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EXECUTION COPY
STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT (this "Agreement"), dated as of March 13, 2000,
by and among SIEMENS CORPORATION, a Delaware corporation ("Siemens"), XXXXXX
ACQUISITION CORP., a Delaware corporation ("Acquisition") and a wholly owned
subsidiary of Siemens, and the Persons listed on the signature pages hereto
(each in such Person's individual capacity, a "Stockholder", and collectively,
the "Stockholders").
RECITALS
A. Each of the Stockholders is, as of the date hereof, the record and
beneficial owner of the number of shares of capital stock, of Entex Information
Services, Inc., a Delaware corporation (the "Company"), set forth on Annex I
hereto.
B. Siemens, Acquisition and the Company concurrently herewith are
entering into an Agreement and Plan of Merger, dated as of the date hereof (the
"Merger Agreement"; capitalized terms used but not defined in this Agreement
have the same meanings ascribed to those terms in the Merger Agreement), which
provides, among other things, for the merger (the "Merger") of Acquisition with
and into the Company upon the terms and subject to the conditions set forth in
the Merger Agreement.
C. As a condition to the willingness of Siemens and Acquisition to
enter into the Merger Agreement, and in order to induce Siemens and Acquisition
to enter into the Merger Agreement, the Stockholders have agreed to enter into
this Agreement.
NOW, THEREFORE, in consideration of the execution and delivery by
Siemens and Acquisition of the Merger Agreement and the foregoing and the mutual
representations, warranties, covenants and agreements set forth herein and
therein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Representations and Warranties of the Stockholders. Each of the
Stockholders hereby represents and warrants to Siemens and Acquisition,
severally and not jointly, as follows:
(a) Such Stockholder is the record and beneficial owner of the
shares of capital stock of the Company (as may be adjusted from time to time
pursuant to Section 7 hereof, the "Shares") set forth opposite the Stockholder's
name on Annex I to this Agreement.
(b) Such Stockholder has the legal capacity to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
(c) This Agreement has been duly authorized by all requisite
action (corporate, partnership or other) on the part of such Stockholder, has
been validly executed and delivered by such Stockholder and constitutes the
legal, valid and binding obligation of such Stockholder, enforceable against
such Stockholder in accordance with its terms, except as limited by bankruptcy,
insolvency, reorganization, moratorium or other laws affecting enforcement of
creditors' rights generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
(d) The execution and delivery of this Agreement by such
Stockholder do not, and the performance by such Stockholder of the Stockholder's
obligations under this Agreement will not,
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(i) conflict with, result in a violation or breach of, constitute (with or
without notice or lapse of time or both) a default under, result in or give to
any person any right of termination, cancellation, modification or acceleration
of, or result in the creation or imposition of any Lien upon any of the assets
or properties of such Stockholder under, any of the terms, conditions or
provisions of (A) the certificate or article of incorporation or bylaws or other
comparable organizational documents of the Stockholder if applicable or (B) (x)
any law or order of any governmental or regulatory authority applicable to such
Stockholder or any of the Stockholder's assets or properties, or (y) any
contract to which the Stockholder is a party or by which the Stockholder or any
of the Stockholder's assets or properties is bound, excluding from the foregoing
clauses (x) and (y) conflicts, violations, breaches, defaults, terminations,
modifications, accelerations and creations and impositions of Liens which,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the ability of the Stockholder to consummate the
transactions contemplated by this Agreement, or (ii) require any filing by the
Stockholder with, or any permit, authorization, consent or approval of, any
governmental or regulatory authority or any third party.
(e) The Shares and the certificates representing the Shares
owned by such Stockholder are now and at all times during the term hereof will
be held by such Stockholder, or by a nominee or custodian for the benefit of
such Stockholder, free and clear of all liens, claims, security interests,
proxies, voting trusts or agreements, understandings or arrangements or any
other encumbrances whatsoever, except for any such encumbrances or proxies
arising hereunder, and not subject to any preemptive rights.
2. Representations and Warranties of Siemens and Acquisition. Each of
Siemens and Acquisition hereby represents and warrants to the Stockholders as
follows:
(a) Each of Siemens and Acquisition is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and each of them has full corporate power and authority to enter into
this Agreement and to consummate the transactions contemplated hereby and has
taken all necessary corporate action to authorize the execution, delivery and
performance of this Agreement.
(b) This Agreement has been duly authorized, executed and
delivered by each of Siemens and Acquisition and constitutes the legal, valid
and binding obligation of each of Siemens and Acquisition, enforceable against
each of them in accordance with its terms, except as limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
enforcement of creditors' rights generally and by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(c) The execution and delivery of this Agreement by Siemens
and Acquisition do not, and the performance by Siemens and Acquisition of their
obligations hereunder and the consummation of the transactions contemplated
hereby will not, (i) conflict with, result in a violation or breach of,
constitute (with or without notice or lapse of time or both) a default under,
result in or give to any person any right of termination, cancellation,
modification or acceleration of, or result in the creation or imposition of any
Lien upon any of the assets or properties of Siemens or Acquisition under, any
of the terms, conditions or provisions of (A) the certificates or articles of
incorporation or bylaws of Siemens or Acquisition or (B) (x) any law or order of
any governmental or regulatory authority applicable to Siemens or Acquisition or
any of their respective assets or properties, or (y) any contract to which
Siemens or Acquisition is a party or by which Siemens or Acquisition or any of
their respective assets or properties is bound, excluding from the foregoing
clauses (x) and (y) conflicts, violations, breaches, defaults, terminations,
modifications, accelerations and creations and impositions of Liens which,
individually or in the aggregate, could not be reasonably expected to have a
material adverse effect on the ability of Siemens or Acquisition to consummate
the transactions contemplated by this Agreement, or (ii) require
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any filing by Siemens or Acquisition with, or any permit, authorization, consent
or approval of, any governmental or regulatory authority.
3. Grant of Options.
(a) Each Stockholder hereby irrevocably grants to Acquisition
an exclusive option (the "Call Option") to purchase all Shares of such
Stockholder at the Merger Price per Share specified in Section 2.1(c) of the
Merger Agreement (the "Option Price"), which Option shall be exercisable by
Acquisition at any time after the date hereof and prior to the termination of
this Agreement.
(b) If (i) the Information Statement has been filed with the
SEC in preliminary form in accordance with Section 5.4 of the Merger Agreement;
(ii) a period of twelve days has elapsed following such filing; (iii) the
Company has been advised by the staff of the SEC that it is in the process of
reviewing the Information Statement and notwithstanding the Company's reasonable
efforts that review has not been completed; and (iv) all of the conditions
described in Section 6.1 of the Merger Agreement (other than Section 6.1(e))
have been satisfied, then the Stockholders shall have the option (the "Put
Option", and together with the Call Option, the "Options") to require
Acquisition to purchase from the Stockholders all, but not less than all, of the
Shares of each Stockholder at the Option Price. The Put Option may be exercised
by the Stockholders at any time beginning on the date on which the conditions
specified in clauses (i) through (iv) of the preceding sentence are satisfied
until this Agreement is terminated.
(c) To exercise an Option, the exercising party shall send a
written notice ("Exercise Notice") to each other party specifying the place and
the time (which shall be not less than two business days and not more than four
business days after the date of the Exercise Notice) for the closing of the
purchase and sale of the Shares in accordance with the exercise of the Option.
The closing of the purchase and sale of the Shares (the "Option Closing")
pursuant to the exercise of the Option shall take place at the place and at the
time designated by the exercising party in the Exercise Notice. The obligation
of Siemens or its designee to purchase the Shares at the Option Closing shall be
subject to the conditions that (i) all of the conditions described in Section
6.1 of the Merger Agreement (other than Section 6.1(e)) shall have been
satisfied and (ii) proper arrangements shall have been made to give effect to
the provisions of Section 1.6 of the Merger Agreement, and the securities law
requirements described in Section 1.6(b) shall have been satisfied.
(d) At the Option Closing, each Stockholder shall sell,
assign, convey and transfer to Acquisition, each such Stockholder's Shares, free
and clear of any and all liens, claims, security interests, encumbrances,
options or adverse claims whatsoever, and each Stockholder shall deliver or
cause to be delivered to Acquisition a certificate or certificates representing
the number of Shares to be delivered by such Stockholder at the Option Closing,
duly endorsed, or accompanied by stock powers duly executed in blank, with all
required transfer tax stamps affixed thereto. Siemens shall procure that the
applicable portions of the Option Price are paid not later than the dates the
corresponding portions of the Merger Price per Share first are payable under the
Merger Agreement. Payment of each amount will be by wire transfer or certified
or bank cashier's check or checks.
(e) In the event of any change in the Company's capital stock
by reason of any stock dividend, stock split, merger, consolidation,
recapitalization, combination, conversion, exchange of shares or dividend or
other change in the corporate or capital structure of the Company, which would
have the effect of diluting or changing Acquisition's rights hereunder, the
number and kind of shares or securities subject to the Options and the Option
Price shall be appropriately and equitably adjusted so that (i) Acquisition
shall receive, at the Option Closing, the number and class of shares or other
securities or property that Acquisition would have received and (ii) the
Stockholders shall receive, at the Option
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Closing, the consideration they would have received in respect of the Shares
purchasable upon exercise of the Options if the Options had been exercised
immediately prior to such event.
4. Voting. Each of the Stockholders hereby agrees that such
Stockholder: (i) will vote all Shares owned by the Stockholder in favor of the
Merger and the Merger Agreement, at any meeting of the Company's stockholders,
or, if requested by Siemens or Acquisition, execute and deliver written consents
to the same effect; (ii) will provide all notices and perform all actions
necessary for the consummation of the transactions contemplated by the Merger
Agreement; and (iii) will vote against, and will not vote or grant any consent
in favor of, or that would facilitate, any Acquisition Transaction other than
the Merger and the other transactions contemplated by the Merger Agreement.
5. Transfer of the Shares. Prior to the termination of this Agreement,
except as otherwise provided in this Agreement, none of the Stockholders shall:
(i) transfer (which term shall include, without limitation, for the purposes of
this Agreement, any sale, gift, pledge or other disposition), or consent to any
transfer of, any or all of the Shares; (ii) enter into any contract, option or
other agreement or understanding with respect to any transfer of any or all of
the Shares or any interest therein; (iii) grant any proxy, power-of-attorney or
other authorization or consent in or with respect to the Shares; (iv) deposit
the Shares into a voting trust or enter into a voting agreement or arrangement
with respect to the Shares; or (v) take any other action that would in any way
restrict, limit or interfere with the performance of such Stockholder's
obligations hereunder or the transactions contemplated hereby. Acquisition
hereby agrees not to transfer any Shares purchased upon exercise of an Option
until this Agreement has terminated.
6. Grant of Irrevocable Proxy; Appointment of Proxy.
(a) Each of the Stockholders hereby irrevocably grants to, and
appoints, Siemens and any nominee thereof, its proxy and attorney-in-fact (with
full power of substitution), for and in the name, place, and stead of such
Stockholder, to vote such Stockholder's Shares, or grant a consent, waiver or
approval in respect of such Stockholder's Shares, in connection with any meeting
of the Stockholders of the Company or otherwise, (i) in favor of the Merger and
the other transactions and actions contemplated by the Merger Agreement, and
(ii) against any action or agreement which would impede, interfere with or
prevent the Merger, including any Acquisition Transaction other than the Merger.
(b) Each of the Stockholders represents that any proxies
heretofore given in respect of the Shares are not irrevocable, and that such
proxies are hereby revoked.
(c) Each of the Stockholders hereby affirms that the proxy set
forth in this Section 6 is irrevocable and is given in connection with the
execution of the Merger Agreement, and that such irrevocable proxy is given to
secure the performances of the duties of such Stockholder under this Agreement.
Each Stockholder hereby further affirms that the irrevocable proxy granted
hereby is coupled with an interest in the Shares and, except as set forth in
Section 11 of this Agreement, is intended to be irrevocable in accordance with
the provisions of Section 212(e) of the Delaware General Corporation Law.
7. Certain Events. In the event of any stock split, stock dividend,
merger, reorganization, recapitalization or other change in the capital
structure of the Company affecting the Shares or the acquisition of additional
shares of capital stock or other securities or rights of the Company by any
Stockholder, the number of Shares shall be adjusted appropriately, and this
Agreement and the rights and obligations hereunder shall attach to any
additional shares of Company Common Stock or other securities or rights of the
Company issued to or acquired by any such Stockholder.
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(a) Drag-Along Notices. To the extent applicable to such
Stockholder, each Stockholder hereby agrees that such Stockholder (i) shall
deliver all notices required to be delivered by that certain Stockholders
Agreement, dated December 10, 1993, between Dort X. Xxxxxxx, III, Entex
Associates, L.P. and other signatories thereto, in order to exercise the
drag-along rights granted under that agreement to require the stockholders of
the Company party thereto to sell their shares to Acquisition at the Option
Price per share and (ii) thereafter shall use its reasonable best efforts to
enforce (and shall not grant or enter into any waiver or modification with
respect to) such drag-along rights; provided, however, that no Stockholder shall
be required to incur any material expense or liability or commence any legal
proceeding.
8. Certain Other Agreements. From the date of this Agreement until the
earlier of (i) the termination of this Agreement, or (ii) the Measurement Date,
none of the Stockholders shall, and none of the Stockholders shall authorize or
permit any advisor or representative retained by or acting for or on behalf of
any such Stockholder to, directly or indirectly, (i) take any action to
knowingly solicit, initiate, continue, facilitate or encourage (including by way
of furnishing or disclosing non-public information) any offer or proposal for an
Acquisition Transaction, other than the transactions contemplated by the Merger
Agreement or by this Agreement or (ii) knowingly engage in negotiations,
discussions or communications regarding or disclose any information relating to
the Company or afford access to the properties, books or records of the Company
to any person, corporation, partnership or other entity or group that may be
considering making or has made, a proposal for an Acquisition Transaction.
9. Further Assurances. Each of the Stockholders shall, upon request of
Siemens or Acquisition, execute and deliver any additional documents and take
such further actions as may reasonably be deemed by Siemens or Acquisition to be
necessary or desirable to carry out the provisions hereof and to vest in Siemens
the power to vote, grant consents and grant waivers with respect to the Shares
as contemplated by Section 6 of this Agreement.
10. Termination. Except as otherwise provided in this Agreement, this
Agreement, and all rights and obligations of the parties hereunder, shall
terminate immediately upon the earlier of (i) the acquisition by Siemens,
through Acquisition or otherwise, of all the Shares; (ii) if the Options have
not been exercised, the termination of the Merger Agreement in accordance with
its terms; or (iii) the Effective Time; provided, however, that Section 9 shall
survive any termination of this Agreement pursuant to clause (i) of this
sentence.
11. Public Announcements. Each of the Stockholders, Siemens and
Acquisition agrees that it will not issue any press release or otherwise make
any public statement with respect to this Agreement or the transactions
contemplated hereby without the prior consent of the other parties, which
consents shall not be unreasonably withheld or delayed; provided, however, that
such disclosure can be made without obtaining such prior consent if (i) the
disclosure is required by law, and (ii) the party making such disclosure has
first used its best efforts to consult with the other party about the form and
substance of such disclosure.
12. Miscellaneous.
(a) All notices, requests and other communications hereunder
must be in writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or mailed (first class postage prepaid)
to the parties at the following addresses or facsimile numbers:
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(1) if to any or all of the Stockholders, to
them in care of:
Dort X. Xxxxxxx, III
The Airlie Group
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxx
and
(2) if to Siemens or Acquisition, to:
Siemens Corporation
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
with a copy to:
Xxxxxxxx Chance Xxxxxx & Xxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxx
(3) if to the Company, to:
Entex Information Services, Inc.
Xxx Xxxxxxxxxxxxx Xxxxx
Xxx Xxxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxxx
with a copy to:
Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxx
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All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section, be deemed given upon receipt, and (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other person to whom a
copy of such notice is to be delivered pursuant to this Section). Any party from
time to time may change its address, facsimile number or other information for
the purpose of notices to that party by giving notice specifying such change to
the other parties hereto.
(b) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
(c) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
be considered one and the same agreement.
(d) This Agreement constitutes the entire agreement, and
supersedes all prior agreements and understandings, whether written and oral,
among the parties hereto with respect to the subject matter hereof.
(e) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware without giving effect to the
principles of conflicts of laws thereof.
(f) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto (whether by
operation of law or otherwise) without the prior written consent of the other
parties, and any such purported assignment shall be null and void; provided,
however, that either of Siemens or Acquisition may, without the prior written
consent of any Stockholder, assign its rights and obligations to any of its
direct or indirect wholly owned subsidiaries. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of and be enforceable
by, the parties and their respective successors and assigns, and the provisions
of this Agreement are not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
(g) If any term, provision, covenant or restriction herein is
held by a court of competent jurisdiction or other authority to be invalid, void
or unenforceable or against its regulatory policy, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated.
(h) Each of the parties hereto acknowledges and agrees that in
the event of any breach of this Agreement, each non-breaching party would be
irreparably and immediately harmed and could not be made whole by monetary
damages. It is accordingly agreed that the parties hereto (i) will waive, in any
action for specific performance, the defense of adequacy of a remedy at law and
(ii) shall be entitled, in addition to any other remedy to which they may be
entitled at law or in equity, to compel specific performance of this Agreement.
(i) No amendment, modification or waiver in respect to this
Agreement shall be effective unless it shall be in writing and signed by each
party hereto.
(j) No person who is or becomes (during the term hereof) a
director or officer of the Company makes any agreement or understanding herein
in his or her capacity as such director or officer, and nothing herein shall
limit or affect any action taken by any Stockholder in his or her capacity as an
officer or director of the Company in connection with the Company's rights under
the Merger Agreement.
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IN WITNESS WHEREOF, each of Siemens, Acquisition and the Stockholders
have caused this Agreement to be duly executed and delivered as of the date
first written above.
SIEMENS CORPORATION
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President, Corporate Development
XXXXXX ACQUISITION CORP.
By: /s/ Xxxxxxx Xxxxxxxx
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Name: Xxxxxxx Xxxxxxxx
Title: Vice President
/s/ Dort X. Xxxxxxx III
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DORT X. XXXXXXX III
ENTEX ASSOCIATES L.P.
By its General Partner, the Xxxxxx Group, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: President
/s/ Xxxx X. XxXxxxx, Xx.
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XXXX X. XXXXXXX, XX.
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ANNEX I
Ownership of Shares
HOLDER NUMBER OF SHARES
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Dort X. Xxxxxxx, III 2,669,653
Entex Associates L.P. 21,407,739
Xxxx X. XxXxxxx, Xx. 642,204
