporation Law of the State of Delaware
-----------------------------------
PW Acquisition Corporation, a Delaware corporation ("MergerSub") and
CrossComm Corporation, a Delaware corporation ("CrossComm"), DO HEREBY CERTIFY
AS FOLLOWS:
FIRST: That MergerSub was incorporated on February __, 1997, pursuant to
the Delaware General Corporation Law, as amended (the "Delaware Law"), and that
CrossComm was incorporated on April __, 1987, pursuant to the Delaware Law.
SECOND: That an Agreement and Plan of Reorganization (the "Reorganization
Agreement"), dated as of March 20, 1997, among Olicom, a corporation organized
under the laws of the Kingdom of Denmark, MergerSub and CrossComm, setting forth
the terms and conditions of the merger of MergerSub with and into CrossComm (the
"Merger"), has been approved, adopted, certified, executed and acknowledged by
each of the constituent corporations in accordance with subsection (c) of
Section 251 of the Delaware Law.
THIRD: That the name of the surviving corporation of the merger (the
"Surviving Corporation") shall be CrossComm Corporation.
FOURTH: That the Certificate of Incorporation of MergerSub, pursuant to
Article I of the Reorganization Agreement, shall be the Certificate of
Incorporation of the Surviving Corporation and be amended to read in its
entirety as follows:
ARTICLE I
The name of the corporation is CrossComm Corporation.
FIFTH: That an executed copy of the Reorganization Agreement is on file at
the principal place of business of the Surviving Corporation at the following
address:
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64
CrossComm Corporation
000 Xxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
SIXTH: That a copy of the Reorganization Agreement will be furnished by
the Surviving Corporation, on request and without cost, to any stockholder of
any constituent corporation.
SEVENTH: That the Merger shall become effective upon the filing of this
Certificate of Merger with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, each of MergerSub and CrossComm has caused this
Certificate of Merger to be executed in its corporate name this ___ day of ___,
1997.
PW ACQUISITION CORPORATION
By: ________________________________
_________________ , President
ATTEST:
___________________________
Secretary
CROSSCOMM CORPORATION
By: ________________________________
_________________ , President
ATTEST:
___________________________
________________ , Secretary
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65
EXHIBIT B
_____________________
No. of Warrant Shares
FORM OF WARRANT CERTIFICATE
NO. W-__
VOID AFTER ___________, 2000
WARRANT CERTIFICATE
FOR PURCHASE OF COMMON SHARES
OLICOM A/S
This certifies that FOR VALUE RECEIVED, _______________ is the registered
holder (the "Registered Holder") of the number of Warrants (the "Warrants")
specified above. This Warrant entitles the Registered Holder, but only subject
to the terms and conditions set forth herein and in the Warrant Agreement (as
hereinafter defined), to purchase the number of fully paid and nonassessable
shares (each a "Warrant Share") of Common Stock, par value DKK 0.25 per share
(the "Common Stock"), of Olicom A/S, a corporation organized under the laws of
the Kingdom of Denmark (the "Company"), indicated above at any time after
issuance through the Expiration Date (as hereinafter defined), upon presentation
and surrender of this Warrant Certificate and the form on the reverse hereof
duly executed at the principal office of American Stock Transfer & Trust
Company, as warrant agent, or its successor (the "Warrant Agent"), accompanied
by payment of $19.74 per share of Common Stock (the "Exercise Price") to be
purchased hereunder in lawful money of the United States of America by money
order or certified or official bank check made payable to the Company.
This Warrant Certificate and each Warrant represented hereby are issued
pursuant to, and are subject in all respects to the terms and conditions set
forth in, the Warrant Agreement, dated ______________, 1997 (the "Warrant
Agreement"), by and between the Company and the Warrant Agent.
Prior to the Expiration Date, upon the occurrence of certain events
provided for in the Warrant Agreement, the Exercise Price or the number of
shares of Common Stock subject to purchase upon the exercise of each Warrant
represented hereby are subject to modification or adjustment.
Each Warrant represented hereby is exercisable at the option of the
Registered Holder, but no fractional shares of Common Stock shall be issued. In
the case of the
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66
exercise of less than all of the Warrants represented hereby, the Company shall
cancel this Warrant Certificate upon the surrender hereof and shall execute and
deliver a new Warrant Certificate or Warrant Certificates, which the Warrant
Agent shall countersign, for the balance of such Warrants.
The "Expiration Date" shall mean ______________, 2000, or such earlier
date as all of the Warrants shall be exercised or redeemed. No Warrant may be
exercised after the 5:00 p.m., Central time, on the Expiration Date, and all
rights of the registered holders of the Warrants shall cease after 5:00 p.m.,
Central time, on the Expiration Date.
This Warrant Certificate is exchangeable upon surrender hereof by the
Registered Holder at the principal office of the Warrant Agent in New York, New
York, or the principal office of the Company in greater Copenhagen, Denmark, for
another Warrant Certificate or Warrant Certificates of like tenor and
representing in the aggregate the number of Warrants evidenced by the Warrant
Certificate or Warrant Certificates so surrendered.
Prior to due presentment for registration or transfer of this Warrant
Certificate, the Company and the Warrant Agent shall deem and treat the
Registered Holder hereof as the absolute owner of Warrants (notwithstanding any
notation of ownership or other writing on the Warrant Certificate made by anyone
other than the Company or the Warrant Agent), for the purpose of any exercise
thereof and for all other purposes, and no transfer or exchange will be
effective unless made in accordance with Sections [10 and 11] of the Warrant
Agreement, and neither the Company nor the Warrant Agent shall be affected by
any notice to the contrary.
This Warrant Certificate shall be governed by and construed in accordance
with the laws of the State of Delaware.
This Warrant Certificate is not valid unless countersigned by the Warrant
Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
signed by its duly authorized officers and has caused its corporate seal to be
affixed hereunto.
Dated: __________________, 1997
OLICOM A/S
By:_______________________________________
Its: _____________________________________
By:________________________________________
Its:_______________________________________
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COUNTERSIGNED:
AMERICAN STOCK TRANSFER &
TRUST COMPANY, as warrant agent
By:_________________________________
Name: _____________________________
Authorized Office
FORM TO BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO
EXERCISE WARRANTS
The undersigned Registered Holder hereby irrevocably elects to exercise
Warrants represented by this Warrant Certificate, and to purchase the securities
issuable upon the exercise of such Warrants, and requests that certificates for
such securities shall be issued in the name of
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
________________________
and be delivered to
_______________________________________
_______________________________________
_______________________________________
_______________________________________
(PLEASE PRINT OR TYPE NAME AND ADDRESS)
and if such number of exercised Warrants shall not be all the Warrants evidenced
by this Warrant Certificate, that a new Warrant Certificate for the balance of
such Warrants be registered in the name of, and delivered to the Registered
Holder at the address stated below.
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68
The undersigned represents that the exercise of the Warrants evidenced
hereby was solicited by a member of the National Association of Securities
Dealers, Inc., if not solicited by an NASD member, please write "unsolicited" in
the space below.
______________________________________________
(Name of NASD Member)
Dated: ___________________ X ________________________________________
(Signature of Registered Holder)
_______________________________________________
_______________________________________________
_______________________________________________
(Please print or type name and address of
registered holder)
Signature Guarantee Stamp Required Here if
Securities are to be Delivered to a Person Other
Than Registered Holder
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ASSIGNMENT
TO BE EXECUTED BY THE REGISTERED HOLDER
IN ORDER TO ASSIGN WARRANTS
FOR VALUE RECEIVED, ________________________ hereby sells, assigns and transfers
unto ________________________________________________________
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF TRANSFEREE
____________________________
(Please print or type name and address)
_______________________ of the Warrants represented by this Warrant
Certificate, and hereby irrevocably constitutes and appoints
___________________________, Attorney, to transfer the Warrant Certificate on
the books of the Company, with full power of substitution in the premises.
Dated: X_____________________________________
(Signature of Registered Holder)
Signature Guarantee Stamp Required Here
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND ALL REQUIRED
SIGNATURE GUARANTEES MUST BE PROVIDED BY A MEMBER OF THE MEDALLION STAMP
PROGRAM.
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EXHIBIT C
CROSSCOMM AFFILIATE'S AGREEMENT
C-1
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EXHIBIT D
VOTING AGREEMENT -- CROSSCOMM AFFILIATES
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EXHIBIT E
VOTING AGREEMENT -- OLICOM AFFILIATES
X-0
00
X-0
