EXHIBIT 2.1
AGREEMENT AND PLAN OF REORGANIZATION
AMONG
WESTERN MULTIPLEX CORPORATION,
WALNUT-PINE MERGER CORP.
AND
PROXIM, INC.
DATED AS OF JANUARY 16, 2002
TABLE OF CONTENTS
PAGE
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ARTICLE I THE MERGER............................................................................ 2
1.1 The Merger....................................................................... 2
1.2 Effective Time; Closing.......................................................... 2
1.3 Effect of the Merger............................................................. 2
1.4 Certificate of Incorporation; Bylaws............................................. 2
1.5 Effect on Capital Stock.......................................................... 2
1.6 Surrender of Certificates........................................................ 4
1.7 No Further Ownership Rights in Proxim Common Stock............................... 6
1.8 Lost, Stolen or Destroyed Certificates........................................... 6
1.9 Tax Consequences................................................................. 6
1.10 Taking of Necessary Action; Further Action....................................... 6
ARTICLE II REPRESENTATIONS AND WARRANTIES OF PROXIM............................................. 6
2.1 Organization of Proxim........................................................... 7
2.2 Proxim Capital Structure......................................................... 7
2.3 Obligations With Respect to Capital Stock........................................ 7
2.4 Authority........................................................................ 8
2.5 SEC Filings; Proxim Financial Statements......................................... 9
2.6 Absence of Certain Changes or Events............................................. 10
2.7 Taxes............................................................................ 10
2.8 Proxim Intellectual Property..................................................... 11
2.9 Compliance; Permits; Restrictions................................................ 15
2.10 Litigation....................................................................... 15
2.11 Brokers' and Finders' Fees....................................................... 16
2.12 Employee Benefit Plans........................................................... 16
2.13 Absence of Liens and Encumbrances................................................ 18
2.14 Environmental Matters............................................................ 18
2.15 Labor Matters.................................................................... 19
2.16 Agreements, Contracts and Commitments............................................ 19
2.17 Title to Proxim Properties....................................................... 21
2.18 Statements; Joint Proxy Statement/Prospectus..................................... 21
2.19 Board Approval................................................................... 22
2.20 Opinion of Financial Advisors.................................................... 22
2.21 Vote Required.................................................................... 22
2.22 State Takeover Statutes.......................................................... 22
2.23 Proxim Rights Agreement.......................................................... 22
ARTICLE III REPRESENTATIONS AND WARRANTIES OF WESTERN MULTIPLEX AND MERGER SUB.................. 23
3.1 Organization of Western Multiplex................................................ 23
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TABLE OF CONTENTS
(CONTINUED)
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3.2 Western Multiplex Capital Structure.............................................. 23
3.3 Obligations With Respect to Capital Stock........................................ 24
3.4 Authority........................................................................ 24
3.5 SEC Filings; Western Multiplex Financial Statements.............................. 25
3.6 Absence of Certain Changes or Events............................................. 26
3.7 Taxes............................................................................ 26
3.8 Western Multiplex Intellectual Property.......................................... 27
3.9 Compliance; Permits; Restrictions................................................ 31
3.10 Litigation....................................................................... 31
3.11 Brokers' and Finders' Fees....................................................... 31
3.12 Employee Benefit Plans........................................................... 31
3.13 Absence of Liens and Encumbrances................................................ 34
3.14 Environmental Matters............................................................ 34
3.15 Labor Matters.................................................................... 35
3.16 Agreements, Contracts and Commitments............................................ 35
3.17 Title to Western Multiplex Properties............................................ 36
3.18 Statements; Joint Proxy Statement/Prospectus..................................... 37
3.19 Board Approval................................................................... 37
3.20 Opinion of Financial Advisor..................................................... 37
3.21 Vote Required.................................................................... 38
3.22 State Takeover Statutes.......................................................... 38
ARTICLE IV CONDUCT PRIOR TO THE EFFECTIVE TIME.................................................. 38
4.1 Conduct of Business by Proxim.................................................... 38
4.2 Conduct of Business by Western Multiplex......................................... 41
ARTICLE V ADDITIONAL AGREEMENTS................................................................. 44
5.1 Prospectus/Proxy Statement; Registration Statement............................... 44
5.2 Meetings of Stockholders; Board Recommendation................................... 45
5.3 Acquisition Proposals............................................................ 46
5.4 Confidentiality; Access to Information; No Modification of
Representations, Warranties or Covenants......................................... 50
5.5 Public Disclosure................................................................ 50
5.6 Regulatory Filings; Reasonable Efforts........................................... 50
5.7 Notification of Certain Matters.................................................. 52
5.8 Third-Party Consents............................................................. 53
5.9 Stock Options and Employee Benefits.............................................. 53
5.10 Form S-8......................................................................... 54
5.11 Indemnification.................................................................. 54
5.12 Board of Directors and Executive Officers of Western Multiplex; Name Change...... 55
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TABLE OF CONTENTS
(CONTINUED)
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5.13 Nasdaq Listing................................................................... 55
5.14 Proxim Affiliates; Restrictive Legend............................................ 55
5.15 Treatment as Reorganization...................................................... 56
5.16 Section 16 Matters............................................................... 56
5.17 Assumption of Agreements......................................................... 56
5.18 Bylaws of Proxim................................................................. 56
5.19 Directors and Officers of the Surviving Corporation.............................. 56
ARTICLE VI CONDITIONS TO THE MERGER............................................................. 57
6.1 Conditions to Obligations of Each Party to Effect the Merger..................... 57
6.2 Additional Conditions to Obligations of Proxim................................... 58
6.3 Additional Conditions to the Obligations of Western Multiplex.................... 58
ARTICLE VII TERMINATION, AMENDMENT AND WAIVER................................................... 59
7.1 Termination...................................................................... 59
7.2 Notice of Termination; Effect of Termination..................................... 61
7.3 Fees and Expenses................................................................ 62
7.4 Amendment........................................................................ 64
7.5 Extension; Waiver................................................................ 64
ARTICLE VIII GENERAL PROVISIONS................................................................. 64
8.1 Non-Survival of Representations and Warranties................................... 64
8.2 Notices.......................................................................... 64
8.3 Interpretation; Knowledge........................................................ 65
8.4 Counterparts..................................................................... 66
8.5 Entire Agreement; Third-Party Beneficiaries...................................... 66
8.6 Severability..................................................................... 67
8.7 Other Remedies; Specific Performance............................................. 67
8.8 Governing Law.................................................................... 67
8.9 Rules of Construction............................................................ 67
8.10 Assignment....................................................................... 67
8.11 Waiver of Jury Trial............................................................. 67
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INDEX OF DEFINED TERMS
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Acquisition........................................................................... 63
Acquisition Proposal.................................................................. 49
Action................................................................................ 15
Affiliate............................................................................. 16
Agreement............................................................................. 1
Amended Stockholders' Agreement....................................................... 1
Atheros............................................................................... 56
Atheros OEM Agreement................................................................. 56
Board Recommendation.................................................................. 37
Broadview............................................................................. 16
Certificate of Merger................................................................. 2
Certificates.......................................................................... 4
Change of Recommendation.............................................................. 48
Closing............................................................................... 2
Closing Date.......................................................................... 2
Code.................................................................................. 2
Confidentiality Agreement............................................................. 50
Copyrights............................................................................ 12
Delaware Law.......................................................................... 1
DOJ................................................................................... 50
DOL................................................................................... 16
Effect................................................................................ 66
Effective Time........................................................................ 2
End Date.............................................................................. 59
ERISA................................................................................. 16
Exchange Act.......................................................................... 9
Exchange Agent........................................................................ 4
Exchange Ratio........................................................................ 3
FICA.................................................................................. 10
FTC................................................................................... 50
FUTA.................................................................................. 10
GAAP.................................................................................. 9
Governmental Entity................................................................... 8
Hazardous Material.................................................................... 18
Hazardous Materials Activities........................................................ 19
HSR Act............................................................................... 9
Indemnified Parties................................................................... 54
Intellectual Property................................................................. 11
IRS................................................................................... 16
Joint Proxy Statement/Prospectus...................................................... 21
XX Xxxxxx............................................................................. 16
Knowledge............................................................................. 66
Legal Requirement..................................................................... 8
Material Adverse Effect............................................................... 66
Merger................................................................................ 1
Merger Sub............................................................................ 1
Nasdaq................................................................................ 4
Necessary Consents.................................................................... 9
Patents............................................................................... 11
Person................................................................................ 66
Proxim................................................................................ 1
Proxim Affiliate...................................................................... 55
Proxim Affiliate Agreement............................................................ 56
Proxim Balance Sheet.................................................................. 9
Proxim Board Recommendation........................................................... 22
Proxim Common Stock................................................................... 3
Proxim Contracts...................................................................... 19
Proxim Designated Directors........................................................... 55
Proxim Disclosure Letter.............................................................. 6
Proxim Environmental Permits.......................................................... 19
Proxim Financials..................................................................... 9
Proxim Insider........................................................................ 56
Proxim Intellectual Property.......................................................... 12
Proxim Leases......................................................................... 21
Proxim Material IP Contracts.......................................................... 13
Proxim Options........................................................................ 3
Proxim Permits........................................................................ 15
Proxim Plans.......................................................................... 16
Proxim Purchase Plan.................................................................. 39
Proxim Registered Intellectual Property............................................... 12
Proxim Registered Intellectual Property Rights........................................ 12
Proxim Rights......................................................................... 22
Proxim Rights Agreement............................................................... 22
Proxim SEC Reports.................................................................... 9
Proxim Stock Option Plans............................................................. 3
Proxim Stockholder Approval........................................................... 8
Proxim Stockholders' Meeting.......................................................... 21
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INDEX OF DEFINED TERMS
(CONTINUED)
Proxim Termination Fee................................................................ 62
Proxim Voting Agreements.............................................................. 1
PTO................................................................................... 12
Registered Intellectual Property...................................................... 12
Registration Statement................................................................ 9
Returns............................................................................... 10
SEC................................................................................... 9
Securities Act........................................................................ 9
Share Issuance........................................................................ 1
Siemens............................................................................... 56
Siemens Technology License Agreement.................................................. 56
Stockholders' Meeting................................................................. 45
Superior Offer........................................................................ 49
Surviving Corporation................................................................. 2
Tax................................................................................... 10
Taxes................................................................................. 10
Trademarks............................................................................ 12
Triggering Event...................................................................... 61
Voting Agreements..................................................................... 1
Western Multiplex..................................................................... 1
Western Multiplex Balance Sheet....................................................... 26
Western Multiplex Board Recommendation................................................ 37
Western Multiplex Common Stock........................................................ 3
Western Multiplex Contracts........................................................... 35
Western Multiplex Designated Directors................................................ 55
Western Multiplex Disclosure Letter................................................... 23
Western Multiplex Environmental Permits............................................... 34
Western Multiplex Financials.......................................................... 25
Western Multiplex Intellectual Property............................................... 28
Western Multiplex Leases.............................................................. 37
Western Multiplex Material IP Contracts............................................... 29
Western Multiplex Permits............................................................. 31
Western Multiplex Plans............................................................... 32
Western Multiplex Purchase Plan....................................................... 54
Western Multiplex Registered Intellectual Property.................................... 28
Western Multiplex Registered Intellectual Property Rights............................. 28
Western Multiplex SEC Reports......................................................... 25
Western Multiplex Spin-Out............................................................ 30
Western Multiplex Stock Option Plans.................................................. 24
Western Multiplex Stockholder Approval................................................ 25
Western Multiplex Stockholders' Meeting............................................... 21
Western Multiplex Termination Fee..................................................... 62
Western Multiplex Voting Agreements................................................... 1
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INDEX OF EXHIBITS
Exhibit A Western Multiplex Voting Agreement
Exhibit B Proxim Voting Agreement
Exhibit C Amended and Restated Stockholders' Agreement
Exhibit D Form of Certificate of Incorporation of Surviving Corporation
Exhibit E Proxim Affiliate Agreement
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AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION (the "AGREEMENT") is made and
entered into as of January 16, 2002 among Western Multiplex Corporation, a
Delaware corporation ("WESTERN MULTIPLEX"), Walnut-Pine Merger Corp., a Delaware
corporation and a wholly owned direct subsidiary of Western Multiplex ("MERGER
SUB"), and Proxim, Inc., a Delaware corporation ("Proxim").
RECITALS
A. Upon the terms and subject to the conditions of this Agreement and in
accordance with the Delaware General Corporation Law ("DELAWARE LAW"), Western
Multiplex and Proxim will enter into a business combination transaction pursuant
to which Merger Sub will merge with and into Proxim (the "MERGER").
B. The Board of Directors of Western Multiplex (i) has determined that
the Merger is advisable, consistent with and in furtherance of the long-term
business strategy of Western Multiplex and fair to, and in the best interests
of, Western Multiplex and its stockholders, (ii) has approved this Agreement,
the Merger and the other transactions contemplated by this Agreement and (iii)
has approved and determined to recommend that the stockholders of Western
Multiplex vote to approve the issuance of shares of Western Multiplex Common
Stock (as defined below) to the stockholders of Proxim pursuant to the terms of
this Agreement (the "SHARE Issuance").
C. The Board of Directors of Proxim (i) has determined that the Merger
is consistent with and in furtherance of the long-term business strategy of
Proxim and fair to, and in the best interests of, Proxim and its stockholders,
(ii) has approved this Agreement, the Merger and the other transactions
contemplated by this Agreement and declared this Agreement advisable and (iii)
has determined to recommend the adoption of this Agreement to the stockholders
of Proxim.
D. Concurrently with the execution of this Agreement and as a condition
and inducement to Western Multiplex's and Proxim's willingness to enter into
this Agreement, certain affiliates of Western Multiplex are entering into voting
agreements in substantially the form attached hereto as Exhibit A (the "WESTERN
MULTIPLEX VOTING AGREEMENTS"), and certain affiliates of Proxim are entering
into voting agreements in substantially the form attached hereto as Exhibit B
(the "PROXIM VOTING AGREEMENTS" and, collectively with the Western Multiplex
Voting Agreements, the "VOTING AGREEMENTS").
E. Concurrently with the execution of this Agreement and as a condition
and inducement to Proxim's willingness to enter into this Agreement, WMC Holding
L.L.C. and GTI Acquisition Corporation are entering into an Amended and Restated
Stockholders' Agreement in substantially the form attached hereto as Exhibit C
(the "AMENDED STOCKHOLDERS' AGREEMENT"), such agreement to be effective upon
consummation of the Merger.
F. For United States federal income tax purposes, the parties intend, by
executing this Agreement, to adopt a plan of reorganization within the meaning
of Section 368 of the Internal Revenue Code of 1986, as amended (the "CODE").
NOW, THEREFORE, in consideration of the covenants, promises and
representations set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, 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 and the
applicable provisions of Delaware Law, Merger Sub shall be merged with and into
Proxim, the separate corporate existence of Merger Sub shall cease and Proxim
shall continue as the surviving corporation. Proxim as the surviving corporation
after the Merger is hereinafter sometimes referred to as the "SURVIVING
CORPORATION."
1.2 Effective Time; Closing. Subject to the provisions of this
Agreement, the parties hereto shall cause the Merger to be consummated by filing
a Certificate of Merger (the "CERTIFICATE OF MERGER") with the Secretary of
State of the State of Delaware in accordance with the relevant provisions of
Delaware Law (the time of such filing with the Secretary of State of the State
of Delaware (or such later time as may be agreed in writing by the parties and
specified in the Certificate of Merger) being the "EFFECTIVE TIME") as soon as
practicable on or after the Closing Date (as herein defined). The closing of the
Merger (the "CLOSING") shall take place at the offices of Xxxxxx Xxxxxxx
Xxxxxxxx & Xxxxxx, Professional Corporation, located at 000 Xxxx Xxxx Xxxx, Xxxx
Xxxx, Xxxxxxxxxx, at a time and date to be specified by the parties, which shall
be no later than the second business day after the satisfaction or waiver of the
conditions set forth in ARTICLE VI, or at such other time, date and location as
the parties hereto agree in writing (the "CLOSING DATE").
1.3 Effect of the Merger. At the Effective Time, the effect of the
Merger shall be as provided in this Agreement and the applicable provisions of
Delaware Law. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time all the property, rights, privileges, powers and
franchises of Proxim and Merger Sub shall vest in the Surviving Corporation, and
all debts, liabilities and duties of Proxim and Merger Sub shall become the
debts, liabilities and duties of the Surviving Corporation.
1.4 Certificate of Incorporation. At the Effective Time, the Certificate
of Incorporation of the Surviving Corporation shall be amended so as to read in
its entirety in the form attached hereto as Exhibit D.
1.5 Effect on Capital Stock. Subject to the terms and conditions of this
Agreement, at the Effective Time, by virtue of the Merger and without any action
on the part of Merger Sub, Proxim or the holders of any of the following
securities, the following shall occur:
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(a) Conversion of Proxim Common Stock. Each share of common
stock, $0.001 par value per share, of Proxim (the "PROXIM COMMON STOCK"), issued
and outstanding immediately prior to the Effective Time (other than any shares
of Proxim Common Stock to be canceled pursuant to Section 2.23), together with
any associated Proxim Rights (as defined in Section 2.23) under the Proxim
Rights Agreement (as defined in Section 2.23), will be canceled and extinguished
and automatically converted (subject to Sections 1.5(e) and 1.5(f)) into the
right to receive 1.8896 (the "EXCHANGE RATIO") shares of Class A common stock,
par value $0.01 per share, of Western Multiplex (the "WESTERN MULTIPLEX COMMON
STOCK") upon surrender of the certificate representing such share of Proxim
Common Stock in the manner provided in Section 1.6 (or in the case of a lost,
stolen or destroyed certificate, upon delivery of an affidavit (and bond, if
required)) in the manner provided in Section 1.8).
(b) Cancellation of Treasury and Western Multiplex-Owned Stock.
Each share of Proxim Common Stock held in the treasury of Proxim or owned by
Merger Sub or Western Multiplex immediately prior to the Effective Time shall be
canceled and extinguished without any conversion thereof.
(c) Stock Options. The parties shall take all requisite action
such that, at the Effective Time, all options to purchase Proxim Common Stock
then outstanding (the "PROXIM OPTIONS") under Proxim's 1986 Stock Option Plan,
1994 Director Option Plan, 1995 Long-Term Incentive Plan and 1999 Nonstatutory
Stock Option Plan (collectively, the "PROXIM STOCK OPTION PLANS") shall be
assumed by Western Multiplex in accordance with Section 5.9 hereof. Prior to the
Closing Date, the Board of Directors of Western Multiplex shall take all
necessary action to assume and adopt, as of the Closing Date, Proxim's 1995
Long-Term Incentive Plan, and shall have the discretion to adopt, as of the
Closing Date, any other Proxim Stock Option Plan. Rights outstanding under
Proxim's 1993 Employee Stock Purchase Plan shall be treated as set forth in
Section 5.9 hereof.
(d) Capital Stock of Merger Sub. Each share of common stock,
$0.01 par value per share, of Merger Sub issued and outstanding immediately
prior to the Effective Time shall be converted into and exchanged for one
validly issued, fully paid and nonassessable share of common stock, $0.01 par
value, of the Surviving Corporation. Each stock certificate of Merger Sub
evidencing ownership of any such shares shall continue to evidence ownership of
such shares of capital stock of the Surviving Corporation.
(e) Adjustments to Exchange Ratio. The Exchange Ratio shall be
adjusted to reflect appropriately the effect of any stock split, reverse stock
split, stock dividend (including any dividend or distribution of securities
convertible into Western Multiplex Common Stock or Proxim Common Stock),
extraordinary cash dividends, reorganization, recapitalization,
reclassification, combination, exchange of shares or other like change with
respect to Western Multiplex Common Stock or Proxim Common Stock occurring on or
after the date hereof and prior to the Effective Time.
(f) Fractional Shares. No fraction of a share of Western
Multiplex Common Stock will be issued by virtue of the Merger, but in lieu
thereof, each holder of shares of Proxim
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Common Stock who would otherwise be entitled to a fraction of a share of Western
Multiplex Common Stock (after aggregating all fractional shares of Western
Multiplex Common Stock to be received by such holder) shall receive from Western
Multiplex an amount of cash (rounded to the nearest whole cent), without
interest, equal to the product of (i) such fraction, multiplied by (ii) the
average closing price of one share of Western Multiplex Common Stock for the
five (5) most recent days that Western Multiplex Common Stock has traded ending
on the trading day immediately prior to the Effective Time, as reported on the
Nasdaq National Market System ("NASDAQ").
1.6 Surrender of Certificates.
(a) Exchange Agent. Western Multiplex shall select an institution
reasonably satisfactory to Proxim to act as the exchange agent (the "EXCHANGE
AGENT") in the Merger.
(b) Western Multiplex to Provide Common Stock. Promptly after the
Effective Time, Western Multiplex shall make available to the Exchange Agent for
exchange in accordance with this Article I, (i) certificates for the shares of
Western Multiplex Common Stock issuable pursuant to Section 1.5 in exchange for
outstanding shares of Proxim Common Stock, (ii) cash in an amount sufficient for
payment in lieu of fractional shares pursuant to Section 1.5(f) and (iii) any
dividends or distributions to which holders of shares of Proxim Common Stock may
be entitled pursuant to Section 1.6(d).
(c) Exchange Procedures. Promptly after the Effective Time,
Western Multiplex shall cause the Exchange Agent to mail to each holder of
record (as of the Effective Time) of a certificate or certificates (the
"CERTIFICATES") that immediately prior to the Effective Time represented
outstanding shares of Proxim Common Stock whose shares were converted into the
right to receive shares of Western Multiplex Common Stock pursuant to Section
1.5, cash in lieu of any fractional shares pursuant to Section 1.5(f) and any
dividends or other distributions pursuant to Section 1.6(d), (i) a letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent and shall be in such form and have such other
provisions as Western Multiplex may reasonably specify) and (ii) instructions
for use in effecting the surrender of the Certificates in exchange for
certificates representing whole shares of Western Multiplex Common Stock, cash
in lieu of any fractional shares pursuant to Section 1.5(f) and any dividends or
other distributions pursuant to Section 1.6(d). Upon surrender of Certificates
for cancellation to the Exchange Agent or to such other agent or agents as may
be appointed by Western Multiplex, together with such letter of transmittal,
duly completed and validly executed in accordance with the instructions thereto
and such other documents as may reasonably be required by the Exchange Agent,
the holders of such Certificates shall be entitled to receive in exchange
therefor certificates representing the number of whole shares of Western
Multiplex Common Stock (after taking into account all Certificates surrendered
by such holder) to which such holder is entitled pursuant to Section 1.5(a)
(which, other than for Proxim Affiliates shall be in uncertificated book entry
form unless a physical certificate is requested or is otherwise required by
applicable law rule or regulation), payment in lieu of fractional shares which
such holder has the right to receive pursuant to Section 1.5(f) and any
dividends or distributions payable pursuant to Section 1.6(d), and the
Certificates so surrendered shall forthwith
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be canceled. Until so surrendered, outstanding Certificates will be deemed from
and after the Effective Time, for all corporate purposes, to evidence only the
right to receive, upon due surrender thereof, the number of full shares of
Western Multiplex Common Stock issuable pursuant to Section 1.5, cash in lieu of
the issuance of any fractional shares in accordance with Section 1.5(f) and any
dividends or distributions payable pursuant to Section 1.6(d).
(d) Distributions With Respect to Unexchanged Shares. No
dividends or other distributions declared or made after the date of this
Agreement with respect to Western Multiplex Common Stock with a record date
after the Effective Time and no payment in lieu of fractional shares pursuant to
Section 1.5(f) will be paid to the holders of any unsurrendered Certificates
with respect to the shares of Western Multiplex Common Stock issuable pursuant
to Section 1.5, until such Certificates shall have been duly surrendered.
Subject to applicable law, following surrender of any such Certificates, the
Exchange Agent or any other agent designated by Western Multiplex shall deliver
to the holders thereof, without interest, (i) promptly after such surrender, the
number of whole shares of Western Multiplex Common Stock issued in exchange
therefor along with payment in lieu of fractional shares pursuant to Section
1.5(f) and the amount of any such dividends or other distributions with a record
date after the Effective Time and theretofore paid with respect to such whole
shares of Western Multiplex Common Stock and (ii) at the appropriate payment
date, the amount of dividends or other distributions with a record date after
the Effective Time and a payment date subsequent to such surrender payable with
respect to such whole shares of Western Multiplex Common Stock.
(e) Transfers of Ownership. If certificates for shares of Western
Multiplex Common Stock are to be issued in a name other than that in which the
Certificates surrendered in exchange therefor are registered, it will be a
condition of the issuance thereof that the Certificates so surrendered will be
properly endorsed and otherwise in proper form for transfer and that the persons
requesting such exchange will have paid to Western Multiplex or any agent
designated by it any transfer or other taxes required by reason of the issuance
of certificates for shares of Western Multiplex Common Stock in any name other
than that of the registered holders of the Certificates surrendered, or
established to the satisfaction of Western Multiplex or any agent designated by
it that such tax has been paid or is not payable.
(f) Required Withholding. Each of Western Multiplex, the Exchange
Agent and the Surviving Corporation shall be entitled to deduct and withhold
from any consideration payable or otherwise deliverable pursuant to this
Agreement to any former holder of Proxim Common Stock such amounts as may be
required to be deducted or withheld therefrom under the Code or under any
provision of state, local or foreign Tax law or under any other applicable legal
requirement. To the extent such amounts are so deducted or withheld, the amount
of such consideration shall be treated for all purposes under this Agreement as
having been paid to the person to whom such consideration would otherwise have
been paid.
(g) No Liability. Notwithstanding anything to the contrary in
this Section 1.6, none of the Exchange Agent, Western Multiplex, the Surviving
Corporation or any party hereto shall be liable to a holder of shares of Western
Multiplex Common Stock or Proxim Common Stock for
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any amount properly paid to a public official pursuant to any applicable
abandoned property, escheat or similar law.
1.7 No Further Ownership Rights in Proxim Common Stock. All shares of
Western Multiplex Common Stock issued in accordance with the terms hereof
(including any cash paid in respect thereof pursuant to Section 1.5(f) and
1.6(d)) shall be deemed to have been issued in full satisfaction of all rights
pertaining to such shares of Proxim Common Stock, and there shall be no further
registration of transfers on the records of the Surviving Corporation of shares
of Proxim Common Stock that 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.
1.8 Lost, Stolen or Destroyed Certificates. In the event any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall
issue 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
Western Multiplex Common Stock, cash for fractional shares, if any, as may be
required pursuant to Section 1.5(f) and any dividends or distributions payable
pursuant to Section 1.6(d); provided, however, that Western Multiplex 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 Western Multiplex, Proxim or the Exchange Agent with respect to the
Certificates alleged to have been lost, stolen or destroyed.
1.9 Tax Consequences. It is intended by the parties hereto that the
Merger shall constitute a reorganization within the meaning of Section 368 of
the Code. The parties hereto adopt this Agreement as a "plan of reorganization"
within the meaning of Treasury Regulations Sections 1.368-2(g) and 1.368-3(a).
1.10 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 possession to all assets, property, rights, privileges, powers
and franchises of Proxim and Merger Sub, the officers and directors of Proxim
and Merger Sub will take all such lawful and necessary action.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF PROXIM
Proxim represents and warrants to Western Multiplex and Merger Sub,
subject to the exceptions specifically disclosed in writing in the disclosure
letter supplied by Proxim to Western Multiplex (the "PROXIM DISCLOSURE LETTER")
and specific statements of historical fact disclosed in the Proxim SEC Reports
(to the extent the relevance of the disclosure in the Proxim SEC Report to a
representation and warranty is reasonably apparent), as follows:
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2.1 Organization of Proxim.
(a) Proxim and each of its subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation; has the corporate power and authority to own,
lease and operate its assets and property and to carry on its business as now
being conducted and as proposed to be conducted; and is duly qualified to do
business and in good standing as a foreign corporation in each jurisdiction in
which the failure to be so qualified, individually or in the aggregate, would
have a Material Adverse Effect (as defined in Section 8.3) on Proxim.
(b) Proxim has delivered to Western Multiplex a true and complete
list of all of Proxim's subsidiaries, indicating the jurisdiction of
incorporation of each subsidiary and Proxim's equity interest therein.
(c) Proxim has delivered or made available to Western Multiplex a
true and correct copy of the Certificate of Incorporation and bylaws of Proxim
and similar governing instruments of each of its material subsidiaries, each as
amended to date, and each such instrument is in full force and effect. Neither
Proxim nor any of its subsidiaries is in violation of any of the provisions of
its Certificate of Incorporation or bylaws or equivalent governing instruments.
2.2 Proxim Capital Structure. As of January 11, 2002, the authorized
capital stock of Proxim consisted of 100,000,000 shares of Proxim Common Stock,
of which 31,366,656 shares were issued and outstanding and 5,000,000 shares of
Preferred Stock, par value $0.001 per share, of which no shares are issued or
outstanding. All outstanding shares of Proxim Common Stock are duly authorized,
validly issued, fully paid and non-assessable and are not subject to preemptive
rights created by statute, the Certificate of Incorporation or Bylaws of Proxim
or any agreement or document to which Proxim is a party or by which it is bound.
As of January 11, 2002, Proxim had reserved an aggregate of 14,162,812 shares of
Proxim Common Stock, net of exercises, for issuance to employees, consultants
and non-employee directors pursuant to the Proxim Stock Option Plans, under
which options are outstanding for 8,579,089 shares and under which 5,583,723
shares are available for grant. All shares of Proxim Common Stock subject to
issuance as aforesaid, upon issuance on the terms and conditions specified in
the instruments pursuant to which they are issuable, would be duly authorized,
validly issued, fully paid and nonassessable.
2.3 Obligations With Respect to Capital Stock. As of the date hereof,
except as set forth in Section 2.2, there are no equity securities, partnership
interests or similar ownership interests of any class of Proxim, or any
securities exchangeable or convertible into or exercisable for such equity
securities, partnership interests or similar ownership interests issued,
reserved for issuance or outstanding. As of the date hereof, except for
securities Proxim owns, directly or indirectly through one or more subsidiaries,
there are no equity securities, partnership interests or similar ownership
interests of any class of any subsidiary of Proxim, or any security exchangeable
or convertible into or exercisable for such equity securities, partnership
interests or similar ownership interests issued, reserved for issuance or
outstanding. As of the date hereof, except as set forth in Section 2.2, there
are no options, warrants, equity securities, partnership interests or similar
ownership interests, calls, rights (including preemptive rights), commitments or
agreements of any character to which Proxim
-7-
or any of its subsidiaries is a party or by which it is bound obligating Proxim
or any of its subsidiaries to issue, deliver or sell, or cause to be issued,
delivered or sold, or repurchase, redeem or otherwise acquire, or cause the
repurchase, redemption or acquisition, of any shares of capital stock of Proxim
or any of its subsidiaries or obligating Proxim or any of its subsidiaries to
grant, extend, accelerate the vesting of or enter into any such option, warrant,
equity security, partnership interest or similar ownership interest, call,
right, commitment or agreement. There are no registration rights and, to the
Knowledge of Proxim there are no voting trusts, proxies or other agreements or
understandings with respect to any equity security of any class of Proxim or
with respect to any equity security, partnership interest or similar ownership
interest of any class of any of its subsidiaries.
2.4 Authority.
(a) Proxim has all requisite corporate power and authority to
enter into 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 Proxim, subject only to the adoption of this
Agreement by Proxim's stockholders and the filing and recordation of the
Certificate of Merger pursuant to Delaware Law. This Agreement has been duly
executed and delivered by Proxim and, assuming the due authorization, execution
and delivery by Western Multiplex and Merger Sub, constitutes the valid and
binding obligation of Proxim, enforceable in accordance with its terms, except
as enforceability may be limited by bankruptcy and other similar laws and
general principles of equity. The execution and delivery of this Agreement by
Proxim does not, and the performance of this Agreement by Proxim will not, (i)
conflict with or violate the Certificate of Incorporation or bylaws of Proxim or
the equivalent organizational documents of any of its subsidiaries, (ii) subject
to obtaining the adoption of this Agreement by Proxim's stockholders as
contemplated in Section 5.2 (the "PROXIM STOCKHOLDER APPROVAL") and compliance
with the requirements set forth in Section 2.4(b) below, conflict with or
violate any law, rule, regulation, order, judgment or decree (each a "LEGAL
REQUIREMENT") applicable to Proxim or any of its subsidiaries or by which its or
any of their respective properties is bound or affected, or (iii) result in any
breach of or constitute a default (or an event that with notice or lapse of time
or both would become a default) under, or impair Proxim's rights or alter the
rights or obligations of Proxim or any third party under, or give to others any
rights of termination, amendment, acceleration or cancellation of, or result in
the creation of a lien or encumbrance on any of the properties, including any
leased real property, or assets of Proxim or any of its subsidiaries pursuant
to, any Proxim Contract (as defined in Section 2.16), except as individually or
in the aggregate would not be reasonably expected to have a Material Adverse
Effect. The Proxim Disclosure Letter lists all material consents, waivers and
approvals under any of Proxim's or any of its subsidiaries' agreements,
contracts, licenses or leases required to be obtained in connection with the
consummation of the transactions contemplated hereby.
(b) 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 ("GOVERNMENTAL
ENTITY") is required by or with respect to Proxim in connection with the
execution and delivery of this Agreement or the consummation of the transactions
-8-
contemplated hereby, except for (i) the filing of the Certificate of Merger with
the Secretary of State of Delaware, (ii) the filing of the Joint Proxy Statement
(as defined in Section 2.20) with the SEC in accordance with the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), to be included in the
Form S-4 Registration Statement (the "REGISTRATION STATEMENT") to be filed by
Western Multiplex with the Securities and Exchange Commission ("SEC") in
accordance with the Securities Act of 1933, as amended (the "SECURITIES ACT"),
and the effectiveness of the Registration Statement, (iii) such consents,
approvals, orders, authorizations, registrations, declarations and filings as
may be required under applicable federal and state securities laws and the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR ACT")
and the comparable laws of any foreign country reasonably determined by the
parties to be required and (iv) such other consents, authorizations, filings,
approvals and registrations which, if not obtained or made, would not be
material to Proxim or Western Multiplex or have a material adverse effect on the
ability of the parties to consummate the Merger. The consents, approvals,
orders, authorizations, registrations, declarations and filings set forth in (i)
through (iii) are referred to herein as the "NECESSARY CONSENTS".
2.5 SEC Filings; Proxim Financial Statements.
(a) Proxim has filed all forms, reports and documents required to
be filed by Proxim with the SEC since January 1, 1999, and has made available to
Western Multiplex such forms, reports and documents in the form filed with the
SEC. All such required forms, reports and documents (including those that Proxim
may file subsequent to the date hereof) are referred to herein as the "PROXIM
SEC REPORTS." As of their respective dates, the Proxim SEC Reports (i) were
prepared in accordance with the requirements of the Securities Act or the
Exchange Act, as the case may be, and the rules and regulations of the SEC
thereunder applicable to such Proxim SEC Reports, and (ii) did not at the time
they were filed (or if amended or superseded by a filing before the date of this
Agreement, then on the date of such filing) contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. None of Proxim's
subsidiaries is required to file any forms, reports or other documents with the
SEC.
(b) Each of the consolidated financial statements (including, in
each case, any related notes thereto) contained in the Proxim SEC Reports (the
"PROXIM FINANCIALS"), including any Proxim SEC Reports filed after the date
hereof until the Closing, (i) complied as to form in all material respects with
the published rules and regulations of the SEC with respect thereto, (ii) was
prepared in accordance with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto or, in the case of unaudited interim financial
statements, as may be permitted by the SEC on Form 10-Q under the Exchange Act)
and (iii) fairly presented the consolidated financial position of Proxim and its
subsidiaries at the respective dates thereof and the consolidated results of its
operations and cash flows for the periods indicated, except that the unaudited
interim financial statements were or are subject to normal and recurring
year-end adjustments which were not, or are not expected to be, material in
amount. The balance sheet of Proxim contained in the Proxim SEC Reports as of
September 30, 2001 is hereinafter referred to as the "PROXIM BALANCE SHEET."
Except as disclosed
-9-
in the Proxim Financials, neither Proxim nor any of its subsidiaries has any
liabilities (absolute, accrued, contingent or otherwise) of a nature required to
be disclosed on a balance sheet or in the related notes to the consolidated
financial statements prepared in accordance with GAAP which are, individually or
in the aggregate, material to the business, results of operations or financial
condition of Proxim and its subsidiaries taken as a whole, except liabilities
incurred since the date of the Proxim Balance Sheet in the ordinary course of
business consistent with past practices.
(c) Proxim has heretofore furnished to Western Multiplex a
complete and correct copy of any amendments or modifications that have not yet
been filed with the SEC but that are required to be filed, to agreements,
documents or other instruments that previously had been filed by Proxim with the
SEC pursuant to the Securities Act or the Exchange Act.
2.6 Absence of Certain Changes or Events. Since the date of the Proxim
Balance Sheet, there has not been: (i) any Material Adverse Effect on Proxim,
(ii) any change by Proxim in its accounting methods, principles or practices,
except as required by concurrent changes in GAAP, or (iii) any revaluation by
Proxim of any of its assets, including, without limitation, writing down the
value of capitalized inventory or writing off notes or accounts receivable other
than in the ordinary course of business.
2.7 Taxes.
(a) Definition of Taxes. For the purposes of this Agreement,
"TAX" or "TAXES" refers to any and all federal, state, local and foreign taxes,
assessments and other governmental charges, duties, impositions and liabilities,
including taxes based upon or measured by gross receipts, income, profits,
sales, use and occupation, and value added, ad valorem, transfer, franchise,
withholding, payroll, recapture, employment, excise and property taxes, together
with all interest, penalties and additions imposed with respect to such amounts.
(b) Tax Returns and Audits.
(i) Proxim and each of its subsidiaries have timely filed all
federal, state, local and foreign returns, estimates, information statements and
reports ("RETURNS") relating to Taxes required to be filed by Proxim and each of
its subsidiaries with any Tax authority, except such Returns that are not
material to Proxim. Such Returns are true and correct in all material respects
and have been completed in accordance with applicable law. Proxim and each of
its subsidiaries have paid all Taxes shown to be due on such Returns.
(ii) Proxim and each of its subsidiaries as of the Effective
Time will have withheld with respect to its employees (and timely paid over to
the appropriate Taxing authority) all federal and state income taxes, Taxes
pursuant to the Federal Insurance Contribution Act ("FICA") and the Federal
Unemployment Tax Act ("FUTA") and other Taxes required to be withheld, except
such Taxes that are not material to Proxim.
(iii) Neither Proxim nor any of its subsidiaries has been
delinquent in the payment of any material Tax nor is there any material Tax
deficiency or adjustment outstanding,
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proposed or assessed against Proxim or any of its subsidiaries, nor has Proxim
or any of its subsidiaries executed any unexpired waiver of any statute of
limitations on or extending the period for the assessment or collection of any
material Tax.
(iv) No audit or other examination of any material Return of
Proxim or any of its subsidiaries by any Tax authority is presently in progress,
nor has Proxim or any of its subsidiaries been notified in writing of any
request for such an audit or other examination.
(v) As of September 30, 2001, neither Proxim nor any of its
subsidiaries has any liability for any material unpaid Taxes that has not been
accrued or reserved on the Proxim Balance Sheet in accordance with GAAP, whether
asserted or unasserted, contingent or otherwise. Since September 30, 2001,
neither Proxim nor any of its subsidiaries has incurred any liability for any
material Taxes other than in the ordinary course of business.
(vi) There is no contract, agreement, plan or arrangement to
which Proxim or any of its subsidiaries is a party as of the date of this
Agreement, including but not limited to the provisions of this Agreement,
covering any employee or former employee of Proxim or any of its subsidiaries
that, individually or collectively, would reasonably be expected to give rise to
the payment of any amount in excess of $250,000 that would not be deductible
pursuant to Sections 280G, 404 or 162(m) of the Code. There is no contract,
agreement, plan or arrangement to which Proxim is a party or by which it is
bound to compensate any individual for excise taxes paid pursuant to Section
4999 of the Code.
(vii) Neither Proxim nor any of its subsidiaries (a) is party
to or has any obligation under any Tax sharing, indemnity or allocation
agreement or arrangement, (b) has ever been a member of an affiliated group
(within the meaning of Code Section 1504(a)) filing a consolidated federal
income Tax Return (other than a group the common parent of which was Proxim), or
(c) has any liability for the Taxes of any person (other than Proxim or any of
its subsidiaries) under Treas. Reg. Section 1.1502-6 (or any similar provision
of state, local or foreign law), as a transferee or successor, by contract, or
otherwise.
(viii) Neither Proxim nor any of its subsidiaries has
constituted either a "distributing corporation" or a "controlled corporation" in
a distribution of stock intended to qualify for tax-free treatment under Section
355 of the Code (x) in the two years prior to the date of this Agreement or (y)
in a distribution which could otherwise constitute part of a "plan" or "series
of related transactions" (within the meaning of Section 355(e) of the Code) in
conjunction with the Merger.
2.8 Proxim Intellectual Property. For the purposes of this Agreement,
the following terms have the following definitions:
"INTELLECTUAL PROPERTY" shall mean any or all of the following and all
rights in, arising out of, or associated therewith: (i) all United States,
international and foreign patents and applications therefor and all reissues,
divisions, renewals, extensions, provisionals, continuations and
continuations-in-part thereof ("PATENTS"); (ii) all inventions (whether
patentable or not), invention
-11-
disclosures, improvements, trade secrets, proprietary information, know how,
technology, technical data and customer lists, and all documentation relating to
any of the foregoing; (iii) all copyrights, copyrights registrations and
applications therefor, and all other rights corresponding thereto throughout the
world ("COPYRIGHTS"); (iv) all industrial designs and any registrations and
applications therefor throughout the world; (v) all trade names, logos, common
law trademarks and service marks, trademark and service xxxx registrations and
applications therefor throughout the world ("TRADEMARKS"); (vi) all databases
and data collections and all rights therein throughout the world; (vii) all
moral and economic rights of authors and inventors, however denominated,
throughout the world, and (viii) any similar or equivalent rights to any of the
foregoing anywhere in the world.
"REGISTERED INTELLECTUAL PROPERTY" means all United States,
international and foreign: (i) Patents (including applications and provisional
applications); (ii) registered Trademarks, applications to register Trademarks,
intent-to-use applications, or other registrations or applications related to
Trademarks; (iii) registered Copyrights and applications for Copyright
registration; and (iv) any other Intellectual Property that is the subject of an
application, certificate, filing, registration or other document issued, filed
with, or recorded by any state, government or other public legal authority.
"PROXIM INTELLECTUAL PROPERTY" shall mean any Intellectual Property that
is owned or used by Proxim in the conduct of its business, as currently
conducted and currently proposed to be conducted.
"PROXIM REGISTERED INTELLECTUAL PROPERTY" means all of the Registered
Intellectual Property owned by, or filed in the name of, Proxim or any of its
subsidiaries.
(a) Except with respect to Proxim Registered Intellectual
Property that Proxim intentionally abandoned and/or is no longer used by or
intended to be used by Proxim which exception shall include, without limitation,
Proxim Registered Intellectual Property acquired in its acquisitions of Card
Access, Inc., Wavespan, Inc., and Farallon Communications, Inc., Schedule 2.8(a)
lists all Registered Intellectual Property owned by, filed in the name of, or
applied for, by Proxim (the "PROXIM REGISTERED INTELLECTUAL PROPERTY RIGHTS")
and lists any proceedings or actions before any court, tribunal (including the
United States Patent and Trademark Office (the "PTO") or equivalent authority
anywhere in the world) related to any of Proxim Registered Intellectual Property
Rights.
(b) During the five (5)-year period immediately prior to the date
hereof and, to the knowledge of Proxim after reasonable inquiry, during any time
prior to the five (5)-year period immediately preceding the date hereof, no
Proxim Intellectual Property or product or service that is owned by Proxim or
any of its subsidiaries is currently or was subject to any order, judgment, or
decree brought against it that restricted in any manner the use, transfer, or
licensing thereof by Proxim or any of its subsidiaries in a manner that would
reasonably be expected to have a Material Adverse Effect or that limits the
ownership, the validity, use or enforceability of any Proxim Intellectual
Property that is owned by Proxim in a manner that would reasonably be expected
to have a Material Adverse Effect.
-12-
(c) Except with respect to Proxim Registered Intellectual
Property that Proxim intentionally abandoned and/or is no longer used by or
intended to be used by Proxim which exception shall include, without limitation,
Proxim Registered Intellectual Property acquired in its acquisitions of Card
Access, Inc., Wavespan, Inc., and Farallon Communications, Inc., each material
item of Proxim Registered Intellectual Property is valid and subsisting, all
necessary registration, maintenance and renewal fees currently due in connection
with such Proxim Registered Intellectual Property have been made and all
necessary documents, recordations and certificates in connection with such
Proxim Registered Intellectual Property have been filed with the PTO or United
States Copyright Office and other equivalent authorities in foreign
jurisdictions, as the case may be, for the purposes of maintaining such Proxim
Registered Intellectual Property. Except as set forth on Schedule 2.8(c), there
are no actions that must be taken by Proxim within ninety (90) days of the
Closing Date, including the payment of any registration, maintenance or renewal
fees or the filing of any responses to PTO office actions, documents,
applications or certificates for the purposes of obtaining, maintaining,
perfecting or preserving or renewing any Registered Intellectual Property
Rights.
(d) Other than inbound "shrink-wrap" and similar publicly
available commercial binary code end-user licenses, Section 2.8(d) of the Proxim
Schedules lists all material contracts, licenses and agreements to which Proxim
and any of its subsidiaries is a party with respect to any material Proxim
Intellectual Property ("PROXIM MATERIAL IP CONTRACTS").
(e) Proxim owns and has good and exclusive title to, or has
license (sufficient for the conduct of its business as currently conducted and
as proposed to be conducted) to use each material item of Proxim Intellectual
Property, free and clear of any lien or encumbrance; provided, however, that
claims of infringement or misappropriation of Proxim Intellectual Property shall
not be deemed liens or encumbrances for the purpose of this Section 2.8(e).
(f) With respect to material Proxim Intellectual Property owned
by Proxim that has been developed or created by a third party for Proxim or any
of its subsidiaries, Proxim has a written agreement with such third party with
respect thereto, whereby Proxim has obtained ownership of all such material
Proxim Intellectual Property as between Proxim and the third party, and is the
exclusive owner of all of that third party's rights in such material Proxim
Intellectual Property.
(g) Except as set forth on Schedule 2.8(g), in the five (5) years
prior to the date hereof, neither Proxim nor any of its subsidiaries (i) has
transferred ownership of any Intellectual Property that was material Proxim
Intellectual Property to any third party, or (ii) granted any exclusive license
with respect to any Intellectual Property that is or was material Proxim
Intellectual Property owned by Proxim, to any third party.
(h) To the knowledge of Proxim after reasonable inquiry, all
Proxim Material IP Contracts are in full force and effect. Except as set forth
in Schedule 2.8(h), to the knowledge of Proxim after reasonable inquiry, the
consummation of the transactions contemplated by this Agreement will neither
violate nor result in the breach, modification, cancellation, termination or
suspension of any Proxim Material IP Contract. Proxim and each of its
subsidiaries is in
-13-
material compliance with, and has not materially breached any term of any Proxim
Material IP Contract and, to the knowledge of Proxim after reasonable inquiry,
all other parties to such Proxim Material IP Contracts are in compliance with,
and have not materially breached any term of such Proxim Material IP Contracts.
(i) Following the Closing Date, the Surviving Corporation will be
permitted to exercise all of Proxim's and each of its subsidiaries' rights under
such Proxim Material IP Contracts (a) to the same extent Proxim and its
subsidiaries would have been able to had the transactions contemplated by this
Agreement not occurred, and (b) without the payment of any additional amounts or
consideration other than the same amount of ongoing fees, royalties or payments
which Proxim or its subsidiaries would otherwise be required to pay. Except as
set forth in Schedule 2.8(i), neither this Agreement nor the transactions
contemplated by this Agreement, including the assignment to Western Multiplex or
Merger Sub by operation of law or otherwise of any Proxim Material IP Contracts
will result in (x) either Western Multiplex's or the Merger Sub's granting to
any third party any right to or with respect to any material Intellectual
Property that is owned by Proxim; or (y) either Western Multiplex's or the
Merger Sub's being bound by, or subject to, any non-compete or other material
restriction on the operation or scope of their respective businesses.
(j) To the knowledge of Proxim after reasonable inquiry, the
products, services and the operation of the business of Proxim and its
subsidiaries as such business currently is conducted, including Proxim's and its
subsidiaries' design, development, manufacture, marketing and sale of the
products or services of Proxim and its subsidiaries (including products
currently under development) has not and does not infringe, misappropriate or
otherwise violate the Intellectual Property of any third party or, to the
knowledge of Proxim after reasonable inquiry, constitute unfair competition or
trade practices under the laws of any jurisdiction.
(k) Except as set forth in Schedule 2.8(k), neither Proxim nor
any of its subsidiaries has received notice from any third party alleging that
the operation of the business of Proxim or any of its subsidiaries or any act,
product or service of Proxim or any of its subsidiaries, infringes,
misappropriates or otherwise violates the Intellectual Property of any third
party or constitutes unfair competition or trade practices under the laws of any
jurisdiction in a manner that would reasonably be expected to have a Material
Adverse Effect.
(l) Proxim and each of its subsidiaries has taken reasonable
steps to protect Proxim's and its subsidiaries' rights in all confidential
information and trade secrets of Proxim, and of third parties provided to Proxim
or any of its subsidiaries, and, without limiting the foregoing, each of Proxim
and its subsidiaries has and enforces a practice requiring each employee to
execute a proprietary information/confidentiality agreement substantially in the
form provided to Western Multiplex. All employees who worked for Proxim since
November 1, 1999 have (i) executed invention assignment agreements sufficient to
irrevocably transfer all rights in any Intellectual Property developed by such
employees to Proxim; and (ii) executed proprietary/confidential information
agreements pursuant to which they agreed to maintain as confidential all Proxim
proprietary information. Except as set forth in Schedule 2.8(l), all employees
who are listed as inventors on any Patents (including applications and
provisionals) that are Proxim Registered
-14-
Intellectual Property have signed invention assignment agreements sufficient to
irrevocably transfer all such employee's rights in any such Proxim Patents to
Proxim. Proxim has no knowledge or notice of any adverse claim of ownership of
any Proxim Intellectual Property that is owned by Proxim by any past employee of
Proxim and, to the knowledge of Proxim, there is no valid basis for any such
claim.
2.9 Compliance; Permits; Restrictions.
(a) Neither Proxim nor any of its subsidiaries nor the conduct of
their respective businesses is, in any material respect, in conflict with, or in
default or violation of, (i) any Legal Requirement applicable to Proxim or any
of its subsidiaries or by which its or any of their respective businesses or
properties is bound or affected, or (ii) any material note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which Proxim or any of its subsidiaries is a party
or by which Proxim or any of its subsidiaries or its or any of their respective
businesses or properties is bound or affected. No investigation or review by any
Governmental Entity is pending or, to the Knowledge of Proxim, threatened
against Proxim or its subsidiaries, nor has any Governmental Entity indicated to
Proxim an intention to conduct the same. There is no agreement, judgment,
injunction, order or decree binding upon Proxim or any of its subsidiaries which
has or could reasonably be expected to have the effect of prohibiting or
materially impairing any business practice of Proxim or any of its subsidiaries,
any acquisition of material property by Proxim or any of its subsidiaries or the
conduct of business by Proxim as currently conducted.
(b) Proxim and its subsidiaries hold all permits, licenses,
variances, exemptions, orders and approvals from governmental authorities that
are material to the operation of the business of Proxim (collectively, the
"PROXIM PERMITS"). Proxim and its subsidiaries are in compliance in all material
respects with the terms of the Proxim Permits.
2.10 Litigation. Except as set forth in Schedule 2.10, as of the date of
this Agreement, there is no action, suit, proceeding, claim, arbitration or
investigation ("ACTION") pending, or as to which Proxim or any of its
subsidiaries has received any notice of assertion nor, to Proxim's Knowledge, is
there a threatened Action against Proxim or any of its subsidiaries that
reasonably would be likely to be material to Proxim or any of its subsidiaries,
or which in any manner challenges or seeks to prevent, enjoin, alter or delay
any of the transactions contemplated by this Agreement. Except for those facts
and information not disclosed by Proxim or Proxim's outside counsel because
Proxim or Proxim's outside counsel reasonably believed that such facts and
information were subject to a court ordered protective order, joint defense
agreement or attorney-client privilege, to the Knowledge of Proxim, Proxim and
Proxim's attorneys provided Western Multiplex and Western Multiplex's outside
counsel with facts and information as Proxim reasonably believes in good faith
are necessary to perform a reasonable evaluation of the potential outcome of the
Actions described on Schedule 2.10. Without limiting the foregoing, the facts
and information not disclosed by Proxim by reason of any joint defense
agreement, court ordered protective order or attorney-client privilege are not
inconsistent in any material respect with the facts and information that have
been disclosed by Proxim to Western Multiplex.
-15-
2.11 Brokers' and Finders' Fees. Except for fees payable to XX Xxxxxx
H&Q ("XX Xxxxxx") and Broadview International LLC ("BROADVIEW") pursuant to
engagement letters dated December 23, 2001 and December 21, 2001, respectively,
Proxim has not incurred, nor will it incur, directly or indirectly, any
liability for brokerage or finders' fees or agents' commissions or any similar
charges in connection with this Agreement or any transaction contemplated
hereby.
2.12 Employee Benefit Plans.
(a) The employee compensation, severance, termination pay,
deferred compensation, stock or stock-related awards, incentive, fringe or
benefit plans, programs, policies, commitments or other arrangements (whether or
not set forth in a written document and including, without limitation, all
"employee benefit plans" within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) covering any
active employee, former employee, director or consultant of Proxim, any
subsidiary of Proxim or any trade or business (whether or not incorporated) that
is a member of a controlled group or that is under common control with Proxim
within the meaning of Section 414 of the Code (for purposes of Section 2.12 and
Section 3.12, an "AFFILIATE"), or with respect to which Proxim has or may in the
future have liability, are referred to herein as the "PROXIM PLANS." Proxim
Schedule 2.12(a) contains a complete and accurate list of each of the Proxim
Plans. Proxim has provided to Western Multiplex: (i) correct and complete copies
of all documents embodying each Proxim Plan including (without limitation) all
amendments thereto, all related trust documents, and all material written
agreements and contracts relating to each such Proxim Plan; (ii) the three (3)
most recent annual reports (Form Series 5500 and all schedules and financial
statements attached thereto), if any, required under ERISA or the Code in
connection with each Proxim Plan; (iii) the most recent summary plan description
together with the summary(ies) of material modifications thereto, if any,
required under ERISA with respect to each Proxim Plan; (iv) all IRS
determination, opinion, notification and advisory letters; (v) all material
correspondence to or from any governmental agency relating to any Proxim Plan;
(vi) all COBRA forms and related notices and (vii) all discrimination tests for
each Proxim Plan for the most recent three (3) plan years.
(b) Each Proxim Plan has been maintained and administered in all
material respects in compliance with its terms and with the requirements
prescribed by any and all statutes, orders, rules and regulations (foreign or
domestic), including ERISA and the Code, that are applicable to such Proxim
Plans. No suit, action or other litigation (excluding claims for benefits
incurred in the ordinary course of Proxim Plan activities) has been brought, or
to the Knowledge of Proxim is threatened, against or with respect to any such
Proxim Plan. There are no audits, inquiries or proceedings pending or, to the
Knowledge of Proxim, threatened by the Internal Revenue Service (the "IRS") or
Department of Labor (the "DOL") with respect to any Proxim Plans. All
contributions, reserves or premium payments required to be made or accrued as of
the date hereof to the Proxim Plans have been timely made or accrued. Section
2.12(b) of the Proxim Disclosure Letter includes a listing of the accrued
vacation liability of Proxim as of January 3, 2002. Any Proxim Plan intended to
be qualified under Section 401(a) of the Code and each trust intended to qualify
under Section 501(a) of the Code (i) has either obtained a favorable
determination, notification, advisory and/or opinion letter, as applicable, as
to its qualified status from the IRS or
-16-
still has a remaining period of time under applicable Treasury Regulations or
IRS pronouncements in which to apply for such letter and to make any amendments
necessary to obtain a favorable determination, and (ii) incorporates or has been
amended to incorporate all provisions required to comply with the Tax Reform Act
of 1986 and subsequent legislation. Proxim does not have any plan or commitment
to establish any new Proxim Plan, to modify any Proxim Plan (except to the
extent required by law or to conform any such Proxim Plan to the requirements of
any applicable law, in each case as previously disclosed to Western Multiplex in
writing, or as required by this Agreement), or to enter into any new Proxim
Plan. Each Proxim Plan can be amended, terminated or otherwise discontinued
after the Effective Time in accordance with its terms, without liability to
Western Multiplex, Proxim or any of its Affiliates (other than ordinary
administration expenses).
(c) Neither Proxim, any of its subsidiaries, nor any of their
Affiliates has at any time ever maintained, established, sponsored, participated
in, or contributed to any plan subject to Title IV of ERISA or Section 412 of
the Code and at no time has Proxim contributed to or been requested to
contribute to any "multiemployer plan," as such term is defined in ERISA.
Neither Proxim nor any Affiliate has at any time ever maintained, established,
sponsored, participated in or contributed to any multiple employer plan, or to
any plan described in Section 413 of the Code. Neither Proxim, any of its
subsidiaries, nor any officer or director of Proxim or any of its subsidiaries
is subject to any liability or penalty under Section 4975 through 4980B of the
Code or Title I of ERISA. No "prohibited transaction," within the meaning of
Section 4975 of the Code or Sections 406 and 407 of ERISA, and not otherwise
exempt under Section 4975 of the Code or Section 408 of ERISA, has occurred with
respect to any Proxim Plan.
(d) Neither Proxim, any of its subsidiaries, nor any of their
Affiliates has, before the Effective Time and in any material respect, violated
any of the health continuation requirements of the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended, the requirements of the Family Medical
Leave Act of 1993, as amended, or any similar provisions of state law applicable
to Proxim employees. None of the Proxim Plans promises or provides retiree
medical or other retiree welfare benefits to any person except as required by
applicable law, and neither Proxim nor any of its subsidiaries has represented,
promised or contracted (whether in oral or written form) to provide such retiree
benefits to any employee, former employee, director, consultant or other person,
except to the extent required by statute.
(e) Neither Proxim nor any of its subsidiaries is bound by or
subject to (and none of its respective assets or properties is bound by or
subject to) any arrangement with any labor union. No employee of Proxim or any
of its subsidiaries is represented by any labor union or covered by any
collective bargaining agreement and, to the Knowledge of Proxim, no campaign to
establish such representation is in progress. There is no pending or, to the
Knowledge of Proxim, threatened labor dispute involving Proxim or any of its
subsidiaries and any group of its employees nor has Proxim or any of its
subsidiaries experienced any labor interruptions over the past three (3) years,
and Proxim and its subsidiaries consider their relationships with their
employees to be good. Proxim (i) is in compliance in all respects with all
applicable foreign, federal, state and local laws, rules and regulations
respecting employment, employment practices, terms and conditions of employment
and wages and hours, in each case, with respect to its current or former
employees; (ii) has withheld and
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reported all amounts required by law or by agreement to be withheld and reported
with respect to wages, salaries and other payments to its current or former
employees; (iii) is not liable for any arrears of wages or any taxes or any
penalty for failure to comply with any of the foregoing; and (iv) is not liable
for any payment to any trust or other fund governed by or maintained by or on
behalf of any governmental authority, with respect to unemployment compensation
benefits, social security or other benefits or obligations for its current and
former employees (other than routine payments to be made in the normal course of
business and consistent with past practice). There are no pending, threatened or
reasonably anticipated claims or actions against Proxim under any worker's
compensation policy or long-term disability policy.
(f) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (either alone or upon
the occurrence of any additional or subsequent events) (i) result in any payment
(including severance, unemployment compensation, golden parachute, forgiveness
of indebtedness, bonus or otherwise) becoming due to any stockholder, director
or employee of Proxim or any of its subsidiaries under any Proxim Plan or
otherwise, (ii) materially increase any benefits otherwise payable under any
Proxim Plan, or (iii) result in the acceleration of the time of payment or
vesting of any such benefits.
(g) No payment or benefit which will or may be made by Proxim or
its Affiliates with respect to any employee or any other "disqualified
individual" (as defined in Code Section 280G and the regulations thereunder)
will be characterized as a "parachute payment," within the meaning of Code
Section 280G(B)(2).
2.13 Absence of Liens and Encumbrances. Proxim and each of its
subsidiaries has good and valid title to, or, in the case of leased properties,
including the Proxim Leases, valid leasehold interests in, all of its tangible
properties and assets, real, personal and mixed, used in its business, free and
clear of any liens or encumbrances except as reflected in the Proxim Financials
and except for liens for taxes not yet due and payable and such imperfections of
title and encumbrances, if any, which would not be material to Proxim.
2.14 Environmental Matters.
(a) Hazardous Material. Except as reasonably would not be likely
to result in a material liability to Proxim, no underground storage tanks and no
amount of any substance that has been designated by any Governmental Entity or
by applicable federal, state or local law to be radioactive, toxic, hazardous or
otherwise a danger to health or the environment, including without limitation,
PCBs, asbestos, petroleum, urea-formaldehyde and all substances listed as
hazardous substances pursuant to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, or defined as a hazardous
waste pursuant to the United States Resource Conservation and Recovery Act of
1976, as amended, and the regulations promulgated pursuant to said laws, but
excluding office and janitorial supplies (a "HAZARDOUS MATERIAL"), are present,
as a result of the actions of Proxim, or its subsidiaries or any affiliate of
Proxim, or, to the Knowledge of Proxim, as a result of any actions of any third
party or otherwise, in, on or under any property, including the land and the
improvements, ground water and surface water thereof, that Proxim or any of its
subsidiaries has at any time owned, operated, occupied or leased.
-18-
(b) Hazardous Materials Activities. Except as reasonably would
not be likely to result in a material liability to Proxim (in any individual
case or in the aggregate), (i) neither Proxim nor any of its subsidiaries has
transported, stored, used, manufactured, disposed of, released or exposed its
employees or others to Hazardous Materials in violation of any law in effect on
or before the Closing Date, and (ii) neither Proxim nor any of its subsidiaries
has disposed of, transported, sold, used, released, exposed its employees or
others to or manufactured any product containing a Hazardous Material
(collectively, "HAZARDOUS MATERIALS ACTIVITIES") in violation of any law, rule,
regulation, treaty or statute promulgated by any Governmental Entity in effect
on or prior to or as of the Closing Date to prohibit, regulate or control
Hazardous Materials or any Hazardous Material Activity or in a manner that would
be likely to result in material liability to Proxim.
(c) Permits. Except as reasonably would not be likely to result
in a material liability to Proxim, Proxim and its subsidiaries currently hold
all environmental approvals, permits, licenses, clearances and consents (the
"PROXIM ENVIRONMENTAL PERMITS") necessary for the conduct of Proxim's and its
subsidiaries' Hazardous Material Activities and other businesses of Proxim and
its subsidiaries as such activities and businesses are currently being
conducted.
(d) Environmental Liabilities. No action, proceeding, revocation
proceeding, amendment procedure, writ, injunction or claim is pending, or to
Proxim's Knowledge, threatened concerning any Proxim Environmental Permit,
Hazardous Material or any Hazardous Materials Activity of Proxim or any of its
subsidiaries.
2.15 Labor Matters. (i) There are no controversies pending or, to the
Knowledge of each of Proxim and its respective subsidiaries, threatened, between
Proxim or any of its subsidiaries and any of their respective employees or
former employees; (ii) as of the date of this Agreement, neither Proxim nor any
of its subsidiaries is a party to any collective bargaining agreement or other
labor union contract applicable to persons employed by Proxim or its
subsidiaries nor does Proxim or its subsidiaries know of any activities or
proceedings of any labor union to organize any such employees; and (iii) as of
the date of this Agreement, neither Proxim nor any of its subsidiaries has any
Knowledge of any strikes, slowdowns, work stoppages or lockouts, or threats
thereof, by or with respect to any employees of Proxim or any of its
subsidiaries.
2.16 Agreements, Contracts and Commitments. The following agreements,
contracts or commitments with respect to which Proxim or one of its subsidiaries
is a party or is bound are referred to herein as the "PROXIM CONTRACTS":
(a) any employment or consulting agreement, contract or
commitment with any officer or director or higher level employee or member of
Proxim's Board of Directors, other than those that are terminable by Proxim or
any of its subsidiaries on no more than thirty (30) days' notice without
liability or financial obligation to Proxim;
(b) any agreement or plan, including, without limitation, any
stock option plan, stock appreciation right plan or stock purchase plan, any of
the benefits of which will be increased, or the vesting of benefits of which
will be accelerated, by the occurrence of any of the transactions
-19-
contemplated by this Agreement or the value of any of the benefits of which will
be calculated on the basis of any of the transactions contemplated by this
Agreement;
(c) any agreement of indemnification or any guaranty other than
any agreement of indemnification entered into in connection with the sale or
license of software products in the ordinary course of business;
(d) any agreement, contract or commitment containing any covenant
limiting in any respect the right of Proxim or any of its subsidiaries to engage
in any line of business or to compete with any person or granting any exclusive
distribution rights;
(e) any agreement, contract or commitment currently in force
relating to the disposition or acquisition by Proxim or any of its subsidiaries
after the date of this Agreement of assets in excess of $250,000 not in the
ordinary course of business or pursuant to which Proxim has any material
ownership interest in any corporation, partnership, joint venture or other
business enterprise other than Proxim's subsidiaries;
(f) any dealer, distributor, joint marketing or development
agreement currently in force under which Proxim or any of its subsidiaries have
continuing material obligations to jointly market any product, technology or
service and which may not be canceled without penalty upon notice of ninety (90)
days or less, or any material agreement pursuant to which Proxim or any of its
subsidiaries have continuing material obligations to jointly develop any
intellectual property that will not be owned, in whole or in part, by Proxim or
any of its subsidiaries and which may not be canceled without penalty upon
notice of ninety (90) days or less;
(g) any material agreement, contract or commitment currently in
force to license any third party to manufacture or reproduce any Proxim product
or service or any material agreement, contract or commitment currently in force
to sell or distribute any Proxim products or service, including any Proxim
Material IP Contract, except agreements with distributors or sales
representative in the normal course of business cancelable without penalty upon
notice of ninety (90) days or less and substantially in the form previously
provided to Western Multiplex;
(h) any mortgages, indentures, guarantees, loans or credit
agreements, security agreements or other agreements or instruments relating to
the borrowing of money or extension of credit;
(i) any settlement agreement; provided that a Proxim Contract
shall not include any settlement agreement entered into more than five (5) years
before the date of this Agreement; or
(j) any other agreement, contract or commitment (i) in connection
with or pursuant to which Proxim and its subsidiaries will spend or receive (or
are expected to spend or receive), in the aggregate, more than $250,000 during
the current calendar year or during the next calendar year, (ii) the
termination, expiration or loss of the counterparty's performance of which could
reasonably be expected to have a Material Adverse Effect on Proxim or (iii) that
is a material contract (as defined in Item 601(b)(10) of Regulation S-K of the
SEC rules).
-20-
Neither Proxim nor any of its subsidiaries, nor to Proxim's Knowledge
any other party to a Proxim Contract, is in material breach, violation or
default under, and neither Proxim nor any of its subsidiaries has received
written notice that it has materially breached, violated or defaulted under, any
of the terms or conditions of any Proxim Contract in such a manner as would
permit any other party to cancel or terminate any such Proxim Contract, or would
permit any other party to seek material damages or other remedies (for any or
all of such breaches, violations or defaults, in the aggregate).
2.17 Title to Proxim Properties. Proxim owns no real property nor has it
ever owned any real property. All current Proxim leases, subleases or other
occupancy contracts or agreements and each amendment or other modification
thereto (the "PROXIM LEASES") are in full force and effect and are valid and
enforceable. Proxim is not in breach of or in default under any of such current
Proxim Leases and no event or condition has occurred which could (with the
giving of notice or the passage of time or both) constitute a breach of or
default by Proxim under any such current Proxim Lease. To Proxim's Knowledge, no
other party to any such current Proxim Lease is in breach of or in default under
any such current Proxim Leases and no event or condition has occurred which
could (with the giving of notice or the passage of time or both) constitute a
breach of or default by Proxim under any such current Proxim Lease. No party
other than Proxim has the right to occupy any Proxim real property currently
leased or otherwise occupied by Proxim.
2.18 Statements; Joint Proxy Statement/Prospectus. None of the
information supplied or to be supplied by Proxim for inclusion or incorporation
by reference in (i) the Registration Statement (as defined in Section 2.4(b))
will at the time it becomes effective under the Securities Act, 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 not
misleading and (ii) the joint proxy statement/prospectus to be sent to the
stockholders of Proxim and stockholders of Western Multiplex in connection with
the meeting of Proxim's stockholders to consider adoption of this Agreement (the
"PROXIM STOCKHOLDERS' MEETING") and in connection with the meeting of Western
Multiplex's stockholders to consider the approval of the Share Issuance pursuant
to the terms of the Merger (the "WESTERN MULTIPLEX STOCKHOLDERS' Meeting") (such
proxy statement/prospectus as amended or supplemented is referred to herein as
the "JOINT PROXY STATEMENT/PROSPECTUS") shall not, on the date the Joint Proxy
Statement/Prospectus is first mailed to Proxim's stockholders and Western
Multiplex's stockholders, at the time of the Proxim Stockholders' Meeting or the
Western Multiplex Stockholders' Meeting and at the Effective Time, 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 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 Proxim
Stockholders' Meeting or the Western Multiplex Stockholders' Meeting which has
become false or misleading. The Joint Proxy Statement/Prospectus will comply as
to form in all material respects with the provisions of the Exchange Act and the
rules and regulations thereunder. If at any time before the Effective Time, any
event relating to Proxim or any of its affiliates, officers or directors should
be discovered by Proxim which should be set forth in an amendment to the
Registration Statement or a supplement to the Joint Proxy Statement/Prospectus,
Proxim shall promptly inform Western Multiplex.
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Notwithstanding the foregoing, Proxim makes no representation or warranty with
respect to any information supplied by Western Multiplex or Merger Sub that is
contained in any of the foregoing documents.
2.19 Board Approval. The Board of Directors of Proxim (i) has determined
that the Merger is advisable, consistent with and in furtherance of the
long-term business strategy of Proxim and fair to, and in the best interests of,
Proxim and its stockholders, (ii) has approved this Agreement, the Merger and
the other transactions contemplated by this Agreement and deemed this Agreement
advisable and (iii) has determined to recommend adoption of this Agreement by
the stockholders of Proxim (collectively, the "PROXIM BOARD RECOMMENDATION").
2.20 Opinion of Financial Advisors. The Board of Directors of Proxim has
received an opinion from each of XX Xxxxxx and Broadview, dated the date of this
Agreement, to the effect that, as of such date, the Exchange Ratio is fair, from
a financial point of view, to Proxim's stockholders, a signed copy of which
opinions will be delivered to Western Multiplex solely for informational
purposes as promptly as practicable after receipt thereof by Proxim.
2.21 Vote Required. The affirmative vote of a majority of the votes that
holders of the outstanding shares of Proxim Common Stock are entitled to vote
with respect to the Merger is the only vote of the holders of any class or
series of Proxim's capital stock necessary to adopt this Agreement and approve
the transactions contemplated hereby.
2.22 State Takeover Statutes. The Board of Directors of Proxim has
approved this Agreement and the Proxim Voting Agreements and the Merger and the
other transactions contemplated hereby and thereby, and such approval is
sufficient to render inapplicable to the Merger, and the other transactions
contemplated hereby and thereby the restrictions contained in Section 203 of the
Delaware Law to the extent, if any, such restrictions would otherwise be
applicable to the Merger, this Agreement and the Proxim Voting Agreements and
the other transactions contemplated by this Agreement and the Proxim Voting
Agreements. No other state takeover statute or similar statute or regulation
applies to or purports to apply to the Merger, this Agreement, the Proxim Voting
Agreements or the transactions contemplated hereby and thereby.
2.23 Proxim Rights Agreement. The Proxim Board has amended (in the form
provided to Western Multiplex) the Preferred Shares Rights Agreement entered
into as of March 31, 1997 (and amended and restated as of July 9, 1997) between
Proxim and the First National Bank of Boston (the "PROXIM RIGHTS AGREEMENT") so
that none of Western Multiplex, Merger Sub or any of their respective affiliates
shall become an "Acquiring Person," and no "Distribution Date" or "Triggering
Event" (as such terms are defined in the Proxim Rights Agreement) will occur as
a result of the approval, execution or delivery of this Agreement or the Proxim
Voting Agreements or the consummation of the transactions contemplated hereby
and thereby. The Proxim Rights Agreement and the outstanding rights thereunder
(the "PROXIM RIGHTS") shall terminate and be of no further force or effect as of
immediately prior to the Effective Time, without any consideration being payable
with respect to the outstanding Proxim Rights thereunder.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF WESTERN MULTIPLEX AND MERGER SUB
Western Multiplex and Merger Sub represent and warrant to Proxim,
subject to the exceptions specifically disclosed in the disclosure letter
supplied by Western Multiplex to Proxim (the "WESTERN MULTIPLEX DISCLOSURE
LETTER") and specific statements of historical fact disclosed in the Western
Multiplex SEC Reports (to the extent the relevance of the disclosure in the
Western Multiplex SEC Report to a representation and warranty is reasonably
apparent), as follows:
3.1 Organization of Western Multiplex.
(a) Western Multiplex and each of its subsidiaries is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation; has the corporate power and authority
to own, lease and operate its assets and property and to carry on its business
as now being conducted and as proposed to be conducted; and is duly qualified to
do business and in good standing as a foreign corporation in each jurisdiction
in which the failure to be so qualified, individually or in the aggregate, would
have a Material Adverse Effect (as defined in Section 8.3) on Western
Multiplex.
(b) Western Multiplex has delivered to Proxim a true and
complete list of all of Western Multiplex's subsidiaries, indicating the
jurisdiction of incorporation of each subsidiary and Western Multiplex's equity
interest therein.
(c) Western Multiplex has delivered or made available to Proxim
a true and correct copy of the Certificate of Incorporation and bylaws of
Western Multiplex and similar governing instruments of each of its material
subsidiaries, each as amended to date, and each such instrument is in full force
and effect. Neither Western Multiplex nor any of its subsidiaries is in
violation of any of the provisions of its Certificate of Incorporation or bylaws
or equivalent governing instruments.
3.2 Western Multiplex Capital Structure. As of January 15, 2002, the
authorized capital stock of Western Multiplex consisted of (A) 200,000,000
shares of Western Multiplex Common Stock, of which (x) 58,930,747 shares were
issued and outstanding and (y) 42,000,000 shares were held in treasury; (B)
100,000,000 shares of Western Multiplex Class B Common Stock, par value $0.01
per share, of which no shares were issued and outstanding; and (C) 25,000,000
shares of preferred stock, par value $0.01 per share, of which no shares were
issued and outstanding. The authorized capital stock of Merger Sub consists of
1,000 shares of Common Stock, par value $0.01 per share, all of which, as of the
date hereof, are issued and outstanding and are held by Western Multiplex. All
outstanding shares of Western Multiplex Common Stock are duly authorized,
validly issued, fully paid and nonassessable and are not subject to preemptive
rights created by statute, the Certificate of Incorporation or Bylaws of Western
Multiplex or any agreement or document to which Western Multiplex is a party or
by which it is bound. As of January 11, 2002, Western Multiplex had reserved an
aggregate of 13,822,587 shares of Western Multiplex Common Stock, net of
exercises, for issuance to employees, consultants and non-employee directors
pursuant to Western
-23-
Multiplex's 1999 Stock Incentive Plan, 2000 Stock Option Plan for Non-Employee
Directors, Ubiquity Communication equity incentive plans and the WirelessHome
Platinum IP Stock Incentive Plan (the "WESTERN MULTIPLEX STOCK OPTION PLANS"),
under which options are outstanding for 10,307,075 shares and under which
3,515,510 shares are available for grant as of January 11, 2002. All shares of
Western Multiplex Common Stock subject to issuance as aforesaid, upon issuance
on the terms and conditions specified in the instruments pursuant to which they
are issuable, would be duly authorized, validly issued, fully paid and
nonassessable.
3.3 Obligations With Respect to Capital Stock. As of the date hereof,
except as set forth in Section 3.2, there are no equity securities, partnership
interests or similar ownership interests of any class of Western Multiplex, or
any securities exchangeable or convertible into or exercisable for such equity
securities, partnership interests or similar ownership interests issued,
reserved for issuance or outstanding. As of the date hereof, except for
securities Western Multiplex owns, directly or indirectly through one or more
subsidiaries, there are no equity securities, partnership interests or similar
ownership interests of any class of any subsidiary of Western Multiplex, or any
security exchangeable or convertible into or exercisable for such equity
securities, partnership interests or similar ownership interests issued,
reserved for issuance or outstanding. As of the date hereof, except as set forth
in Section 3.2, there are no options, warrants, equity securities, partnership
interests or similar ownership interests, calls, rights (including preemptive
rights), commitments or agreements of any character to which Western Multiplex
or any of its subsidiaries is a party or by which it is bound obligating Western
Multiplex or any of its subsidiaries to issue, deliver or sell, or cause to be
issued, delivered or sold, or repurchase, redeem or otherwise acquire, or cause
the repurchase, redemption or acquisition, of any shares of capital stock of
Western Multiplex or any of its subsidiaries or obligating Western Multiplex or
any of its subsidiaries to grant, extend, accelerate the vesting of or enter
into any such option, warrant, equity security, partnership interest or similar
ownership interest, call, right, commitment or agreement. There are no
registration rights and, to the Knowledge of Western Multiplex there are no
voting trusts, proxies or other agreements or understandings with respect to any
equity security of any class of Western Multiplex or with respect to any equity
security, partnership interest or similar ownership interest of any class of any
of its subsidiaries.
3.4 Authority.
(a) Western Multiplex has all requisite corporate power and
authority to enter into 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 Western Multiplex, subject only
to the approval of the Share Issuance by Western Multiplex's stockholders and
the filing and recordation of the Certificate of Merger pursuant to Delaware
Law. This Agreement has been duly executed and delivered by Western Multiplex
and, assuming the due authorization, execution and delivery by Proxim and Merger
Sub, constitutes the valid and binding obligation of Western Multiplex,
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy and other similar laws and general principles of equity.
The execution and delivery of this Agreement by Western Multiplex does not, and
the performance of this Agreement by Western
-24-
Multiplex will not, (i) conflict with or violate the Certificate of
Incorporation or bylaws of Western Multiplex or the equivalent organizational
documents of any of its subsidiaries, (ii) subject to obtaining the approval of
the Share Issuance by Western Multiplex's stockholders as contemplated in
Section 5.2 (the "WESTERN MULTIPLEX STOCKHOLDER APPROVAL") and compliance with
the requirements set forth in Section 3.4(b) below, conflict with or violate any
Legal Requirement applicable to Western Multiplex or any of its subsidiaries or
by which its or any of their respective properties is bound or affected, or
(iii) result in any breach of or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or impair Western
Multiplex's rights or alter the rights or obligations of Western Multiplex or
any third party under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties, including any leased real property, or
assets of Western Multiplex or any of its subsidiaries pursuant to, any Western
Multiplex Contract (as defined in Section 3.16), except as individually or in
the aggregate would not be reasonably expected to have a Material Adverse
Effect. The Western Multiplex Disclosure Letter list all material consents,
waivers and approvals under any of Western Multiplex's or any of its
subsidiaries' agreements, contracts, licenses or leases required to be obtained
in connection with the consummation of the transactions contemplated hereby.
(b) No consent, approval, order or authorization of, or
registration, declaration or filing with any Governmental Entity is required by
or with respect to Western Multiplex in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby, except for (i) the Necessary Consents and (ii) such other consents,
authorizations, filings, approvals and registrations which, if not obtained or
made, would not be material to Western Multiplex or Proxim or have a material
adverse effect on the ability of the parties to consummate the Merger.
3.5 SEC Filings; Western Multiplex Financial Statements.
(a) Western Multiplex has filed all forms, reports and documents
required to be filed by Western Multiplex with the SEC since August 4, 2000, and
has made available to Proxim such forms, reports and documents in the form filed
with the SEC. All such required forms, reports and documents (including those
that Western Multiplex may file subsequent to the date hereof) are referred to
herein as the "WESTERN MULTIPLEX SEC REPORTS." As of their respective dates, the
Western Multiplex SEC Reports (i) were prepared in accordance with the
requirements of the Securities Act or the Exchange Act, as the case may be, and
the rules and regulations of the SEC thereunder applicable to such Western
Multiplex SEC Reports, and (ii) did not at the time they were filed (or if
amended or superseded by a filing before the date of this Agreement, then on the
date of such filing) contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. None of Western Multiplex's subsidiaries is required
to file any forms, reports or other documents with the SEC.
(b) Each of the consolidated financial statements (including, in
each case, any related notes thereto) contained in the Western Multiplex SEC
Reports (the "WESTERN MULTIPLEX
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FINANCIALS"), including any Western Multiplex SEC Reports filed after the date
hereof until the Closing, (i) complied as to form in all material respects with
the published rules and regulations of the SEC with respect thereto, (ii) was
prepared in accordance with GAAP applied on a consistent basis throughout the
periods involved (except as may be indicated in the notes thereto or, in the
case of unaudited interim financial statements, as may be permitted by the SEC
on Form 10-Q under the Exchange Act) and (iii) fairly presented the consolidated
financial position of Western Multiplex and its subsidiaries at the respective
dates thereof and the consolidated results of its operations and cash flows for
the periods indicated, except that the unaudited interim financial statements
were or are subject to normal and recurring year-end adjustments which were not,
or are not expected to be, material in amount. The balance sheet of Western
Multiplex contained in the Western Multiplex SEC Reports as of September 28,
2001 is hereinafter referred to as the "WESTERN MULTIPLEX BALANCE SHEET." Except
as disclosed in the Western Multiplex Financials, neither Western Multiplex nor
any of its subsidiaries has any liabilities (absolute, accrued, contingent or
otherwise) of a nature required to be disclosed on a balance sheet or in the
related notes to the consolidated financial statements prepared in accordance
with GAAP which are, individually or in the aggregate, material to the business,
results of operations or financial condition of Western Multiplex and its
subsidiaries taken as a whole, except liabilities incurred since the date of the
Western Multiplex Balance Sheet in the ordinary course of business consistent
with past practices.
(c) Western Multiplex has heretofore furnished to Proxim a
complete and correct copy of any amendments or modifications that have not yet
been filed with the SEC but that are required to be filed, to agreements,
documents or other instruments that previously had been filed by Western
Multiplex with the SEC pursuant to the Securities Act or the Exchange Act.
3.6 Absence of Certain Changes or Events. Since the date of the Western
Multiplex Balance Sheet, there has not been: (i) any Material Adverse Effect on
Western Multiplex, (ii) any change by Western Multiplex in its accounting
methods, principles or practices, except as required by concurrent changes in
GAAP, or (iii) any revaluation by Western Multiplex of any of its assets,
including, without limitation, writing down the value of capitalized inventory
or writing off notes or accounts receivable other than in the ordinary course of
business.
3.7 Taxes.
(a) Western Multiplex and each of its subsidiaries have timely
filed all Returns relating to Taxes required to be filed by Western Multiplex
and each of its subsidiaries with any Tax authority, except such Returns that
are not material to Western Multiplex. Such Returns are true and correct in all
material respects and have been completed in accordance with applicable law.
Western Multiplex and each of its subsidiaries have paid all Taxes shown to be
due on such Returns.
(b) Western Multiplex and each of its subsidiaries as of the
Effective Time will have withheld with respect to its employees (and timely paid
over to the appropriate Taxing authority) all federal and state income taxes,
Taxes pursuant to the FICA and FUTA, and other Taxes required to be withheld,
except such Taxes that are not material to Western Multiplex.
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(c) Neither Western Multiplex nor any of its subsidiaries has
been delinquent in the payment of any material Tax nor is there any material Tax
deficiency or adjustment outstanding, proposed or assessed against Western
Multiplex or any of its subsidiaries, nor has Western Multiplex or any of its
subsidiaries executed any unexpired waiver of any statute of limitations on or
extending the period for the assessment or collection of any material Tax.
(d) No audit or other examination of any material Return of
Western Multiplex or any of its subsidiaries by any Tax authority is presently
in progress, nor has Western Multiplex or any of its subsidiaries been notified
in writing of any request for such an audit or other examination.
(e) As of September 28, 2001, neither Western Multiplex nor any
of its subsidiaries has any liability for any material unpaid Taxes that has not
been accrued for or reserved on the Western Multiplex Balance Sheet in
accordance with GAAP, whether asserted or unasserted, contingent or otherwise.
Since September 28, 2001, neither Western Multiplex nor any of its subsidiaries
has incurred any liability for any material Taxes other than in the ordinary
course of business.
(f) There is no contract, agreement, plan or arrangement to
which Western Multiplex or any of its subsidiaries is a party as of the date of
this Agreement, including but not limited to the provisions of this Agreement,
covering any employee or former employee of Western Multiplex or any of its
subsidiaries that, individually or collectively, would reasonably be expected to
give rise to the payment of any amount in excess of $250,000 that would not be
deductible pursuant to Sections 280G, 404 or 162(m) of the Code. There is no
contract, agreement, plan or arrangement to which Western Multiplex is a party
or by which it is bound to compensate any individual for excise taxes paid
pursuant to Section 4999 of the Code.
(g) Neither Western Multiplex nor any of its subsidiaries (a) is
party to or has any obligation under any Tax sharing, indemnity or allocation
agreement or arrangement (b) has ever been a member of an affiliated group
(within the meaning of Code Section 1504(a)) filing a consolidated federal
income Tax Return (other than a group the common parent of which was Western
Multiplex) or (c) has any liability for the Taxes of any person (other than
Western Multiplex or any of its subsidiaries) under Treas. Reg. Section 1.1502-6
(or any similar provision of state, local or foreign law), as a transferee or
successor, by contract, or otherwise.
(h) Neither Western Multiplex nor any of its subsidiaries has
constituted either a "distributing corporation" or a "controlled corporation" in
a distribution of stock intended to qualify for tax-free treatment under Section
355 of the Code (x) in the two years prior to the date of this Agreement or (y)
in a distribution which could otherwise constitute part of a "plan" or "series
of related transactions" (within the meaning of Section 355(e) of the Code) in
conjunction with the Merger.
3.8 Western Multiplex Intellectual Property. For the purposes of this
Agreement, the following terms have the following definitions:
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"WESTERN MULTIPLEX INTELLECTUAL PROPERTY" shall mean any Intellectual
Property that is owned or used by Western Multiplex in the conduct of its
business, as currently conducted and currently proposed to be conducted.
"WESTERN MULTIPLEX REGISTERED INTELLECTUAL PROPERTY" means all of the
Registered Intellectual Property owned by, or filed in the name of, Western
Multiplex or any of its subsidiaries.
(a) Except with respect to Western Multiplex Registered
Intellectual Property that Western Multiplex intentionally abandoned and/or is
no longer used by or intended to be used by Western Multiplex which exception
shall include, without limitation, Western Multiplex Registered Intellectual
Property acquired in its acquisitions of Ubiquity Communications, Schedule
3.8(a) lists all Registered Intellectual Property owned by, filed in the name
of, or applied for, by Western Multiplex (the "WESTERN MULTIPLEX REGISTERED
INTELLECTUAL PROPERTY RIGHTS") and lists any proceedings or actions before any
court, tribunal (including the United States Patent and Trademark Office or
equivalent authority anywhere in the world) related to any of Western Multiplex
Registered Intellectual Property Rights.
(b) During the five (5)-year period immediately prior to the
date hereof and, to the knowledge of Western Multiplex after reasonable inquiry,
during any time prior to the five (5)-year period immediately preceding the date
hereof, no Western Multiplex Intellectual Property or product or service that is
owned by Western Multiplex or any of its subsidiaries is currently or was
subject to any order, judgment, or decree brought against it that restricted in
any manner the use, transfer, or licensing thereof by Western Multiplex or any
of its subsidiaries in a manner that would reasonably be expected to have a
Material Adverse Effect or that limits the ownership, the validity, use or
enforceability of any Western Multiplex Intellectual Property that is owned by
Western Multiplex in a manner that would reasonably be expected to have a
Material Adverse Effect.
(c) Except with respect to Western Multiplex Registered
Intellectual Property that Western Multiplex intentionally abandoned and/or is
no longer used by or intended to be used by Western Multiplex which exception
shall include, without limitation, Western Multiplex Registered Intellectual
Property acquired in its acquisitions of Ubiquity Communications, each material
item of Western Multiplex Registered Intellectual Property is valid and
subsisting and, except as set forth in Schedule 3.8(c), all necessary
registration, maintenance and renewal fees currently due in connection with such
Western Multiplex Registered Intellectual Property have been made and all
necessary documents, recordations and certificates in connection with such
Western Multiplex Registered Intellectual Property have been filed with the PTO
or United States Copyright Office and other equivalent authorities in foreign
jurisdictions, as the case may be, for the purposes of maintaining such Western
Multiplex Registered Intellectual Property. There are no actions that must be
taken by Western Multiplex within ninety (90) days of the Closing Date,
including the payment of any registration, maintenance or renewal fees or the
filing of any responses to PTO office actions, documents, applications or
certificates for the purposes of obtaining, maintaining, perfecting or
preserving or renewing any Registered Intellectual Property Rights.
(d) Other than inbound "shrink-wrap" and similar publicly
available commercial binary code end-user licenses, Section 3.8(d) of the
Western Multiplex Schedules lists all material
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contracts, licenses and agreements to which Western Multiplex and any of its
subsidiaries is a party with respect to any material Western Multiplex
Intellectual Property ("WESTERN MULTIPLEX MATERIAL IP CONTRACTS").
(e) Western Multiplex owns and has good and exclusive title to,
or has license (sufficient for the conduct of its business as currently
conducted and as proposed to be conducted) to use each material item of Western
Multiplex Intellectual Property, free and clear of any lien or encumbrance;
provided, however, that claims of infringement or misappropriation of Western
Multiplex Intellectual Property shall not be deemed liens or encumbrances for
the purpose of this Section 3.8(e).
(f) With respect to material Western Multiplex Intellectual
Property owned by Western Multiplex that has been developed or created by a
third party for Western Multiplex or any of its subsidiaries, Western Multiplex
has a written agreement with such third party with respect thereto, whereby
Western Multiplex has obtained ownership of all such material Western Multiplex
Intellectual Property as between Western Multiplex and the third party, and is
the exclusive owner of all of that third party's rights in such material Western
Multiplex Intellectual Property.
(g) In the five (5) years prior to the date hereof, neither
Western Multiplex nor any of its subsidiaries (i) has transferred ownership of
any Intellectual Property that was material Western Multiplex Intellectual
Property to any third party, or (ii) granted any exclusive license with respect
to any Intellectual Property that is or was material Western Multiplex
Intellectual Property owned by Western Multiplex, to any third party.
(h) To the knowledge of Western Multiplex after reasonable
inquiry, all Western Multiplex Material IP Contracts are in full force and
effect. Except as set forth in Schedule 3.8(h), to the knowledge of Western
Multiplex after reasonable inquiry, the consummation of the transactions
contemplated by this Agreement will neither violate nor result in the breach,
modification, cancellation, termination or suspension of any Western Multiplex
Material IP Contract. Western Multiplex and each of its subsidiaries is in
material compliance with, and has not materially breached any term of any
Western Multiplex Material IP Contract and, to the knowledge of Western
Multiplex after reasonable inquiry, all other parties to such Western Multiplex
Material IP Contracts are in compliance with, and have not materially breached
any term of such Western Multiplex Material IP Contracts.
(i) Following the Closing Date, the Surviving Corporation will
be permitted to exercise all of Western Multiplex's and each of its
subsidiaries' rights under such Western Multiplex Material IP Contracts (a) to
the same extent Western Multiplex and its subsidiaries would have been able to
had the transactions contemplated by this Agreement not occurred, and (b)
without the payment of any additional amounts or consideration other than the
same amount of ongoing fees, royalties or payments which Western Multiplex or
its subsidiaries would otherwise be required to pay.
(j) To the knowledge of Western Multiplex after reasonable
inquiry, the products, services and the operation of the business of Western
Multiplex and its subsidiaries as such business
-29-
currently is conducted, including Western Multiplex's and its subsidiaries'
design, development, manufacture, marketing and sale of the products or services
of Western Multiplex and its subsidiaries (including products currently under
development) has not and does not infringe, misappropriate or otherwise violate
the Intellectual Property of any third party or, to the knowledge of Western
Multiplex after reasonable inquiry, constitute unfair competition or trade
practices under the laws of any jurisdiction.
(k) Neither Western Multiplex nor any of its subsidiaries has
received notice from any third party alleging that the operation of the business
of Western Multiplex or any of its subsidiaries or any act, product or service
of Western Multiplex or any of its subsidiaries, infringes, misappropriates or
otherwise violates the Intellectual Property of any third party or constitutes
unfair competition or trade practices under the laws of any jurisdiction in a
manner that would reasonably be expected to have a Material Adverse Effect.
(l) Western Multiplex and each of its subsidiaries has taken
reasonable steps to protect Western Multiplex's and its subsidiaries' rights in
all confidential information and trade secrets of Western Multiplex, and of
third parties provided to Western Multiplex or any of its subsidiaries, and,
without limiting the foregoing, each of Western Multiplex and its subsidiaries
has and enforces a practice requiring each employee to execute a proprietary
information/confidentiality agreement substantially in the form provided to
Proxim. All employees who worked for Western Multiplex since November 1, 1999
have (i) executed invention assignment agreements sufficient to irrevocably
transfer all rights in any Intellectual Property developed by such employees to
Western Multiplex; and (ii) executed proprietary/confidential information
agreements pursuant to which they agreed to maintain as confidential all Western
Multiplex proprietary information. Except as set forth in Schedule 3.8(l), all
employees who are listed as inventors on any Patents (including applications and
provisionals) that are Western Multiplex Registered Intellectual Property have
signed invention assignment agreements sufficient to irrevocably transfer all
such employee's rights in any such Western Multiplex Patents to Western
Multiplex. Western Multiplex has no knowledge or notice of any adverse claim of
ownership of any Western Multiplex Intellectual Property that is owned by
Western Multiplex by any past employee of Western Multiplex and, to the
knowledge of Western Multiplex, there is no valid basis for any such claim.
(m) After the Western Multiplex Spin-Out, Western Multiplex
owned or had a right to use all Intellectual Property that, at the time of the
Western Multiplex Spin-Out, was used in and/or necessary to the conduct of the
business of Western Multiplex as it was conducted at the time of the Western
Multiplex Spin-Out and, to the Knowledge of Western Multiplex, at the time of
the Western Multiplex Spin-Out, was material to the business of Western
Multiplex as it was planned or contemplated to be conducted. For the purpose of
this Section 3.8(m), "WESTERN MULTIPLEX SPIN-OUT" means the spin-out of Western
Multiplex from Glenayre Corporation pursuant to the Acquisition Agreement by and
among GTI Acquisition Corp., Glenayre Technologies, Inc., Western Multiplex, a
California Corporation and Western Multiplex, a Delaware Corporation.
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3.9 Compliance; Permits; Restrictions.
(a) Neither Western Multiplex nor any of its subsidiaries nor
the conduct of their respective businesses is, in any material respect, in
conflict with, or in default or violation of, (i) any Legal Requirement
applicable to Western Multiplex or any of its subsidiaries or by which its or
any of their respective businesses or properties is bound or affected, or (ii)
any material note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which Western
Multiplex or any of its subsidiaries is a party or by which Western Multiplex or
any of its subsidiaries or its or any of their respective businesses or
properties is bound or affected. No investigation or review by any Governmental
Entity is pending or, to the Knowledge of Western Multiplex, threatened against
Western Multiplex or its subsidiaries, nor has any Governmental Entity indicated
to Western Multiplex an intention to conduct the same. There is no material
agreement, judgment, injunction, order or decree binding upon Western Multiplex
or any of its subsidiaries which has or could reasonably be expected to have the
effect of prohibiting or materially impairing any business practice of Western
Multiplex or any of its subsidiaries, any acquisition of material property by
Western Multiplex or any of its subsidiaries or the conduct of business by
Western Multiplex as currently conducted.
(b) Western Multiplex and its subsidiaries hold all permits,
licenses, variances, exemptions, orders and approvals from governmental
authorities that are material to the operation of the business of Western
Multiplex (collectively, the "WESTERN MULTIPLEX PERMITS"). Western Multiplex and
its subsidiaries are in compliance in all material respects with the terms of
the Western Multiplex Permits.
3.10 Litigation. Except as set forth in Schedule 3.10, as of the date of
this Agreement, there is no Action pending, or as to which Western Multiplex
or any of its subsidiaries has received any notice of assertion nor,to Western
Multiplex's Knowledge, is there a threatened Action against Western
Multiplex or any of its subsidiaries that reasonably would be likely to be
material to Western Multiplex or any of its subsidiaries, or which in any
manner challenges or seeks to prevent, enjoin, alter or delay any of the
transactions contemplated by this Agreement.
3.11 Brokers' and Finders' Fees. Except for fees payable to Credit
Suisse First Boston pursuant to an engagement letter dated December 18, 2001,
Western Multiplex has not incurred, nor will it incur, directly or indirectly,
any liability for brokerage or finders' fees or agents' commissions or any
similar charges in connection with this Agreement or any transaction
contemplated hereby.
3.12 Employee Benefit Plans.
(a) The employee compensation, severance, termination pay,
deferred compensation, stock or stock-related awards, incentive, fringe or
benefit plans, programs, policies, commitments or other arrangements (whether or
not set forth in a written document and including, without limitation, all
"employee benefit plans" within the meaning of Section 3(3) of ERISA) covering
any active employee, former employee, director or consultant of Western
Multiplex, any subsidiary of Western Multiplex or any trade or business (whether
or not incorporated) that is an
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Affiliate, or with respect to which Western Multiplex has or may in the future
have liability, are referred to herein as the "WESTERN MULTIPLEX PLANS." Western
Multiplex Schedule 3.12(a) contains a complete and accurate list of each of the
Western Multiplex Plans. Western Multiplex has provided to Proxim: (i) correct
and complete copies of all documents embodying each Western Multiplex Plan
including (without limitation) all amendments thereto, all related trust
documents, and all material written agreements and contracts relating to each
such Western Multiplex Plan; (ii) the three (3) most recent annual reports (Form
Series 5500 and all schedules and financial statements attached thereto), if
any, required under ERISA or the Code in connection with each Western Multiplex
Plan; (iii) the most recent summary plan description together with the
summary(ies) of material modifications thereto, if any, required under ERISA
with respect to each Western Multiplex Plan; (iv) all IRS determination,
opinion, notification and advisory letters; (v) all material correspondence to
or from any governmental agency relating to any Western Multiplex Plan; (vi) all
COBRA forms and related notices and (vii) all discrimination tests for each
Western Multiplex Plan for the most recent three (3) plan years.
(b) Each Western Multiplex Plan has been maintained and
administered in all material respects in compliance with its terms and with the
requirements prescribed by any and all statutes, orders, rules and regulations
(foreign or domestic), including ERISA and the Code, that are applicable to such
Western Multiplex Plans. No suit, action or other litigation (excluding claims
for benefits incurred in the ordinary course of Western Multiplex Plan
activities) has been brought, or to the Knowledge of Western Multiplex is
threatened, against or with respect to any such Western Multiplex Plan. There
are no audits, inquiries or proceedings pending or, to the Knowledge of Western
Multiplex, threatened by the IRS or the DOL with respect to any Western
Multiplex Plans. All contributions, reserves or premium payments required to be
made or accrued as of the date hereof to the Western Multiplex Plans have been
timely made or accrued. Section 3.12(b) of the Western Multiplex Disclosure
Letter includes a listing of the accrued vacation liability of Western Multiplex
as of September 28, 2001. Any Western Multiplex Plan intended to be qualified
under Section 401(a) of the Code and each trust intended to qualify under
Section 501(a) of the Code (i) has either obtained a favorable determination,
notification, advisory and/or opinion letter, as applicable, as to its qualified
status from the IRS or still has a remaining period of time under applicable
Treasury Regulations or IRS pronouncements in which to apply for such letter and
to make any amendments necessary to obtain a favorable determination, and (ii)
incorporates or has been amended to incorporate all provisions required to
comply with the Tax Reform Act of 1986 and subsequent legislation. Western
Multiplex does not have any plan or commitment to establish any new Western
Multiplex Plan, to modify any Western Multiplex Plan (except to the extent
required by law or to conform any such Western Multiplex Plan to the
requirements of any applicable law, in each case as previously disclosed to
Proxim in writing, or as required by this Agreement), or to enter into any new
Western Multiplex Plan. Each Western Multiplex Plan can be amended, terminated
or otherwise discontinued after the Effective Time in accordance with its terms,
without liability to Proxim, Western Multiplex or any of its Affiliates (other
than ordinary administration expenses).
(c) Neither Western Multiplex, any of its subsidiaries, nor any
of their Affiliates has at any time ever maintained, established, sponsored,
participated in, or contributed to any plan subject to Title IV of ERISA or
Section 412 of the Code and at no time has Western Multiplex
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contributed to or been requested to contribute to any "multiemployer plan," as
such term is defined in ERISA. Neither Western Multiplex nor any Affiliate has
at any time ever maintained, established, sponsored, participated in or
contributed to any multiple employer plan, or to any plan described in Section
413 of the Code. Neither Western Multiplex, any of its subsidiaries, nor any
officer or director of Western Multiplex or any of its subsidiaries is subject
to any liability or penalty under Section 4975 through 4980B of the Code or
Title I of ERISA. No "prohibited transaction," within the meaning of Section
4975 of the Code or Sections 406 and 407 of ERISA, and not otherwise exempt
under Section 4975 of the Code or Section 408 of ERISA, has occurred with
respect to any Western Multiplex Plan.
(d) Neither Western Multiplex, any of its subsidiaries, nor any
of their Affiliates has, before the Effective Time and in any material respect,
violated any of the health continuation requirements of the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended, the requirements of the Family
Medical Leave Act of 1993, as amended, or any similar provisions of state law
applicable to Western Multiplex employees. None of the Western Multiplex Plans
promises or provides retiree medical or other retiree welfare benefits to any
person except as required by applicable law, and neither Western Multiplex nor
any of its subsidiaries has represented, promised or contracted (whether in oral
or written form) to provide such retiree benefits to any employee, former
employee, director, consultant or other person, except to the extent required by
statute.
(e) Neither Western Multiplex nor any of its subsidiaries is
bound by or subject to (and none of its respective assets or properties is bound
by or subject to) any arrangement with any labor union. No employee of Western
Multiplex or any of its subsidiaries is represented by any labor union or
covered by any collective bargaining agreement and, to the Knowledge of Western
Multiplex, no campaign to establish such representation is in progress. There is
no pending or, to the Knowledge of Western Multiplex, threatened labor dispute
involving Western Multiplex or any of its subsidiaries and any group of its
employees nor has Western Multiplex or any of its subsidiaries experienced any
labor interruptions over the past three (3) years, and Western Multiplex and its
subsidiaries consider their relationships with their employees to be good.
Western Multiplex (i) is in compliance in all material respects with all
applicable material foreign, federal, state and local laws, rules and
regulations respecting employment, employment practices, terms and conditions of
employment and wages and hours, in each case, with respect to its current or
former employees; (ii) has withheld and reported all amounts required by law or
by agreement to be withheld and reported with respect to wages, salaries and
other payments to its current or former employees; (iii) is not liable for any
arrears of wages or any taxes or any penalty for failure to comply with any of
the foregoing; and (iv) is not liable for any payment to any trust or other fund
governed by or maintained by or on behalf of any governmental authority, with
respect to unemployment compensation benefits, social security or other benefits
or obligations for its current and former employees (other than routine payments
to be made in the normal course of business and consistent with past practice).
There are no pending, threatened or reasonably anticipated claims or actions
against Western Multiplex under any worker's compensation policy or long-term
disability policy.
-33-
(f) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (either alone or upon
the occurrence of any additional or subsequent events) (i) result in any payment
(including severance, unemployment compensation, golden parachute, forgiveness
of indebtedness, bonus or otherwise) becoming due to any stockholder, director
or employee of Western Multiplex or any of its subsidiaries under any Western
Multiplex Plan or otherwise, (ii) materially increase any benefits otherwise
payable under any Western Multiplex Plan, or (iii) result in the acceleration of
the time of payment or vesting of any such benefits.
(g) No payment or benefit which will or may be made by Western
Multiplex or its Affiliates with respect to any employee or any other
"disqualified individual" (as defined in Code Section 280G and the regulations
thereunder) will be characterized as a "parachute payment," within the meaning
of Code Section 280G(B)(2).
3.13 Absence of Liens and Encumbrances. Western Multiplex and each of
its subsidiaries has good and valid title to, or, in the case of leased
properties, including the Western Multiplex Leases, valid leasehold interests
in, all of its tangible properties and assets, real, personal and mixed, used in
its business, free and clear of any liens or encumbrances except as reflected in
the Western Multiplex Financials and except for liens for taxes not yet due and
payable and such imperfections of title and encumbrances, if any, which would
not be material to Western Multiplex.
3.14 Environmental Matters.
(a) Hazardous Material. Except as reasonably would not be likely
to result in a material liability to Western Multiplex, no underground storage
tanks and no Hazardous Materials are present as a result of the actions of
Western Multiplex, of its subsidiaries or any affiliate of Western Multiplex, or
to the Knowledge of Western Multiplex, as a result of any actions of any third
party, or otherwise, in, on or under any property, including the land and the
improvements, ground water and surface water thereof, that Western Multiplex or
any of its subsidiaries has at any time owned, operated, occupied or leased.
(b) Hazardous Materials Activities. Except as reasonably would
not be likely to result in a material liability to Western Multiplex (in any
individual case or in the aggregate), (i) neither Western Multiplex nor any of
its subsidiaries has transported, stored, used, manufactured, disposed of,
released or exposed its employees or others to Hazardous Materials in violation
of any law in effect on or before the Closing Date, and (ii) neither Western
Multiplex nor any of its subsidiaries has engaged in Hazardous Materials
Activities in violation of any law, rule, regulation, treaty or statute
promulgated by any Governmental Entity in effect on or prior to or as of the
Closing Date to prohibit, regulate or control Hazardous Materials or any
Hazardous Material Activity or in a manner that would be likely to result in
material liability to Western Multiplex.
(c) Permits. Except as reasonably would not be likely to result
in a material liability to Western Multiplex, Western Multiplex and its
subsidiaries currently hold all environmental approvals, permits, licenses,
clearances and consents (the "WESTERN MULTIPLEX ENVIRONMENTAL PERMITS")
necessary for the conduct of Western Multiplex's and its subsidiaries'
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Hazardous Material Activities and other businesses of Western Multiplex and its
subsidiaries as such activities and businesses are currently being conducted.
(d) Environmental Liabilities. No action, proceeding, revocation
proceeding, amendment procedure, writ, injunction or claim is pending, or to
Western Multiplex's Knowledge, threatened concerning any Western Multiplex
Environmental Permit, Hazardous Material or any Hazardous Materials Activity of
Western Multiplex or any of its subsidiaries.
3.15 Labor Matters. (i) There are no controversies pending or, to the
Knowledge of each of Western Multiplex and its respective subsidiaries,
threatened, between Western Multiplex or any of its subsidiaries and any of
their respective employees or former employees; (ii) as of the date of this
Agreement, neither Western Multiplex nor any of its subsidiaries is a party to
any collective bargaining agreement or other labor union contract applicable to
persons employed by Western Multiplex or its subsidiaries nor does Western
Multiplex or its subsidiaries know of any activities or proceedings of any labor
union to organize any such employees; and (iii) as of the date of this
Agreement, neither Western Multiplex nor any of its subsidiaries has any
Knowledge of any strikes, slowdowns, work stoppages or lockouts, or threats
thereof, by or with respect to any employees of Western Multiplex or any of its
subsidiaries.
3.16 Agreements, Contracts and Commitments. The following agreements,
contracts or commitments with respect to which Western Multiplex or one of its
subsidiaries is a party or is bound are referred to herein as the "WESTERN
MULTIPLEX CONTRACTS":
(a) any employment or consulting agreement, contract or
commitment with any officer or director or higher level employee or member of
Western Multiplex's Board of Directors, other than those that are terminable by
Western Multiplex or any of its subsidiaries on no more than thirty (30) days'
notice without liability or financial obligation to Western Multiplex;
(b) any agreement or plan, including, without limitation, any
stock option plan, stock appreciation right plan or stock purchase plan, any of
the benefits of which will be increased, or the vesting of benefits of which
will be accelerated, by the occurrence of any of the transactions contemplated
by this Agreement or the value of any of the benefits of which will be
calculated on the basis of any of the transactions contemplated by this
Agreement;
(c) any agreement of indemnification or any guaranty other than
any agreement of indemnification entered into in connection with the sale or
license of software products in the ordinary course of business;
(d) any agreement, contract or commitment containing any
covenant limiting in any respect the right of Western Multiplex or any of its
subsidiaries to engage in any line of business or to compete with any person or
granting any exclusive distribution rights;
(e) any agreement, contract or commitment currently in force
relating to the disposition or acquisition by Western Multiplex or any of its
subsidiaries after the date of this Agreement of assets in excess of $250,000
not in the ordinary course of business or pursuant to
-35-
which Western Multiplex has any material ownership interest in any corporation,
partnership, joint venture or other business enterprise other than Western
Multiplex's subsidiaries;
(f) any dealer, distributor, joint marketing or development
agreement currently in force under which Western Multiplex or any of its
subsidiaries have continuing material obligations to jointly market any product,
technology or service and which may not be canceled without penalty upon notice
of ninety (90) days or less, or any material agreement pursuant to which Western
Multiplex or any of its subsidiaries have continuing material obligations to
jointly develop any intellectual property that will not be owned, in whole or in
part, by Western Multiplex or any of its subsidiaries and which may not be
canceled without penalty upon notice of ninety (90) days or less;
(g) any material agreement, contract or commitment currently in
force to license any third party to manufacture or reproduce any Western
Multiplex product or service or any material agreement, contract or commitment
currently in force to sell or distribute any Western Multiplex products or
service, including any Western Multiplex Material IP Contract, except agreements
with distributors or sales representative in the normal course of business
cancelable without penalty upon notice of ninety (90) days or less and
substantially in the form previously provided to Proxim;
(h) any mortgages, indentures, guarantees, loans or credit
agreements, security agreements or other agreements or instruments relating to
the borrowing of money or extension of credit;
(i) any settlement agreement; provided that a Western Multiplex
Contract shall not include any settlement agreement entered into more than five
(5) years before the date of this Agreement; or
(j) any other agreement, contract or commitment (i) in
connection with or pursuant to which Western Multiplex and its subsidiaries will
spend or receive (or are expected to spend or receive), in the aggregate, more
than $250,000 during the current calendar year or during the next calendar year,
(ii) the termination, expiration or loss of the counterparty's performance of
which could reasonably be expected to have a Material Adverse Effect on Western
Multiplex or (iii) that is a material contract (as defined in Item 601(b)(10) of
Regulation S-K of the SEC rules).
Neither Western Multiplex nor any of its subsidiaries, nor to Western
Multiplex's Knowledge any other party to a Western Multiplex Contract is in
material breach, violation or default under, and neither Western Multiplex nor
any of its subsidiaries has received written notice that it has materially
breached, violated or defaulted under, any of the terms or conditions of any of
the Western Multiplex Contracts in such a manner as would permit any other party
to cancel or terminate any such Western Multiplex Contract, or would permit any
other party to seek material damages or other remedies (for any or all of such
breaches, violations or defaults, in the aggregate).
3.17 Title to Western Multiplex Properties. Western Multiplex owns no
real property nor has it ever owned any real property. All current Western
Multiplex leases, subleases or other occupancy contracts or agreements and each
amendment or other modification thereto (the
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"WESTERN MULTIPLEX LEASES") are in full force and effect and are valid and
enforceable. Western Multiplex is not in breach of or in default under any of
such current Western Multiplex Leases and no event or condition has occurred
which could (with the giving of notice or the passage of time or both)
constitute a breach of or default by Western Multiplex under any such current
Western Multiplex Lease. To Western Multiplex's Knowledge, no other party to any
such current Western Multiplex Lease is in breach of or in default under any
such current Western Multiplex Leases and no event or condition has occurred
which could (with the giving of notice or the passage of time or both)
constitute a breach of or default by Western Multiplex under any such current
Western Multiplex Lease. No party other than Western Multiplex has the right to
occupy any Western Multiplex real property currently leased or otherwise
occupied by Western Multiplex.
3.18 Statements; Joint Proxy Statement/Prospectus. None of the
information supplied or to be supplied by Western Multiplex for inclusion or
incorporation by reference in (i) the Registration Statement will at the time it
becomes effective under the Securities Act, 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 not misleading and (ii) the
Joint Proxy Statement/Prospectus shall not, on the date the Joint Proxy
Statement/Prospectus is first mailed to Western Multiplex's stockholders and
Proxim's stockholders, at the time of the Western Multiplex Stockholders'
Meeting or the Proxim Stockholders' Meeting and at the Effective Time, 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 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 Western Multiplex Stockholders' Meeting or the Proxim
Stockholders' Meeting which has become false or misleading. The Joint Proxy
Statement/Prospectus will comply as to form in all material respects with the
provisions of the Exchange Act and the rules and regulations thereunder. If at
any time before the Effective Time, any event relating to Western Multiplex or
any of its affiliates, officers or directors should be discovered by Western
Multiplex which should be set forth in an amendment to the Registration
Statement or a supplement to the Joint Proxy Statement/Prospectus, Western
Multiplex shall promptly inform Proxim. Notwithstanding the foregoing, Western
Multiplex makes no representation or warranty with respect to any information
supplied by Proxim that is contained in any of the foregoing documents.
3.19 Board Approval. The Board of Directors of Western Multiplex (i) has
determined that the Merger is advisable, consistent with and in furtherance of
the long-term business strategy of Western Multiplex and fair to, and in the
best interests of, Western Multiplex and its stockholders, (ii) has approved
this Agreement, the Merger and the other transactions contemplated by this
Agreement and (iii) has approved and determined to recommend that the
stockholders of Western Multiplex vote to approve the Share Issuance
(collectively, the "WESTERN MULTIPLEX BOARD RECOMMENDATION," and each of the
Western Multiplex Board Recommendation and the Proxim Board Recommendation are
hereinafter referred to, as applicable, a "BOARD RECOMMENDATION").
3.20 Opinion of Financial Advisor. The Board of Directors of Western
Multiplex has received an opinion from Credit Suisse First Boston Corporation
dated the date of this Agreement, to
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the effect that, as of such date, the Exchange Ratio is fair, from a financial
point of view to Western Multiplex, a signed copy of which opinion will be
delivered to Proxim solely for informational purposes as promptly as practicable
after receipt thereof by Western Multiplex.
3.21 Vote Required. The affirmative vote of the holders of a majority of
the shares of Western Multiplex Common Stock entitled to vote, present in person
or proxy, on the Share Issuance is the only vote of the holders of any class or
series of Western Multiplex's capital stock necessary to approve this Agreement
and the transactions contemplated hereby.
3.22 State Takeover Statutes. The Board of Directors of Western
Multiplex has approved this Agreement and the Western Multiplex Voting Agreement
and the Merger and the other transactions contemplated hereby and thereby, and
such approval is sufficient to render inapplicable to the Merger and the other
transactions contemplated hereby and thereby the restrictions contained in
Section 203 of the Delaware Law, to the extent, if any, such restrictions would
otherwise be applicable to the Merger and the other transactions contemplated by
this Agreement and the Western Multiplex Voting Agreement. No other state
takeover statute or similar statute or regulation applies or purports to apply
to the Merger, this Agreement, the Western Multiplex Voting Agreement or the
transactions contemplated hereby and thereby.
ARTICLE IV
CONDUCT PRIOR TO THE EFFECTIVE TIME
4.1 Conduct of Business by Proxim. During the period from the date of
this Agreement and continuing until the earlier of the termination of this
Agreement pursuant to its terms or the Effective Time, Proxim (which for the
purposes of this Article IV shall include Proxim and each of its subsidiaries)
agrees, except (i) as specifically provided in this Agreement or Article IV of
the Proxim Disclosure Letter or (ii) to the extent that Western Multiplex shall
otherwise consent in writing (the provision of a response to any request for
such a consent not be unreasonably delayed), to carry on its business diligently
and in accordance with good commercial practice and to carry on its business in
the usual, regular and ordinary course, in substantially the same manner as
heretofore conducted and in compliance with all applicable laws and regulations,
to pay its debts and taxes when due subject to good faith disputes over such
debts or taxes, to pay or perform other material obligations when due, and use
its commercially reasonable efforts consistent with past practices and policies
to preserve intact its present business organization, keep available the
services of its present officers and employees and preserve its relationships
with customers, suppliers, distributors, licensors, licensees and others with
which it has business dealings. In addition, except (x) as specifically provided
in this Agreement or Article IV of the Proxim Disclosure Letter or (y) to the
extent that Western Multiplex shall otherwise consent in writing (the provision
of a response to any request for such a consent not be unreasonably delayed),
Proxim shall not do any of the following and shall prevent its subsidiaries from
doing any of the following:
(a) Accelerate, amend, modify or waive any stock repurchase
rights; accelerate, amend or modify the period of exercisability or other
material terms of options, warrants or restricted stock; reprice or exchange
options or warrants granted under any employee, consultant or
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director stock plans or otherwise; or authorize cash payments in exchange for
any options, warrants or restricted stock granted under any of such plans or
otherwise;
(b) Enter into any material partnership arrangements, joint
development agreements or strategic alliances;
(c) Grant any severance or termination pay (cash, equity or
otherwise) to any officer or employee except pursuant to written agreements
outstanding, or policies existing, on the date hereof and as previously
disclosed in the Proxim Schedule, or adopt any new severance plan or amend or
modify or alter in any manner any severance plan, agreement or arrangement
existing on the date hereof;
(d) Cancel, terminate, extend, amend or modify in any material
respect any intellectual property contract other than with respect to
intellectual property contracts which are not Proxim Material IP Contracts in
the ordinary course of business, or in connection with the intellectual property
litigation (or threatened litigation) described in the Proxim Disclosure Letter
or settlement of such litigation; provided, however, that any such action or
settlement in connection with the disclosed intellectual property litigation (or
threatened litigation) includes a general release in favor of Proxim (or its
successor) and does not require a material royalty or lump sum payment by Proxim
or material post-Closing obligation of Proxim (or its successor);
(e) Declare, set aside or pay any dividends on or make any other
distributions (whether in cash, stock, equity securities or property) in respect
of any capital stock or split, combine or reclassify any capital stock or issue
or authorize the issuance of any other securities in respect of, in lieu of or
in substitution for any capital stock;
(f) Purchase, redeem or otherwise acquire, directly or
indirectly, any shares of capital stock of Proxim or its subsidiaries, except
repurchases of unvested shares at cost in connection with the termination of the
employment relationship with any employee pursuant to stock option or purchase
agreements in effect on the date hereof;
(g) Issue, deliver, sell, authorize, pledge or otherwise
encumber or propose any of the foregoing with respect to any shares of capital
stock or any securities convertible into shares of capital stock, or
subscriptions, rights, warrants or options to acquire any shares of capital
stock or any securities convertible into shares of capital stock, or enter into
other agreements or commitments of any character obligating it to issue any such
shares or convertible securities, other than (i) the issuance, delivery and/or
sale of shares of Proxim Common Stock pursuant to the exercise of stock options
therefor outstanding as of the date of this Agreement and (ii) shares of Proxim
Common Stock issuable to participants in Proxim's 1993 Employee Stock Purchase
Plan (the "PROXIM PURCHASE PLAN") consistent with the terms thereof;
(h) Cause, permit or propose any amendments to any charter
document or bylaw of Proxim (or similar governing instruments of any
subsidiaries);
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(i) Acquire or agree to acquire by merging or consolidating
with, or by purchasing any equity interest in or a material portion of the
assets of, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof, or otherwise
acquire or agree to acquire any assets that are material, individually or in the
aggregate, to the business of Proxim, other than in the ordinary course of
business consistent with past practice;
(j) Sell, lease, license, encumber or otherwise dispose of, in
whole or in part, any properties (including Intellectual Property) or assets
except sales of inventory in the ordinary course of business consistent with
past practice, and except for the sale, lease or disposition (other than through
licensing, except for immaterial, non-exclusive licenses in the ordinary course
of business) of property or assets that are not material, individually or in the
aggregate, to the business of Proxim;
(k) Incur any indebtedness for borrowed money or guarantee any
such indebtedness of another person, issue or sell any debt securities or
options, warrants, calls or other rights to acquire any debt securities of
Proxim, enter into any "keep well" or other agreement to maintain any financial
statement condition or enter into any arrangement having the economic effect of
any of the foregoing other than (i) in connection with the financing of ordinary
course trade payables consistent with past practice or (ii) pursuant to existing
credit facilities in the ordinary course of business;
(l) Adopt or amend any employee benefit plan or employee stock
purchase or employee stock option plan, or enter into any employment contract or
collective bargaining agreement (other than offer letters and letter agreements
entered into in the ordinary course of business consistent with past practice
with employees who are terminable "at will"), pay any special bonus or special
remuneration (cash, equity or otherwise) to any director or employee, or
increase the salaries or wage rates or fringe benefits (including rights to
severance or indemnification) of its directors, officers, employees or
consultants;
(m) Make any individual or series of related payments outside of
the ordinary course of business in excess of $250,000;
(n) Except in the ordinary course of business consistent with
past practice, modify, amend or terminate any material contract or agreement to
which Proxim or any of its subsidiaries is a party, or waive, delay the exercise
of, release or assign any material rights or claims thereunder, in any case
which would be material to Proxim;
(o) Materially modify any material contract, agreement or
obligation relating to the distribution, sale, license or marketing by third
parties of Proxim's products or products licensed by Proxim;
(p) Revalue any of its assets or, except as required by GAAP,
adopt or change any accounting methods, principles or practices;
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(q) Enter into any closing agreement in respect of material
Taxes, settle any claim or assessment in respect of any material Taxes, or
consent to any extension or waiver of the limitation period applicable to any
claim or assessment in respect of any material Taxes;
(r) Incur or enter into any agreement or commitment in excess of
$500,000 individually;
(s) Hire any employee with an annual compensation level in
excess of $75,000;
(t) Pay, discharge or satisfy any claim, liability or obligation
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction of non-material amounts in the ordinary
course of business;
(u) Modify or amend in any manner that is adverse to Proxim, or
terminate, any material agreement or any confidentiality agreement entered into
by Proxim or any subsidiary in the ordinary course of business, or release or
waive any material rights for claims, or modify or amend in any manner adverse
to Proxim, any confidentiality, standstill or similar agreements to which Proxim
or any of its subsidiaries is a party;
(v) Make or change any material Tax election, change any method
of accounting with respect to any material Tax or file any material amended Tax
Return;
(w) Settle, compromise, commence or otherwise conduct or
prosecute in any manner not previously disclosed to Western Multiplex, any
material Action, arbitration, investigation, audit, controversy or similar
dispute or proceeding, except in connection with the intellectual property
litigation (or threatened litigation) described in the Proxim Disclosure Letter
or Proxim SEC Documents; provided, however, that any such action or settlement
in connection with the disclosed intellectual property litigation (or threatened
litigation) include a general release in favor of Proxim (or its successor) and
does not require a material royalty or lump sum payment by Proxim or material
post-Closing obligation of Proxim (or its successor) to any third party; or
(x) Redeem the Proxim Rights or amend, waive any rights under or
otherwise modify or terminate the Proxim Rights Plan in connection with an
Acquisition Proposal; or
(y) Agree in writing or otherwise to take any of the actions
described in Section 4.1(a) through (x) above.
4.2 Conduct of Business by Western Multiplex. During the period from the
date of this Agreement and continuing until the earlier of the termination of
this Agreement pursuant to its terms or the Effective Time, Western Multiplex
(which for the purposes of this Article IV shall include Western Multiplex and
each of its subsidiaries) agrees, except (i) as specifically provided in this
Agreement or Article IV of the Western Multiplex Disclosure Letter or (ii) to
the extent that Proxim shall otherwise consent in writing (the provision of a
response to any request for such consent not to be unreasonably delayed), to
carry on its business diligently and in accordance with good commercial practice
and to carry on its business in the usual, regular and ordinary course, in
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substantially the same manner as heretofore conducted and in compliance with all
applicable laws and regulations, to pay its debts and taxes when due subject to
good faith disputes over such debts or taxes, to pay or perform other material
obligations when due, and use its commercially reasonable efforts consistent
with past practices and policies to preserve intact its present business
organization, keep available the services of its present officers and employees
and preserve its relationships with customers, suppliers, distributors,
licensors, licensees and others with which it has business dealings. In
addition, except (x) as specifically provided in this Agreement or Article IV of
the Western Multiplex Disclosure Letter or (y) to the extent that Proxim shall
otherwise consent in writing (the provision of a response to any request for
such consent not to be unreasonably delayed), Western Multiplex shall not do any
of the following and shall prevent its subsidiaries from doing any of the
following:
(a) Accelerate, amend, modify or waive any stock repurchase
rights; accelerate, amend or modify the period of exercisability or other
material terms of options, warrants or restricted stock; reprice or exchange
options or warrants granted under any employee, consultant or director stock
plans or otherwise; or authorize cash payments in exchange for any options,
warrants or restricted stock granted under any of such plans or otherwise;
(b) Enter into any material partnership arrangements, joint
development agreements or strategic alliances;
(c) Grant any severance or termination pay (cash, equity or
otherwise) to any officer or employee except pursuant to written agreements
outstanding, or policies existing, on the date hereof and as previously
disclosed in the Western Multiplex Disclosure Letter, or adopt any new severance
plan or amend or modify or alter in any manner any severance plan, agreement or
arrangement existing on the date hereof;
(d) Cancel, terminate, extend, amend or modify in any material
respect any intellectual property contract other than with respect to
intellectual property contracts which are not Western Multiplex Material IP
Contracts, in the ordinary course of business;
(e) Declare, set aside or pay any dividends on or make any other
distributions (whether with cash, stock, equity securities or property) in
respect of any capital stock or split, combine or reclassify any capital stock
or issue or authorize the issuance of any other securities in respect of, in
lieu of or in substitution for any capital stock;
(f) Purchase, redeem or otherwise acquire, directly or
indirectly, any shares of capital stock of Western Multiplex or its
subsidiaries, except repurchases of unvested shares at cost in connection with
the termination of the employment relationship with any employee pursuant to
stock option or purchase agreements in effect on the date hereof;
(g) Issue, deliver, sell, authorize, pledge or otherwise
encumber or propose any of the foregoing with respect to any shares of capital
stock or any securities convertible into shares of capital stock, or
subscriptions, rights, warrants or options to acquire any shares of capital
stock or any securities convertible into shares of capital stock, or enter into
other agreements or commitments
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of any character obligating it to issue any such shares or convertible
securities, other than (i) the issuance, delivery and/or sale of shares of
Western Multiplex Common Stock pursuant to the exercise of stock options
therefor outstanding as of the date of this Agreement and (ii) shares of Western
Multiplex Common Stock issuable to participants in Western Multiplex's Employee
Stock Purchase Plan consistent with the terms thereof;
(h) Cause, permit or propose any amendments to the Certificate
of Incorporation or Bylaws of Western Multiplex;
(i) Acquire or agree to acquire by merging or consolidating
with, or by purchasing any equity interest in or a material portion of the
assets of, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof, or otherwise
acquire or agree to acquire any assets that are material, individually or in the
aggregate, to the business of Western Multiplex, other than in the ordinary
course of business consistent with past practice;
(j) Sell, lease, license, encumber or otherwise dispose of any
properties (including Intellectual Property) or assets except sales of inventory
in the ordinary course of business consistent with past practice, except for the
sale, lease or disposition (other than through licensing, except for immaterial,
non-exclusive licenses in the ordinary course of business) of property or assets
that are not material, individually or in the aggregate, to the business of
Western Multiplex;
(k) Incur any indebtedness for borrowed money or guarantee any
such indebtedness of another person, issue or sell any debt securities or
options, warrants, calls or other rights to acquire any debt securities of
Western Multiplex, enter into any "keep well" or other agreement to maintain any
financial statement condition or enter into any arrangement having the economic
effect of any of the foregoing other than (i) in connection with the financing
of ordinary course trade payables consistent with past practice or (ii) pursuant
to existing credit facilities in the ordinary course of business;
(l) Adopt or amend any employee benefit plan or employee stock
purchase or employee stock option plan, or enter into any employment contract or
collective bargaining agreement (other than offer letters and letter agreements
entered into in the ordinary course of business consistent with past practice
with employees who are terminable "at will"), pay any special bonus or special
remuneration to any director or employee, or increase the salaries or wage rates
or fringe benefits (including rights to severance or indemnification) of its
directors, officers, employees or consultants;
(m) Make any individual or series of related payments outside of
the ordinary course of business in excess of $250,000;
(n) Except in the ordinary course of business consistent with
past practice, modify, amend or terminate any material contract or agreement to
which Western Multiplex or any of its subsidiaries is a party or waive, delay
the exercise of, release or assign any material rights or claims thereunder, in
any case which would be material to Western Multiplex;
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(o) Materially modify any material contract, agreement or
obligation relating to the distribution, sale, license or marketing by third
parties of Western Multiplex's products or products licensed by Western
Multiplex;
(p) Revalue any of its assets or, except as required by GAAP,
adopt or change any accounting methods, principles or practices;
(q) Enter into any closing agreement in respect of any material
Taxes, settle any claim or assessment in respect of any material Taxes, or
consent to any extension or waiver of the limitation period applicable to any
claim or assessment in respect of any material Taxes;
(r) Incur or enter into any agreement or commitment in excess of
$500,000;
(s) Hire any employee with an annual compensation level in
excess of $75,000;
(t) Pay, discharge or satisfy any claim, liability or obligation
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in non-material amounts in the ordinary
course of business;
(u) Modify or amend in any manner that is adverse to Western
Multiplex, or terminate, any material agreement or any confidentiality agreement
entered into by Western Multiplex or any subsidiary in the ordinary course of
business, or release or waive any material rights for claims, or modify or amend
in any manner adverse to Western Multiplex, any confidentiality, standstill or
similar agreements to which Western Multiplex or any of its subsidiaries is a
party;
(v) Make or change any material Tax election, change any method
of accounting with respect to any material Tax or file any material amended Tax
Return;
(w) Settle, compromise, commence or otherwise conduct or
prosecute in any manner not previously disclosed to Proxim, any material Action,
arbitration, investigation, audit, controversy or similar dispute or proceeding;
or
(x) Agree in writing or otherwise to take any of the actions
described in Section 4.1(a) through (w) above.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 Prospectus/Proxy Statement; Registration Statement. As promptly as
practicable after the execution of this Agreement, Western Multiplex and Proxim
will prepare and file with the SEC the Prospectus/Proxy Statement, and Western
Multiplex will prepare and file with the SEC the Registration Statement in which
the Prospectus/Proxy Statement is to be included as a prospectus. Western
Multiplex and Proxim will provide each other with any information which may be
required in order to effectuate the preparation and filing of the
Prospectus/Proxy Statement and the
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Registration Statement pursuant to this Section 5.1. Each of Western Multiplex
and Proxim will respond to any comments from the SEC, will use all reasonable
efforts to cause the Registration Statement to be declared effective under the
Securities Act as promptly as practicable after such filing and to keep the
Registration Statement effective as long as is necessary to consummate the
Merger and the transactions contemplated hereby. Each of Western Multiplex and
Proxim will notify the other promptly upon the receipt of any comments from the
SEC or its staff in connection with the filing of, or amendments or supplements
to, the Registration Statement and/or the Prospectus/Proxy Statement. Whenever
any event occurs which is required to be set forth in an amendment or supplement
to the Prospectus/Proxy Statement, the Registration Statement, Western Multiplex
or Proxim, as the case may be, will promptly inform the other of such occurrence
and cooperate in filing with the SEC or its staff, and/or mailing to
stockholders of Western Multiplex and/or Proxim, such amendment or supplement.
Each of Western Multiplex and Proxim shall cooperate and provide the other with
a reasonable opportunity to review and comment on any amendment or supplement to
the Registration Statement and Prospect/Proxy Statement prior to filing such
with the SEC, and will provide each other with a copy of all such filings made
with the SEC. Each of Western Multiplex and Proxim will cause the
Prospectus/Proxy Statement to be mailed to its respective stockholders at the
earliest practicable time after the Registration Statement is declared effective
by the SEC.
5.2 Meetings of Stockholders; Board Recommendation.
(a) Meeting of Stockholders. Promptly after the date hereof,
each of Western Multiplex and Proxim will take all action necessary or advisable
in accordance with Delaware Law and its respective Certificate of Incorporation
and Bylaws to call, hold and convene the Proxim Stockholders' Meeting and the
Western Multiplex Stockholders' Meeting to consider, in the case of Western
Multiplex, the Share Issuance, and in the case of Proxim, adoption of this
Agreement, respectively (each, a "STOCKHOLDERS' MEETING"), to be held as
promptly as practicable. Subject to Sections 5.3(d) and 7.1, Western Multiplex
and Proxim will use their reasonable best efforts to solicit from the
stockholders of Proxim and Western Multiplex proxies in favor of, in the case of
Western Multiplex, the Share Issuance, and, in the case of Proxim, the adoption
of this Agreement, and will take all other action necessary or advisable to
secure the vote or consent of their respective stockholders required by the
rules of National Association of Securities Dealers, Inc. or Delaware Law to
obtain such approvals, including, without limitation, engaging one or more
nationally recognized proxy solicitation firms and information agents to assist
in such solicitation. Notwithstanding anything to the contrary contained in this
Agreement, Western Multiplex or Proxim, as the case may be, may adjourn or
postpone its Stockholders' Meeting to the extent necessary to ensure that any
necessary supplement or amendment to the Prospectus/Proxy Statement is provided
to its respective stockholders in advance of the vote to be taken at such
meeting or, if as of the time for which the Stockholders' Meeting is originally
scheduled (as set forth in the Prospectus/Proxy Statement) there are
insufficient shares of common stock of Western Multiplex or Proxim, as the case
may be, represented (either in person or by proxy) to constitute a quorum
necessary to conduct the business of such Stockholders' Meeting. Each of Western
Multiplex and Proxim shall ensure that its respective Stockholders' Meeting is
called, noticed, convened, held and conducted, and that all proxies solicited by
its in connection with the Stockholders' Meeting are
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solicited in compliance with Delaware Law, its Certificate of Incorporation and
Bylaws, the rules of the Nasdaq and all other applicable Legal Requirements.
Subject to Section 7.1(f) ,(g), (j) and (k), the obligation of Western Multiplex
or Proxim, as the case may be, to call, give notice of, convene and hold its
Stockholders' Meeting in accordance with this Section 5.2(a) shall not be
limited to or otherwise affected by the commencement, disclosure, announcement
or submission to it of any Acquisition Proposal (as defined in Section 5.3(h))
with respect to it, or by any withdrawal, amendment or modification of the
recommendation of its Board of Directors with respect to the Merger and/or this
Agreement.
(b) Board Recommendation. Except to the extent expressly
permitted by Section 5.3(d): (i) the Board of Directors of each of Western
Multiplex and Proxim shall make the applicable Board Recommendation to their
stockholders, (ii) the Prospectus/Proxy Statement shall include a statement to
the effect that the Board of Directors of each of Western Multiplex and Proxim
has made the applicable Board Recommendation and (iii) neither the Board of
Directors of Western Multiplex or Proxim nor any committee thereof shall
withdraw, amend or modify, or propose or resolve to withdraw, amend or modify in
a manner adverse to the other party, the applicable Board Recommendation.
5.3 Acquisition Proposals.
(a) No Solicitation. Each of Western Multiplex and Proxim agrees
that neither it nor any of its subsidiaries nor any of the officers, directors
and representatives (including any investment banker, attorney or accountant
retained by it or any of its subsidiaries) of it or its subsidiaries shall, and
that it shall use its reasonable best efforts to cause its and its subsidiaries'
employees and other agents not to (and shall not authorize any of them to)
directly or indirectly, (i) solicit, initiate, encourage, knowingly facilitate
or induce any inquiry with respect to, or the making, submission or announcement
of, any Acquisition Proposal with respect to itself, (ii) participate in any
discussions or negotiations regarding, or furnish to any Person any nonpublic
information with respect to, or take any other action to facilitate any
inquiries or the making of any proposal that constitutes or may reasonably be
expected to lead to, any Acquisition Proposal with respect to itself, (iii)
engage in discussions with any Person with respect to any Acquisition Proposal
with respect to itself, except as to the existence of the terms contained in
this Section 5.3(a), (iv) approve, endorse or recommend any Acquisition Proposal
with respect to itself (except to the extent specifically permitted pursuant to
Section 5.3(d)) or (v) enter into any letter of intent or similar document or
any contract, agreement or commitment contemplating or otherwise relating to any
Acquisition Proposal or transaction contemplated thereby with respect to itself.
Each of Western Multiplex and Proxim and their respective subsidiaries, and any
of the officers, directors and representatives (including any investment banker,
attorney or accountant retained by it or any of its subsidiaries) shall, and
shall use its reasonable best efforts to cause its and its subsidiaries'
employees and other agents to, immediately cease any and all existing
activities, discussions or negotiations with any third parties conducted
heretofore with respect to any Acquisition Proposal with respect to itself.
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(b) Notification of Unsolicited Acquisition Proposals.
(i) As promptly as practicable (but in any event within
one business day) after receipt of any Acquisition Proposal or any request for
nonpublic information or inquiry which it reasonably believes could lead to an
Acquisition Proposal, Western Multiplex or Proxim, as the case may be, shall
provide the other party hereto with written notice of the material terms and
conditions of such Acquisition Proposal, request or inquiry, and the identity of
the Person or group making any such Acquisition Proposal, request or inquiry and
a copy of all written materials provided in connection with such Acquisition
Proposal, request or inquiry. The recipient of the Acquisition Proposal, request
or inquiry shall keep the other party hereto informed as promptly as practicable
in all material respects of the status and details (including all amendments or
proposed amendments) of any such Acquisition Proposal, request or inquiry and
any discussions or negotiations it is having with the party making the
Acquisition Proposal, request or inquiry, and shall promptly provide to the
other party hereto a copy of all written and electronic materials subsequently
provided in connection with such Acquisition Proposal, request or inquiry.
(ii) Western Multiplex or Proxim, as the case may be,
shall provide the other party hereto with forty-eight (48) hours prior notice
(or such lesser prior notice as is provided to the members of its Board of
Directors) of any meeting of its Board of Directors at which its Board of
Directors is reasonably expected to consider any Acquisition Proposal.
(c) Superior Offers. Notwithstanding anything to the contrary
contained in Section 5.3(a), in the event that Western Multiplex or Proxim, as
the case may be, receives an unsolicited, bona fide written Acquisition Proposal
with respect to itself from a third party that its Board of Directors has in
good faith concluded (following consultation with its outside legal counsel and
its financial advisor) is a Superior Offer (as defined in Section 5.3(h)), it
may then take the following actions (but only if and to the extent that its
Board of Directors concludes in good faith, following consultation with its
outside legal counsel, that its fiduciary obligations under applicable law
require it to do so):
(i) Furnish nonpublic information to the third party
making such Acquisition Proposal, provided that (i) (A) concurrently with
furnishing any such nonpublic information to such party, its gives the other
party hereto written notice of its intention to furnish nonpublic information
and (B) it receives from the third party an executed confidentiality agreement,
the terms of which are at least as restrictive as the terms contained in the
Confidentiality Agreement (as defined in Section 5.4), and (ii)
contemporaneously with furnishing any such nonpublic information to such third
party, it furnishes such nonpublic information to the other party hereto (to the
extent such nonpublic information has not been previously so furnished); and
(ii) Engage in negotiations with the third party with
respect to the Acquisition Proposal, provided that three (3) business days prior
to entering into negotiations with such third party, it gives the other party
hereto written notice of the its intention to enter into negotiations with such
third party.
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(d) Changes of Recommendation. Notwithstanding anything to the
contrary contained in this Agreement, in response to the receipt of a Superior
Offer, the Board of Directors of Western Multiplex or Proxim, as the case may
be, may withhold, withdraw, amend or modify its recommendation in favor of the
Merger, and, in the case of a Superior Offer that is a tender or exchange offer
made directly to its stockholders, may recommend that its stockholders accept
the tender or exchange offer (any of the foregoing actions, whether by a Board
of Directors or a committee thereof, a "CHANGE OF RECOMMENDATION"), if all of
the following conditions in clauses (i) through (v) are met:
(i) A Superior Offer with respect to it has been made
and has not been withdrawn;
(ii) Its Stockholders' Meeting has not occurred or the
requisite vote of its stockholders to adopt this Agreement or to approve the
Share Issuance, as the case may be, has not been obtained;
(iii) It shall have (A) provided to the other party
hereto written notice which shall state expressly (1) that it has received a
Superior Offer, (2) the material terms and conditions of any Superior Offer it
has received and the identity of the Person or group making the Superior Offer,
(3) that it intends to effect a Change of Recommendation and the manner in which
it intends to do so (B) provided to the other party hereto a copy of all written
and electronic materials delivered to the Person or group making any Superior
Offer it has received, and (C) made available to the other party hereto all
materials and information made available to the Person or group making any
Superior Offer it has received;
(iv) Its Board of Directors has concluded in good faith,
after consultation with its outside legal counsel, that, in light of such
Superior Offer, the Change of Recommendation is required in order for the Board
of Directors to comply with its fiduciary obligations to its stockholders under
applicable law; and
(v) It shall not have breached any of the provisions set
forth in Section 5.2 or this Section 5.3 in connection with each Superior Offer.
(e) Termination following Receipt of a Superior Offer and a
Change of Recommendation. If a Superior Offer has been received by Proxim or
Western Multiplex, as the case may be, then subject to Section 5.3(d) and, with
respect to Proxim, Section 7.1(j), or, with respect to Western Multiplex,
Section 7.1(k), Proxim or Western Multiplex, as the case may be, may terminate
this Agreement pursuant to Section 7.1(j) or 7.1(k), respectively (and
concurrently with or after such termination, if it so chooses, the Board of
Directors of Proxim or Western Multiplex, as the case may be, may cause Proxim
or Western Multiplex to enter into any letter of intent, agreement in principle,
acquisition agreement or other similar agreement, but only after the third
business day following receipt by Western Multiplex or Proxim, as the case may
be, of written notice advising Western Multiplex or Proxim, as the case may be,
that Proxim or Western Multiplex is prepared to accept a Superior Offer.
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(f) Continuing Obligation to Call, Hold and Convene
Stockholders' Meeting; No Other Vote. Subject to Section 7.1, nothing contained
in this Agreement shall limit the obligation of Western Multiplex or Proxim to
call, hold and convene its respective Stockholders' Meeting (regardless of
whether its Board of Directors has effected a Change of Recommendation) in
accordance with Section 5.2. Neither Western Multiplex nor Proxim shall submit
to the vote of its respective stockholders any Acquisition Proposal, or propose
to do so.
(g) Compliance with Tender Offer Rules. Nothing contained in
this Agreement shall prohibit either party or its respective Board of Directors
from taking and disclosing to its stockholders a position contemplated by Rules
14d-9 and 14e-2(a) promulgated under the Exchange Act; provided that the content
of any such disclosure thereunder shall be subject to the terms of Section
5.3(c) of this Agreement. Without limiting the foregoing proviso, neither party
shall effect a Change of Recommendation unless specifically permitted pursuant
to the terms of Section 5.3(d).
(h) Certain Definitions. For purposes of this Agreement, the
following terms shall have the following meanings:
(i) "ACQUISITION PROPOSAL," with respect to a party,
shall mean any offer or proposal with respect to, or a transaction to effect, a
merger, reorganization, share exchange, consolidation, business combination,
recapitalization, liquidation, dissolution or similar transaction involving it
or any of its material subsidiaries, or any purchase or sale of 15% or more of
the consolidated assets (including without limitation stock of its subsidiaries)
of such party and its subsidiaries, taken as a whole, or any purchase or sale
of, or tender or exchange offer for, the equity securities of such party that,
if consummated, would result in any Person (or the stockholders of such Person)
beneficially owning or acquiring securities representing 15% or more of the
total voting power of such party (or of the surviving parent entity in such
transaction) or any of its material subsidiaries.
(ii) "SUPERIOR OFFER," with respect to a party, shall
mean an unsolicited, bona fide written Acquisition Proposal made by a third
party on terms that the Board of Directors of such party has in good faith
concluded (after consultation with its outside legal counsel and its financial
advisor), taking into account, among other things, all legal, financial,
regulatory and other aspects of the offer and the Person making the offer, to be
more favorable, from a financial point of view, to such party's stockholders (in
their capacities as stockholders) than the terms of the Merger and is reasonably
capable of being consummated, it being understood and agreed that the inclusion
of a due diligence condition in an Acquisition Proposal shall not in and of
itself preclude such Acquisition Proposal from being a Superior Offer for the
purposes of Section 5.3(c) hereof. For the purposes of this definition, the term
"Acquisition Proposal" shall have the meaning assigned to such term in Section
5.3(h)(i), except that references to "15%" therein shall be deemed to be
references to "40%".
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5.4 Confidentiality; Access to Information; No Modification of
Representations, Warranties or Covenants.
(a) Confidentiality. The parties acknowledge that Proxim and
Western Multiplex have previously executed a confidentiality agreement dated May
21, 2001 (the "CONFIDENTIALITY AGREEMENT"), which Confidentiality Agreement will
continue in full force and effect in accordance with its terms.
(b) Access to Information. Each of Proxim and Western Multiplex
will afford the other and the other's accountants, counsel and other
representatives reasonable access during normal business hours to its
properties, books, records and personnel during the period prior to the
Effective Time to obtain all information concerning its business, including the
status of product development efforts, properties, results of operations and
personnel, as such other party may reasonably request; provided, however, that
any party may restrict the foregoing access to the extent that any law, treaty,
rule or regulation of any Governmental Entity applicable to such party requires
such party or its subsidiaries to restrict or prohibit access to any such
properties or information. Any information provided pursuant to this Section
5.4(b) shall be subject to the Confidentiality Agreement.
(c) No Modification of Representations and Warranties or
Covenants. No information or knowledge obtained in any investigation or
notification pursuant to this Section 5.4, Section 5.6 or Section 5.7 shall
affect or be deemed to modify any representation or warranty contained herein,
the covenants or agreements of the parties hereto or the conditions to the
obligations of the parties hereto under this Agreement.
5.5 Public Disclosure. Without limiting any other provision of this
Agreement, Western Multiplex and Proxim will consult with each other and agree,
before issuing any press release or otherwise making any public statement with
respect to the Merger, this Agreement or any Acquisition Proposal and will not
issue any such press release or make any such public statement prior to such
consultation and agreement, except as may be required by law or any listing
agreement with the Nasdaq or any other applicable national securities exchange
(in which case Western Multiplex and Proxim will first consult with the other
party to the extent reasonably practicable). The parties have agreed to the text
of the joint press release announcing the signing of this Agreement.
5.6 Regulatory Filings; Reasonable Efforts.
(a) Regulatory Filings. Each of Western Multiplex and Proxim
shall coordinate and cooperate with one another and shall each use all
reasonable efforts to comply with, and shall each refrain from taking any action
that would impede compliance with, all Legal Requirements, and as promptly as
practicable after the date hereof, each of Western Multiplex and Proxim shall
make all filings reasonably determined by the parties to be required by any
Governmental Entity in connection with the Merger and the transactions
contemplated hereby, including, without limitation, (i) Notification and Report
Forms with the United States Federal Trade Commission (the "FTC") and the
Antitrust Division of the United States Department of Justice ("DOJ") as
required by the
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HSR Act, (ii) any other comparable filing that will materially impair the
ability of the parties to close, (iii) other comparable pre-merger filings
pursuant to the merger notification or control laws of any applicable
jurisdiction, as agreed by the parties hereto and (iv) any filings required
under the Securities Act, the Exchange Act, any applicable state or securities
or "blue sky" laws and the securities laws of any foreign country, or any other
Legal Requirement relating to the Merger. Each of Western Multiplex and Proxim
will cause all documents that it is responsible for filing with any Governmental
Entity under this Section 5.4(a) to comply in all material respects with all
applicable Legal Requirements.
(b) Exchange of Information. Western Multiplex and Proxim each
shall promptly supply the other with any information that may be required in
order to effectuate any filings or application pursuant to Section 5.6(a).
Except where prohibited by applicable Legal Requirements, and subject to the
Confidentiality Agreement, each of Proxim and Western Multiplex shall consult
with the other prior to taking a position with respect to any such filing, shall
consider in good faith the views of one another in connection with any analyses,
appearances, presentations, memoranda, briefs, Proxim papers, arguments,
opinions and proposals before making or submitting any of the foregoing to any
Governmental Entity by or on behalf of any party hereto in connection with any
investigations or proceedings in connection with this Agreement or the
transactions contemplated hereby (including under any antitrust or fair trade
Legal Requirement), coordinate with the other in preparing and exchanging such
information and promptly provide the other with copies of all filings,
presentations or submissions (and a summary of any oral presentations) made by
such party with any Governmental Entity in connection with this Agreement or the
transactions contemplated hereby, provided that with respect to any such filing,
presentation or submission, each of Western Multiplex and Proxim need not supply
the other with copies (or in case of oral presentations, a summary) to the
extent that any law, treaty, rule or regulation of any Governmental Entity
applicable to such party requires such party or its subsidiaries to restrict or
prohibit access to any such properties or information.
(c) Notification. Each of Western Multiplex and Proxim will
notify the other promptly upon the receipt of (i) any comments from any
officials of any Governmental Entity in connection with any filings made
pursuant hereto and (ii) any request by any officials of any Governmental Entity
for amendments or supplements to any filings made pursuant to, or information
provided to comply in all material respects with, any Legal Requirements.
Whenever any event occurs that is required to be set forth in an amendment or
supplement to any filing made pursuant to Section 5.6(a), Western Multiplex or
Proxim, as the case may be, will promptly inform the other of such occurrence
and cooperate in filing with the applicable Governmental Entity such amendment
or supplement.
(d) Reasonable Best Efforts. Subject to the express provisions of
Section 5.2 and Section 5.3 hereof and upon the terms and subject to the
conditions set forth herein, each of the parties agrees to use reasonable best
efforts to take, or cause to be taken, all actions, and to do, or cause to be
done, and to assist and cooperate with the other parties in doing, all things
necessary, proper or advisable to consummate and make effective, in the most
expeditious manner practicable, the Merger and the other transactions
contemplated by this Agreement, including using reasonable
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best efforts to accomplish the following: (i) the taking of all reasonable acts
necessary to cause the conditions precedent set forth in Article VI to be
satisfied, (ii) the obtaining of all necessary actions or nonactions, waivers,
consents, approvals, orders and authorizations from Governmental Entities and
the making of all necessary registrations, declarations and filings (including
registrations, declarations and filings with Governmental Entities, if any) and
the taking of such reasonable steps as may be necessary to avoid any suit,
claim, action, investigation or proceeding by any Governmental Entity, (iii) the
obtaining of all necessary consents, approvals or waivers from third parties,
including all Necessary Consents, (iv) the defending of any suits, claims,
actions, investigations or proceedings, whether judicial or administrative,
challenging this Agreement or the consummation of the transactions contemplated
hereby, including seeking to have any stay or temporary restraining order
entered by any court or other Governmental Entity vacated or reversed and (v)
the execution or delivery of any additional instruments necessary to consummate
the transactions contemplated by, and to fully carry out the purposes of, this
Agreement. In connection with and without limiting the foregoing, Proxim and its
Board of Directors shall, if any takeover statute or similar Legal Requirement
is or becomes applicable to the Merger, this Agreement or any of the
transactions contemplated by this Agreement, use all reasonable efforts to
ensure that the Merger and the other transactions contemplated by this Agreement
may be consummated as promptly as practicable on the terms contemplated by this
Agreement and otherwise to minimize the effect of such Legal Requirement on the
Merger, this Agreement and the transactions contemplated hereby.
(e) Limitation on Divestiture. Notwithstanding anything in this
Agreement to the contrary, nothing contained in this Agreement shall be deemed
to require Western Multiplex or Proxim or any subsidiary or affiliate thereof to
agree to any divestiture by itself or any of its affiliates of shares of capital
stock or of any business, assets or property, or the imposition of any material
limitation on the ability of any of them to conduct their businesses or to own
or exercise control of such assets, properties and stock. Proxim shall not take
or agree to take any action identified in the immediately preceding sentence
without the prior written consent of Western Multiplex.
5.7 Notification of Certain Matters.
(a) By Proxim. Proxim shall give prompt notice to Western
Multiplex when and if Proxim becomes aware that any representation or warranty
made by it contained in this Agreement has become untrue or inaccurate, or that
it has failed to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it under this Agreement, in each case such that
the conditions set forth in Section 6.3(a) or 6.3(b) would not be satisfied.
(b) By Western Multiplex. Western Multiplex shall give prompt
notice to Proxim when and if Western Multiplex becomes aware that any
representation or warranty made by it contained in this Agreement has become
untrue or inaccurate, or that it has failed to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by it under
this Agreement, in each case, such that the conditions set forth in Section
6.2(a) or 6.2(b) would not be satisfied.
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5.8 Third-Party Consents. As soon as practicable following the date
hereof, Western Multiplex and Proxim will each use commercially reasonable
efforts to obtain any material consents, waivers and approvals under any of its
or its subsidiaries' respective Contracts required to be obtained in connection
with the consummation of the transactions contemplated hereby.
5.9 Stock Options and Employee Benefits.
(a) Assumption of Stock Options. The parties hereto shall take
all requisite action so that, at the Effective Time, each then outstanding
Proxim Option, whether or not exercisable at the Effective Time and regardless
of the respective exercise prices thereof, will be assumed by Western Multiplex.
Each Proxim Option so assumed by Western Multiplex under this Agreement will
continue to have, and be subject to, the same terms and conditions set forth in
the applicable Proxim Stock Option Plan (and any applicable stock option
agreement for such Proxim Option) immediately prior to the Effective Time
(including any repurchase rights or vesting provisions), except that (i) each
Proxim Option will be exercisable (or will become exercisable in accordance with
its terms) for that number of whole shares of Western Multiplex Common Stock
equal to the product of the number of shares of Proxim Common Stock that were
issuable upon exercise of such Proxim Option immediately prior to the Effective
Time multiplied by the Exchange Ratio, rounded down to the nearest whole number
of shares of Western Multiplex Common Stock and (ii) the per share exercise
price for the shares of Western Multiplex Common Stock issuable upon exercise of
such assumed Proxim Option will be equal to the quotient determined by dividing
the exercise price per share of Proxim Common Stock at which such Proxim Option
was exercisable immediately prior to the Effective Time by the Exchange Ratio,
rounded up to the nearest whole cent. Each assumed Proxim Option shall be vested
immediately following the Effective Time as to the same percentage of the total
number of shares subject thereto as it was vested as to immediately prior to the
Effective Time. As soon as reasonably practicable following the Closing Date,
Western Multiplex will issue to each person who holds an assumed Proxim Option a
document evidencing the foregoing assumption of such Proxim Option by Western
Multiplex.
(b) Incentive Stock Options. It is intended that Proxim Options
assumed by Western Multiplex shall qualify following the Effective Time as
incentive stock options as defined in Section 422 of the Code to the extent
Proxim Options qualified as incentive stock options immediately prior to the
Effective Time and the provisions of this Section 5.9 shall be applied
consistent with such intent.
(c) Proxim Purchase Plan. The parties hereto shall take all
requisite action so that, as of the Effective Time, the Proxim Purchase Plan
shall be terminated. The rights of participants in the Proxim Purchase Plan with
respect to any offering period then underway under the Proxim Purchase Plan
shall be determined by treating the last business day prior to the Effective
Time as the last day of such offering period and by making such other pro-rata
adjustments as may be necessary to reflect the shortened offering period but
otherwise treating such shortened offering period as a fully effective and
completed offering period for all purposes under the Proxim Purchase Plan. Prior
to the effective time, Proxim shall take all actions (including, if appropriate,
amending the terms of the Proxim Purchase Plan) that are necessary to give
effect to the transactions
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contemplated by this Section 5.9(c). Western Multiplex shall permit Proxim
employees to participate in the Western Multiplex Purchase Plan no later than
the later of ten (10) days and the beginning of the first complete pay period
following the Closing Date, and Western Multiplex shall take all actions
(including, if appropriate, amending the terms of the Western Multiplex
Corporation Employee Stock Purchase Plan (the "WESTERN MULTIPLEX PURCHASE PLAN")
as necessary to effectuate the participation of Proxim employees in the Western
Multiplex Purchase Plan.
(d) Change of Control Severance Agreements. Each of Proxim and
Western Multiplex acknowledge that the consummation of the Merger shall
constitute a "Change of Control" with respect to Proxim, as defined in and with
respect to the Change of Control Severance Agreements between Proxim and each of
Xxxxx X. Xxxx, Xxxxx X. Xxxxxx, Xxxxx X. Xxxxx, Xxxx X. Xxxxx, Xxxxxxx X. Xxxx,
Xxxxxxx X. Xxxxxxxx and Xxxxx Xxxxxxxxxx dated as of June 18, 1998, June 18,
1998, October 5, 1998, October 18, 1999, October 15, 2001, October 15, 2001, and
January 15, 2002, respectively.
5.10 Form S-8. Western Multiplex agrees to file a registration statement
on Form S-8 for the shares of Western Multiplex Common Stock issuable with
respect to assumed Proxim Options to the extent Form S-8 is available as soon as
is reasonably practicable after the Effective Time and shall maintain the
effectiveness of such registration statement thereafter for so long as any of
such options or other rights remain outstanding.
5.11 Indemnification.
(a) Indemnity. From and after the Effective Time, Western
Multiplex will, and will cause the Surviving Corporation to, fulfill and honor
in all respects the obligations of Proxim pursuant to any indemnification
agreements between Proxim and its directors and officers immediately prior to
the Effective Time (the "INDEMNIFIED PARTIES"), subject to applicable law. The
Certificate of Incorporation and Bylaws of the Surviving Corporation will
contain provisions with respect to exculpation and indemnification that are at
least as favorable to the Indemnified Parties as those contained in the
Certificate of Incorporation and Bylaws of the Company as in effect on the date
hereof, which provisions will not be amended, repealed or otherwise modified for
a period of six years from the Effective Time in any manner that would adversely
affect the rights thereunder of individuals who, immediately prior to the
Effective Time, were directors, officers, employees or agents of Proxim, unless
such modification is required by law.
(b) Insurance. For a period of six years after the Effective
Time, the Surviving Corporation will cause to be maintained in directors' and
officers' liability insurance maintained by Proxim covering those persons who
are currently covered by Proxim's directors' and officers' liability insurance
policy on terms comparable to those applicable to the current directors and
officers of Proxim for a period of six (6) years; provided, however, that in no
event will the Surviving Corporation be required to expend in excess of two
hundred percent (200%) of the annual premium currently paid by Proxim for such
coverage (and to the extent annual premium would exceed two hundred percent
(200%) of the annual premium currently paid by Proxim for such coverage, the
Surviving Corporation shall maintain the maximum amount of coverage as is
available for such two hundred percent (200%) of such annual premium).
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(c) Third-Party Beneficiaries. This Section 5.11 is intended to
be for the benefit of, and shall be enforceable by the Indemnified Parties and
their heirs and personal representatives and shall be binding on the Surviving
Corporation and its successors and assigns. In the event the Surviving
Corporation or its successor or assign (i) consolidates with or merges into any
other Person and shall not be the continuing or surviving corporation or entity
in such consolidation or merger or (ii) transfers all or substantially all of
its properties and assets to any Person, then, and in each case, proper
provision shall be made so that the successor and assign of the Surviving
Corporation honor the indemnification obligations set forth in this Section
5.11.
5.12 Board of Directors and Executive Officers of Western Multiplex;
Name Change.
(a) Board of Directors. The Board of Directors of Western
Multiplex will take all actions necessary such that effective as of the
Effective Time, three (3) directors of Proxim reasonably acceptable to Western
Multiplex, including Xxxxx X. Xxxx, shall become members of the Board of
Directors of Western Multiplex (the "PROXIM DESIGNATED DIRECTORS") and that
three (3) directors of Western Multiplex including Xxxxxxxx X. Xxxxx, shall
remain on the Board of Directors of Western Multiplex (the "WESTERN MULTIPLEX
DESIGNATED DIRECTORS") and that a seventh director reasonably acceptable to each
of the Proxim Designated Directors and the Western Multiplex Designated
Directors shall become a member of the Board of Directors of Western Multiplex.
The Board of Directors of Western Multiplex will take all actions necessary to
ensure that each of the three classes of directors of the Board of Directors of
Western Multiplex consists of one of the Proxim Designated Directors and one of
the Western Multiplex Designated Directors.
(b) Executive Officers. The Board of Directors of Western
Multiplex will take all actions necessary such that effective as of the
Effective Time, Xxxxxxxx X. Xxxxx shall be Chairman of the Board and Chief
Executive Officer, Xxxxx X. Xxxx shall be President and Chief Operating Officer,
Xxxxx X. Xxxxxx shall be Executive Vice President and Chief Financial Officer
and Xxxx Xxxxxxxxx shall be Executive Vice President, Technology and Co-Chief
Technology Officer, each to hold office from and after the Effective Time until
their respective successors are duly appointed and qualified in the manner
provided in the bylaws of Western Multiplex or as otherwise provided by law or
their earlier resignation or removal.
(c) Name Change. Immediately following the Effective Time,
Western Multiplex shall change its corporate name to "Proxim."
5.13 Nasdaq Listing. Prior to the Effective Time, Western Multiplex
agrees to use commercially reasonable efforts to authorize for listing on Nasdaq
National Market the shares of Western Multiplex Common Stock issuable, and those
required to be reserved for issuance, in connection with the Merger, subject to
official notice of issuance.
5.14 Proxim Affiliates; Restrictive Legend. Proxim will use all
reasonable efforts to deliver or cause to be delivered to Western Multiplex, as
promptly as practicable on or following the date hereof (but in any event within
ten (10) days), from each person who may reasonably be deemed to be an affiliate
of Proxim for purposes of Rule 145 promulgated under the Securities Act (a
"PROXIM AFFILIATE") an executed affiliate agreement in the form attached hereto
as Exhibit D (the
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"PROXIM AFFILIATE AGREEMENT"), each of which will be in full force and effect as
of the Effective Time. Western Multiplex will be entitled to place appropriate
legends on the certificates evidencing any Western Multiplex Common Stock to be
received by a Proxim Affiliate pursuant to the terms of this Agreement and to
issue appropriate stop transfer instructions to the transfer agent for the
Western Multiplex Common Stock, consistent with the terms of the Proxim
Affiliate Agreement.
5.15 Treatment as Reorganization. Neither Western Multiplex nor Proxim
will, nor will they permit any of their respective subsidiaries to, take any
action prior to or following the Closing that would reasonably be expected to
cause the Merger to fail to qualify as a reorganization with the meaning of
Section 368(a) of the Code.
5.16 Section 16 Matters. Prior to the Effective Time, the Board of
Directors of each of Western Multiplex and Proxim shall adopt a resolution
consistent with the interpretative guidance of the SEC so that (i) the
assumption of Proxim Options held by Proxim Insiders (as defined below) pursuant
to this Agreement, and (ii) the receipt by Proxim Insiders of Western Multiplex
Common Stock in exchange for Proxim Common Stock pursuant to the Merger, shall
be an exempt transaction for purposes of Section 16 of the Exchange Act by any
officer or director of Proxim who may become a covered person for purposes of
Section 16 of the Exchange Act (a "PROXIM INSIDER").
5.17 Assumption of Agreements. Prior to the Effective Time, in order to
facilitate the assignment to Western Multiplex of (a) the Siemens to Proxim
Technology License Agreement entered into as of September 21, 2000 by and
between Proxim and Siemens Aktiengesellschaft ("SIEMENS") (the "SIEMENS
TECHNOLOGY LICENSE AGREEMENT") and (b) the Original Equipment Manufacturer
Volume Sales Agreement entered into as of July 23, 2001 by and between Proxim
and Atheros Communications Inc. ("ATHEROS") (the "ATHEROS OEM AGREEMENT"),
Western Multiplex agrees to accept in writing, in form and substance reasonably
satisfactory to Siemens or Atheros, as the case may be, Proxim's rights and
obligations under (A) the following agreements entered into by and between
Proxim and Siemens: the Siemens Technology License Agreement; the Proxim to
Siemens Technology License and Manufacturing Rights Agreement entered into as of
September 21, 2000; the Asset Purchase Agreement entered into as of September
27, 2000; and the Amended and Restated Development Agreement entered into as of
September 23, 2000 and (B) the Atheros OEM Agreement; provided, however, that
nothing herein shall be deemed an admission or acknowledgement by Proxim or
Western Multiplex that any such consent is required in connection with or as a
result of the Merger or execution of this Agreement under the Siemens Technology
License Agreement or the Atheros OEM Agreement.
5.18 Bylaws of Proxim. Prior to the Effective Time, the Board of
Directors of Proxim shall take all actions necessary so that, at the Effective
Time, the Bylaws of Proxim shall be amended in their entirety to be identical to
the Bylaws of Merger Sub as in effect immediately prior to the Effective Time
until thereafter amended in accordance with Delaware Law as provided by in such
Bylaws.
5.19 Directors and Officers of the Surviving Corporation. Prior to the
Effective Time, the Board of Directors of Proxim shall take all actions
necessary so that, at the Effective Time, (i) the initial board of directors of
the Surviving Corporation shall be the directors of Merger Sub
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immediately prior to the Effective Time, until their respective successors are
duly elected or appointed and qualified and (ii) the initial officers of the
Surviving Corporation shall be the officers of Proxim immediately prior to the
Effective Time, until their respective successors are duly appointed.
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 effect the Merger
shall be subject to the satisfaction at or prior to the Closing Date of the
following conditions, any of which may be waived in writing by both of Proxim
and Western Multiplex:
(a) Stockholder Approval. Each of the Proxim Stockholder Approval
and the Western Multiplex Stockholder Approval shall have been obtained.
(b) No Order. No Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive order,
decree, injunction or other order (whether temporary, preliminary or permanent)
which is in effect and which has the effect of making the Merger illegal or
otherwise prohibiting consummation of the Merger.
(c) Registration Statement Effective; Prospectus/Proxy Statement.
The SEC 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 Prospectus/Proxy Statement, shall have been
initiated or threatened in writing by the SEC.
(d) HSR Act. The waiting period (and any extension thereof) under
the HSR Act relating to the transactions contemplated hereby will have expired
or terminated early. Satisfaction of all other material foreign antitrust
requirements reasonably determined to apply prior to the Closing in connection
with the transaction contemplated hereby shall have been obtained.
(e) No Governmental Restriction. There shall not be any pending
or threatened suit or action asserted by any Governmental Authority (i)
challenging or seeking to restrain or prohibit the consummation of the Merger or
any of the other transactions contemplated by this Agreement or (ii) seeking to
impose on Western Multiplex or Proxim or any subsidiary or affiliate thereof any
divestiture of shares of capital stock or of any business, assets or property,
or the imposition of any material limitation on the ability of any of them to
conduct their businesses or to own or exercise control of such assets,
properties and stock.
(f) Tax Opinions. Western Multiplex and Proxim shall each have
received written opinions from their respective counsel (Xxxxxxx Xxxxxxx &
Xxxxxxxx and Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation,
respectively), in form and substance reasonably satisfactory to them, to the
effect that the Merger will constitute a reorganization within the meaning of
Section 368(a) of the Code and such opinions shall not have been withdrawn. The
parties to this
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Agreement agree to make such reasonable representations as requested by such
counsel for the purpose of rendering such opinions.
(g) Nasdaq Listing. The shares of Western Multiplex Common Stock
to be issued in the Merger shall have been authorized for listing on the Nasdaq,
subject to official notice of issuance.
6.2 Additional Conditions to Obligations of Proxim. The obligation of
Proxim to consummate and effect the Merger shall be subject to the satisfaction
at or prior to the Closing Date of each of the following conditions, any of
which may be waived, in writing, exclusively by Proxim:
(a) Representations and Warranties. The representations and
warranties of Western Multiplex set forth in this Agreement (i) that are
qualified as to Material Adverse Effect shall be true and correct as of the date
of this Agreement and as of immediately prior to the Effective Time (except to
the extent such representations and warranties shall refer to a specific date,
in which case such representations and warranties shall have been so true and
correct as of such date) with the same force and effect as if then made, (ii)
contained in Section 3.2 shall be true and correct in all material respects as
of the date of this Agreement and as of immediately prior to the Effective Time,
and (iii) the other representations and warranties of Western Multiplex set
forth in this Agreement that are not qualified as to Material Adverse Effect
shall be true and correct in all respects the date of this Agreement and
immediately prior to the Effective Time (except to the extent such
representations and warranties shall have been made as of an earlier date, in
which case such representations and warranties shall have been true and correct
in all respects as of such earlier date) with the same force and effect as if
then made, except that this clause (iii) shall be deemed to be satisfied so long
as any failures of such representations and warranties to be true and correct
(without giving effect to any limitation as to "materiality" set forth therein),
taken together, have not had a Material Adverse Effect on Western Multiplex; and
Proxim shall have received a certificate of the Chief Executive Officer and the
Chief Financial Officer of Western Multiplex to such effect.
(b) Agreements and Covenants. Western Multiplex shall have
performed or complied in all material respects with all agreements and covenants
required by this Agreement to be performed or complied with by it on or prior to
the Closing Date, and Proxim shall have received a certificate to such effect
signed on behalf of Western Multiplex by the President and the Chief Financial
Officer of Western Multiplex.
(c) Employment Agreement. The Employment Agreement by and between
Western Multiplex and Xxxxx X. Xxxx shall not have been revoked or otherwise
terminated by Western Multiplex as of the Effective Time.
6.3 Additional Conditions to the Obligations of Western Multiplex. The
obligations of Western Multiplex to consummate and effect the Merger shall be
subject to the satisfaction at or prior to the Closing Date of each of the
following conditions, any of which may be waived, in writing, exclusively by
Western Multiplex:
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(a) Representations and Warranties. The representations and
warranties of Proxim set forth in this Agreement (i) that are qualified as to
Material Adverse Effect shall be true and correct as of the date of this
Agreement and as of immediately prior to the Effective Time (except to the
extent such representations and warranties shall refer to a specific date, in
which case such representations and warranties shall have been so true and
correct as of such date) with the same force and effect as if then made, (ii)
contained in Section 2.2 shall be true and correct in all material respects as
of the date of this Agreement and as of immediately prior to the Effective Time,
and (iii) the other representations and warranties of Proxim set forth in this
Agreement that are not qualified as to Material Adverse Effect shall be true and
correct in all respects as of the date of this Agreement and immediately prior
to the Effective Time (except to the extent such representations and warranties
shall have been made as of an earlier date, in which case such representations
and warranties shall have been true and correct in all respects as of such
earlier date) with the same force and effect as if then made, except that this
clause (iii) shall be deemed to be satisfied so long as any failures of such
representations and warranties to be true and correct (without giving any effect
to any limitation as to "materiality" set forth therein), taken together, have
not had a Material Adverse Effect on Proxim; and Western Multiplex shall have
received a certificate of the Chief Executive Officer and Chief Financial
Officer of Proxim to such effect.
(b) Agreements and Covenants. Proxim shall have performed or
complied in all material respects with all agreements and covenants required by
this Agreement to be performed or complied with by it at or prior to the Closing
Date, and Western Multiplex shall have received a certificate to such effect
signed on behalf of Proxim by the President and the Chief Financial Officer of
Proxim.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated at any time prior to
the Effective Time, by action taken or authorized by the Board of Directors of
the terminating party or parties, and except as provided below, whether before
or after the requisite approvals of the stockholders of Proxim or Western
Multiplex:
(a) by mutual written consent duly authorized by the Boards of
Directors of Western Multiplex and Proxim;
(b) by either Proxim or Western Multiplex if the Merger shall not
have been consummated by July 31, 2002 (the "END DATE"); provided, however, 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 a principal cause
of the failure of the Merger to occur on or before such date and such action or
failure to act constitutes a breach of this Agreement;
(c) by either Proxim or Western Multiplex if a Governmental
Entity shall have issued an order, decree or ruling or taken any other action
(including the failure to have taken an action), in any case having the effect
of permanently restraining, enjoining or otherwise prohibiting the Merger, which
order, decree, ruling or other action is final and nonappealable;
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(d) by either Proxim or Western Multiplex if the required
approval of the stockholders of Western Multiplex contemplated by this Agreement
shall not have been obtained by reason of the failure to obtain the required
vote at a meeting of Western Multiplex stockholders duly convened therefor or at
any adjournment or postponement thereof; provided, however, that the right to
terminate this Agreement under this Section 7.1(d) shall not be available to
Western Multiplex where the failure to obtain Western Multiplex stockholder
approval shall have been caused by the action or failure to act of Western
Multiplex and such action or failure to act constitutes a material breach by
Western Multiplex of this Agreement;
(e) by either Proxim or Western Multiplex if the required
approval of the stockholders of Proxim contemplated by this Agreement shall not
have been obtained by reason of the failure to obtain the required vote at a
meeting of the Proxim stockholders duly convened therefor or at any adjournment
or postponement thereof; provided, however, that the right to terminate this
Agreement under this Section 7.1(e) shall not be available to Proxim where the
failure to obtain Proxim stockholder approval shall have been caused by the
action or failure to act of Proxim and such action or failure to act constitutes
a material breach by Proxim of this Agreement;
(f) by Western Multiplex at any time prior to the adoption of
this Agreement by the required vote of the stockholders of Proxim if a
Triggering Event (as defined below in this Section 7.1) with respect to Proxim
shall have occurred.
(g) by Proxim at any time prior to the approval of Share Issuance
by the required vote of the stockholders of Western Multiplex if a Triggering
Event with respect to Western Multiplex shall have occurred.
(h) by Proxim, upon a breach of any representation, warranty,
covenant or agreement on the part of Western Multiplex set forth in this
Agreement, or if any representation or warranty of Western Multiplex shall have
become untrue, in either case such that the conditions set forth in Section
6.2(a) or Section 6.2(b) would not be satisfied as of the time of such breach or
as of the time such representation or warranty shall have become untrue,
provided that if such inaccuracy in Western Multiplex's representations and
warranties or breach by Western Multiplex is curable by Western Multiplex prior
to the End Date through the exercise of reasonable best efforts, then Proxim may
not terminate this Agreement under this Section 7.1(h) prior to the End Date,
provided that Western Multiplex continues to exercise its reasonable best
efforts to cure such inaccuracy or breach (it being understood that Proxim may
not terminate this Agreement pursuant to this paragraph (h) if such breach by
Western Multiplex is cured); and
(i) by Western Multiplex, upon a breach of any representation,
warranty, covenant or agreement on the part of Proxim set forth in this
Agreement, or if any representation or warranty of Proxim shall have become
untrue, in either case such that the conditions set forth in Section 6.3(a) or
Section 6.3(b) would not be satisfied as of the time of such breach or as of the
time such representation or warranty shall have become untrue, provided, that if
such inaccuracy in Proxim's representations and warranties or breach by Proxim
is curable by Proxim prior to the End Date through the exercise of reasonable
best efforts, then Western Multiplex may not terminate this Agreement under this
Section 7.1(i) prior to the End Date, provided that Proxim continues to
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exercise its reasonable best efforts to cure such inaccuracy or breach (it being
understood that Western Multiplex may not terminate this Agreement pursuant to
this paragraph (i) if such breach by Proxim is cured);
(j) by Proxim in accordance with Section 5.3(e) at any time prior
to the adoption of this Agreement by the required vote of the stockholders of
Proxim, provided that Proxim has complied with the provisions of Section 5.3 in
connection with the receipt of the applicable Superior Offer; and provided
further that any such termination will not be effective unless the Proxim
Termination Fee pursuant to Section 7.3(b)(i) shall have been paid concurrently
with or prior to such termination; or
(k) by Western Multiplex in accordance with Section 5.3(e) of
this Agreement at any time prior to the approval of the Share Issuance by the
required vote of the stockholders of Western Multiplex, provided that Western
Multiplex has complied with the provisions of Section 5.3 in connection with the
receipt of the applicable Superior Offer; provided further that any such
termination will not be effective unless the Western Multiplex Termination Fee
pursuant to Section 7.3(b)(ii) shall have been paid concurrently with or prior
to such termination.
For the purposes of this Agreement, a "TRIGGERING EVENT," with respect
to a party hereto, shall be deemed to have occurred if: (i) its Board of
Directors or any committee thereof shall for any reason have withdrawn or shall
have amended or modified in a manner adverse to the other party hereto its
applicable Board Recommendation, or shall have resolved to do any of the same
(ii) its Board of Directors fails to reaffirm (publicly, if so requested) its
applicable Board Recommendation within ten (10) business days after the other
party hereto requests in writing that such recommendation be reaffirmed after
the public announcement of an Acquisition Proposal, (iii) its Board of Directors
or any committee thereof shall have approved or recommended any Acquisition
Proposal, or shall have resolved to do any of the same, (iv) its Board of
Directors shall have failed to call, hold and convene its Stockholders' Meeting
in the manner contemplated by Section 5.2(a), (v) a tender or exchange offer
relating to its securities shall have been commenced by a Person unaffiliated
with the other party hereto and it shall not have sent to its securityholders
pursuant to Rule 14e-2 promulgated under the Securities Act, within ten (10)
business days after such tender or exchange offer is first published, sent or
given, a statement disclosing that the Board of Directors of such party
recommends rejection of such tender or exchange offer or (vi) with respect to
Proxim only, its Board of Directors shall have amended or resolved to amend the
Proxim Rights Agreement in a manner so as to render it inapplicable to any
Acquisition Proposal (other than the Merger).
7.2 Notice of Termination; Effect of Termination. Any termination of
this Agreement under Section 7.1 above will be effective immediately upon the
delivery of a valid written notice of the terminating party to the other party
hereto. In the event of the termination of this Agreement as provided in Section
7.1, this Agreement shall be of no further force or effect, except (i) as set
forth in Section 5.4(a), this Section 7.2, Section 7.3 and Article VIII, each of
which shall survive the termination of this Agreement and (ii) nothing herein
shall relieve any party from liability for fraud in connection with, or any
willful breach of, this Agreement. No termination of this Agreement shall
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affect the obligations of the parties contained in the Confidentiality
Agreement, all of which obligations shall survive termination of this Agreement
in accordance with their terms.
7.3 Fees and Expenses.
(a) General. 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 Western Multiplex and
Proxim shall share equally (i) all fees and expenses, other than attorneys' and
accountants' fees and expenses, incurred in relation to the printing and filing
(with the SEC) of the Prospectus/Proxy Statement (including any preliminary
materials related thereto) and the Registration Statement (including financial
statements and exhibits) and any amendments or supplements thereto and (ii) the
filing fee for the Notification and Report Forms filed with the FTC and DOJ
under the HSR Act or any other filing fee required by a Governmental Entity
pursuant to Section 5.6(a).
(b) Payments.
(i) Payment by Proxim. In the event that this
Agreement is terminated by Western Multiplex or Proxim, as applicable, pursuant
to Sections 7.1(b), (e), (f) or (j), or pursuant to Section 7.1(i) as the result
of a breach of covenant by Proxim subsequent to the receipt of an Acquisition
Proposal with respect to Proxim, Proxim shall promptly, but in no event later
than two (2) days after the date of such termination, pay Western Multiplex a
fee equal to Nine Million Five Hundred Thousand dollars ($9,500,000) in
immediately available funds (the "PROXIM TERMINATION FEE"); provided, that in
the case of termination under Section 7.1(b), 7.1(e) or 7.1(i) (as a result of a
breach of a covenant by Proxim subsequent to the receipt of an Acquisition
Proposal with respect to Proxim), (A) such payment shall be made only if
following the date hereof and prior to the termination of this Agreement, there
has been public disclosure of an Acquisition Proposal with respect to Proxim and
(1) within nine (9) months following the termination of this Agreement an
Acquisition (as defined in Section 7.3(b)(vi)) of Proxim is consummated or (2)
within nine (9) months following the termination of this Agreement Proxim enters
into an agreement providing for an Acquisition of Proxim and such Acquisition of
Proxim is subsequently consummated and (B) such payment shall be made prior to
and as a condition of the consummation of such Acquisition of Proxim.
(ii) Payment by Western Multiplex. In the event that
this Agreement is terminated by Western Multiplex or Proxim, as applicable,
pursuant to Sections 7.1(b), (d), (g) or (k), or pursuant to Section 7.1(h) upon
the breach of a covenant by Western Multiplex subsequent to the receipt of an
Acquisition Proposal with respect to Western Multiplex, Western Multiplex shall
promptly, but in no event later than two (2) days after the date of such
termination, pay Proxim a fee equal to Nine Million Five Hundred Thousand
dollars ($9,500,000) in immediately available funds (the "WESTERN MULTIPLEX
TERMINATION FEE"); provided, that in the case of termination under Section
7.1(b), 7.1(d) or 7.1(h) (as a result of a breach of a covenant by Western
Multiplex subsequent to the receipt of an Acquisition Proposal with respect to
Western Multiplex), (A) such payment shall be made only if following the date
hereof and prior to the termination of this
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Agreement, there has been public disclosure of an Acquisition Proposal with
respect to Western Multiplex and (1) within nine (9) months following the
termination of this Agreement an Acquisition of Western Multiplex is consummated
or (2) within nine (9) months following the termination of this Agreement
Western Multiplex enters into an agreement providing for an Acquisition of
Western Multiplex and such Acquisition of Western Multiplex is subsequently
consummated and (B) such payment shall be made prior to and as a condition of
the consummation of such Acquisition of Western Multiplex.
(iii) Expense Reimbursement by Proxim. In the event
that this Agreement is terminated by Proxim or Western Multiplex, as applicable,
pursuant to Section 7.1(e) in circumstances in which the Proxim Termination Fee
is not and could not be payable to Western Multiplex pursuant to clause (i)
above, Proxim shall promptly, but in no event later than two (2) days after
receipt of a demand for reimbursement of certain reasonable actual, documented
fees and expenses incurred by Western Multiplex in connection with this
Agreement and the transactions contemplated hereby, reimburse Western Multiplex
for such fees and expenses, up to a maximum of $1,500,000 in immediately
available funds.
(iv) Expense Reimbursement by Western Multiplex. In
the event this Agreement is terminated by Proxim or Western Multiplex, as
applicable, pursuant to Section 7.1(d) in circumstances in which the Western
Multiplex Termination Fee is not and could not be payable to Proxim pursuant to
clause (ii) above, Western Multiplex shall promptly, but in no event later than
two (2) days after receipt of a demand for reimbursement of certain reasonable
actual, documented fees and expenses incurred by Proxim in connection with this
Agreement and the transactions contemplated hereby, reimburse Proxim for such
fees and expenses, up to a maximum of $1,500,000 in immediately available funds.
(v) Interest and Costs; Other Remedies. Each of
Western Multiplex and Proxim acknowledges that the agreements contained in this
Section 7.3(b) are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, the other party hereto would not
enter into this Agreement; accordingly, if Western Multiplex or Proxim, as the
case may be, fails to pay in a timely manner the amounts due pursuant to this
Section 7.3(b), and, in order to obtain such payment, the other party hereto
makes a claim that results in a judgment against the party failing to pay for
the amounts set forth in this Section 7.3(b), the party so failing to pay shall
pay to the other party its reasonable costs and expenses (including reasonable
attorneys' fees and expenses) in connection with such suit, together with
interest on the amounts set forth in this Section 7.3(b) at the prime rate of
Citibank, N.A. in effect on the date such payment was required to be made.
Payment of the fees described in this Section 7.3(b) shall not be in lieu of
damages incurred in the event of breach of this Agreement.
(vi) Certain Definitions. For the purposes of this
Section 7.3(b) only, "ACQUISITION," with respect to a party hereto, shall mean,
other than the transactions contemplated by this Agreement, an Acquisition
Proposal, provided, that for the purpose of this definition, the term
"Acquisition Proposal" shall have the meaning assigned to such term in Section
5.3(h)(i), except that references to "15%" therein shall be deemed to be
references to "40%."
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7.4 Amendment. Subject to applicable law, this Agreement may be amended
by the parties hereto, by action taken or authorized by their respective Boards
of Directors, at any time before or after approval of the matters presented in
connection with the Merger by the stockholders of Western Multiplex and Proxim,
provided, after any such approval, no amendment shall be made which by law or in
accordance with the rules of any relevant stock exchange requires further
approval by such stockholders without such further stockholder approval. This
Agreement may be not amended except by execution of an instrument in writing
signed on behalf of each of Western Multiplex and Proxim.
7.5 Extension; Waiver. At any time prior to the Effective Time either
party hereto, by action taken or authorized by their respective Board of
Directors, 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 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. Delay in exercising any right under this
Agreement shall not constitute a waiver of such right.
ARTICLE VIII
GENERAL PROVISIONS
8.1 Non-Survival of Representations and Warranties. The representations
and warranties of Proxim and Western Multiplex contained in this Agreement, or
any instrument delivered pursuant to this Agreement, shall terminate at the
Effective Time, and only the covenants that by their terms survive the Effective
Time and this Article VIII shall survive the Effective Time.
8.2 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed duly given (i) on the date of delivery if delivered
personally, (ii) on the date of confirmation of receipt (or, the first business
day following such receipt if the date is not a business day) of transmission by
telecopy or telefacsimile or (iii) on the date of confirmation of receipt (or,
the first business day following such receipt if the date is not a business day)
if delivered by a nationally recognized courier service. All notices hereunder
shall be delivered as set forth below, or pursuant to such other instructions as
may be designated in writing by the party to receive such notice:
(a) if to Western Multiplex or Merger Sub, to:
Western Multiplex Corporation
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
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with copies to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
00 Xxxxxxxxx Xxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Fax No.: (000) 000-0000
(b) if to Proxim, to:
Proxim, Inc.
000 XxXxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Day
Fax No.: (000) 000-0000
and
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation
Xxx Xxxxxx
Xxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Fax: (000) 000-0000
8.3 Interpretation; Knowledge.
(a) When a reference is made in this Agreement to Exhibits, such
reference shall be to an Exhibit to this Agreement unless otherwise indicated.
When a reference is made in this Agreement to Sections, such reference shall be
to a section of this Agreement unless otherwise indicated. For purposes of this
Agreement, the words "INCLUDE," "INCLUDES" and "INCLUDING," when used herein,
shall be deemed in each case to be followed by the words "without limitation."
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. When reference is made herein to "THE BUSINESS OF" an entity,
such reference shall be deemed to include the business of all such entity and
its subsidiaries, taken as a whole. An exception or disclosure made in the
Proxim Disclosure Letter with regard to a representation of Proxim, or in the
Western Multiplex Disclosure
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Letter with regard to a representation of Western Multiplex, shall be deemed
made with respect to any other representation by such party to which such
exception or disclosure is reasonably apparent.
(b) For purposes of this Agreement, the term "KNOWLEDGE" means,
with respect to a party hereto, with respect to any matter in question, the
actual knowledge of the Chief Executive Officer, Chief Financial Officer or
Chief Operating Officer of such party.
(c) For purposes of this Agreement, the term "MATERIAL ADVERSE
EFFECT," when used in connection with an entity, means any fact, change, event,
development, circumstance or effect (any such item, an "EFFECT"), individually
or when taken together with all other Effects that have occurred prior to the
date of determination of the occurrence of the Material Adverse Effect, that is
or could reasonably be expected to be materially adverse to the business, assets
(including intangible assets), capitalization, condition (financial or
otherwise) or results of operations of such entity taken as a whole with its
subsidiaries; provided, however, that in no event shall any of the following,
alone or in combination, be deemed to constitute a Material Adverse Effect on
any entity: any Effect resulting from (A) general economic conditions or
conditions generally affecting the wireless telecommunication industry, except
in either case to the extent such party is materially disproportionately
affected thereby, (B) the announcement or pendency of the Merger or (C) a change
in the stock price or trading volume of such entity (or any failure of such
entity to meet published revenue or earnings projections, provided that clause
(C) shall not exclude any underlying Effect which may have caused such change in
stock price or trading volume or failure to meet published revenue or earnings
projections.
(d) For purposes of this Agreement, the term "PERSON" shall mean
any individual, corporation (including any non-profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture,
estate, trust, company (including any limited liability company or joint stock
company), firm or other enterprise, association, organization, entity or
Governmental Entity.
8.4 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 party, it being understood that all
parties need not sign the same counterpart.
8.5 Entire Agreement; Third-Party Beneficiaries. This Agreement and the
documents and instruments and other agreements among the parties hereto as
contemplated by or referred to herein, including the Proxim Disclosure Letter
and the Western Multiplex Disclosure Letter, (i) 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, it being understood that the
Confidentiality Agreement shall continue in full force and effect until the
Closing and shall survive any termination of this Agreement and (ii) are not
intended to confer upon any other Person any rights or remedies hereunder,
except as specifically provided in Section 5.11 following the Effective Time.
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8.6 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 will 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.
8.7 Other Remedies; Specific Performance. Except as otherwise provided
herein, any and all remedies herein expressly conferred upon a party will 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 will not preclude the exercise of any other remedy. The parties hereto
agree that irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to seek an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or in
equity.
8.8 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, regardless of the laws that
might otherwise govern under applicable principles of conflicts of law thereof.
8.9 Rules of Construction. The parties hereto agree that they have been
represented by counsel during the negotiation 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.
8.10 Assignment. No party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other parties. Any purported assignment in violation of this Section 8.10
shall be void. Subject to the preceding sentence, this Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
8.11 Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND
ENFORCEMENT HEREOF.
-67-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized respective officers as of the date first
written above.
WESTERN MULTIPLEX CORPORATION
By: /s/ XXXXXXXX XXXXX
-----------------------------------
Name: Xxxxxxxx Xxxxx
---------------------------------
Title: Chairman & CEO
--------------------------------
PROXIM, INC.
By: /s/ XXXXX X. XXXX
-----------------------------------
Name: Xxxxx X. Xxxx
---------------------------------
Title: Chairman, President & CEO
--------------------------------
WALNUT-PINE MERGER CORP.
By: /s/ XXXXXXXX XXXXX
-----------------------------------
Name: Xxxxxxxx Xxxxx
---------------------------------
Title: Chairman & CEO
--------------------------------
****MERGER AGREEMENT****
