VOTING AGREEMENT
THIS VOTING AGREEMENT (this "AGREEMENT") is entered into as of the 5th day
of October, 2005 by and among Centra Software, Inc., a Delaware corporation (the
"COMPANY"), and the undersigned holders of common stock of Saba Software, Inc.,
a Delaware corporation ("PARENT"), $0.001 par value ("PARENT COMMON STOCK"),
listed on the Schedule of Stockholders attached hereto as SCHEDULE A
(individually referred to herein as a "STOCKHOLDER," and collectively referred
to herein as the "STOCKHOLDERS"). Capitalized terms used but not otherwise
defined herein shall have the meanings given to such terms in the Merger
Agreement (as defined below).
RECITALS
A. Parent, Spruce Acquisition Corporation, a Delaware corporation and a
wholly-owned subsidiary of Parent ("MERGER SUB 1"), Spruce Acquisition, LLC, a
Delaware limited liability company and a wholly-owned subsidiary of Parent
("MERGER SUB 2"), and the Company have concurrently herewith entered into an
Agreement and Plan of Reorganization, dated as of the date hereof (the "MERGER
AGREEMENT"), pursuant to which (i) Merger Sub 1 will merge with and into the
Company, with the Company as the surviving corporation (the "FIRST STEP
MERGER"), and (ii) immediately after the effective time of the First Step
Merger, the Company, as a wholly-owned subsidiary of Parent, will be merged with
and into Merger Sub 2, with Merger Sub 2 as the surviving company (the "SECOND
STEP Merger").
B. In order to induce the Company to enter into the Merger Agreement, the
Company has requested that each of the Stockholders, and each of the
Stockholders has agreed to, enter into this Agreement.
C. Each Stockholder beneficially owns the number of shares of Parent
Common Stock and the options to purchase Parent Common Stock set forth opposite
such Stockholder's name on SCHEDULE A hereto as of the date hereof, and the
Company and each Stockholder wish to bind each Stockholder to vote such number
of shares of Parent Common Stock so owned by such Stockholder as contemplated
herein.
NOW, THEREFORE, in consideration of the promises and the mutual
agreements, provisions and covenants set forth in the Merger Agreement and in
this Agreement, it is hereby agreed as follows:
1. Agreement to Retain Shares.
1.1 AGREEMENT TO RETAIN SHARES. Each Stockholder agrees not to
transfer (except as may be specifically required by court order, by operation of
law or as a distribution to members or partners of such Stockholder (a
"PERMITTED Transferee")), sell, exchange, pledge or otherwise dispose of or
encumber such Stockholder's Shares (as defined below) or deposit any of such
Stockholder's Shares into a voting trust or grant a proxy (except for a Proxy
(as defined below)) or to make or accept any offer or other agreement relating
thereto, at any time prior to the Expiration Date (as defined below), unless the
Permitted Transferee of such Stockholder's Shares agrees in writing to be bound
by the terms hereof. Each Stockholder agrees and consents
to the entry of stop transfer instructions by Parent consistent with the terms
of this Section 1 against the transfer of any of such Stockholder's Shares. As
used herein, the term "EXPIRATION DATE" shall mean the earlier to occur of (i)
the Effective Time (as defined in the Merger Agreement), or (ii) the termination
of the Merger Agreement. As used herein, the term "SHARES" shall mean all issued
and outstanding shares of Parent Common Stock owned of record or beneficially by
Stockholder or over which Stockholder exercises voting power, in each case, as
of the record date for persons entitled (i) to receive notice of, and to vote
at, the meeting of the stockholders of Parent called for the purpose of voting
on matters referred to in section 2.1, or (ii) to take action by written consent
of the stockholders of Parent with respect to the matters referred to in Section
2.1; all other securities of Parent (including all options, warrants and other
rights to acquire shares of Parent Common Stock) beneficially owned by the
Stockholder as of the date of this Agreement; and all additional securities of
Parent (including all additional shares of Parent Common Stock and all
additional options, warrants and other rights to acquire shares of Parent Common
Stock) of which Stockholder acquires ownership during the period from the date
of this Agreement through the earlier of termination of this Agreement pursuant
to Section 6 or the record date for the meeting at which the stockholders of
Parent are asked to vote upon the approval and adoption of the Merger Agreement
and the approval of the First Step Merger. Stockholder agrees that any shares of
capital stock of Parent that Stockholder purchases or with respect to which
Stockholder otherwise acquires beneficial ownership or over which Stockholder
exercises voting power after the execution of this Agreement and prior to the
earlier of termination of this Agreement pursuant to Section 6 or the record
date for the meeting at which the stockholders of Parent are asked to vote upon
the approval and adoption of the Merger Agreement and the approval of the First
Step Merger, shall be subject to the terms and conditions of this Agreement to
the same extent as if they constituted Shares on the date hereof.
2. Voting.
2.1 AGREEMENT TO VOTE SHARES. Each Stockholder hereby agrees to
appear, or cause the holder of record (the "RECORD HOLDER") of any shares of
Parent Common Stock included in such Stockholder's Shares on any applicable
record date to appear, in person or by proxy, for the purpose of obtaining a
quorum at any annual or special meeting of the stockholders of Parent and at any
adjournment thereof and on every action or approval by written consent or
resolution of the stockholders of Parent for the purpose of voting on the Merger
Agreement and the transactions contemplated thereby (a "MEETING"). Prior to the
Expiration Date, at every Meeting, each Stockholder shall vote or cause the
Record Holder to vote, such Shares:
(a) in favor of approval of the First Step Merger and the
Merger Agreement and the transactions contemplated thereby, and any matter that
could reasonably be expected to facilitate the First Step Merger; and
(b) against any action which would, impede, interfere
with, delay, postpone, discourage or adversely affect the consummation of the
First Step Merger or any of the other transactions contemplated by the
Merger Agreement.
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Stockholder further agrees not to enter into any agreement or
understanding with any person the effect of which would be inconsistent with, or
would violate, any provision contained in this Section 2.1.
2.2 OBLIGATIONS AS DIRECTOR AND/OR OFFICER. If at any time prior
to the Expiration Date, a Stockholder (or any affiliate of Stockholder) is a
member of the board of directors of Parent ("DIRECTOR") or an officer of Parent
("Officer"), nothing in this Agreement shall be deemed to limit or restrict such
Stockholder's ability to act or vote in his or her capacity as a Director or
Officer in any manner he or she so chooses, it being agreed and understood that
this Agreement shall apply to such Stockholder solely in his or her capacity as
a stockholder of Parent and shall not apply to his or her actions, judgments or
decisions as a Director or Officer.
3. IRREVOCABLE PROXY. Promptly after the execution of this Agreement,
each Stockholder shall execute and deliver to the Company a duly executed proxy
in a form reasonably acceptable to the Company (a "PROXY") with respect to each
and every Meeting or action or approval by written consent or resolution of the
stockholders of Parent, such Proxy to cover the total number of such
Stockholder's Shares held of record at any such meeting or in connection with
any such written consent which calls for the vote of the stockholders of Parent
to approve the First Step Merger, the Merger Agreement, the transactions
contemplated thereby, or any matter that could reasonably be expected to
facilitate the First Step Merger.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF EACH STOCKHOLDER. Each
Stockholder hereby represents, warrants and covenants to the Company as follows:
4.1 Stockholder is the beneficial owner of the number of Shares
and options to purchase Shares listed opposite his, her or its name on SCHEDULE
A. The number of Shares set forth on SCHEDULE A are the only Shares beneficially
owned by Stockholder and, except as set forth on SCHEDULE A, Stockholder holds
no options to purchase or rights to subscribe for or otherwise acquire any
securities of Parent and has no other interest in or voting rights with respect
to any securities of Parent. As of the date hereof, except as set forth on the
signature page hereto, (i) such Stockholder's Shares are free and clear of any
liens, claims, options, charges or other encumbrances, (ii) none of such
Stockholder's Shares are deposited into a voting trust with voting instructions
inconsistent with any of the provisions of Section 2; and (iii) other than a
Proxy, no proxy is granted, and no voting agreement or similar agreement is
entered into, with respect to any of such Stockholder's Shares that is
inconsistent with any of the provisions of Section 2.
4.2 Stockholder has the legal capacity and absolute and
unrestricted right, power, authority and capacity to execute and deliver this
Agreement and a Proxy, and to perform its obligations hereunder and thereunder.
This Agreement has been (and a Proxy will be) duly executed and delivered by
such Stockholder and constitute legal, valid and binding obligations of such
Stockholder, enforceable against such Stockholder in accordance with their
terms, subject to (i) laws of general application relating to bankruptcy,
insolvency and the relief of debtors, and (ii) rules of law governing specific
performance, injunctive relief and other equitable remedies.
4.3 The execution and delivery of this Agreement and a Proxy by
such Stockholder do and will not, and the performance of this Agreement and a
Proxy by such
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Stockholder will not result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (as defined in
the Merger Agreement) (with or without notice or lapse of time) any right of
termination, amendment, acceleration or cancellation of, or result (with or
without notice or lapse of time) in the creation of any encumbrance or
restriction on any of such Stockholder's Shares pursuant to, any contract to
which such Stockholder is a party or by which such Stockholder or any of his,
her or its affiliates or properties is or may be bound or affected.
4.4 Subject to and without limiting in any respect, Section 2.2,
Stockholder shall not advise or counsel or seek to advise or counsel any Person
to vote against the First Step Merger, any of the other transactions
contemplated by the Merger Agreement, or any matter that could reasonably be
expected to facilitate the First Step Merger.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to each Stockholder as follows:
5.1 The Company has the legal capacity and absolute and
unrestricted right, power, authority and capacity to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement has been duly
authorized by all necessary corporate action on the part of the Company. This
Agreement has been duly executed and delivered by the Company and constitutes a
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to (i) laws of general application
relating to bankruptcy, insolvency and the relief of debtors, and (ii) rules of
law governing specific performance, injunctive relief and other equitable
remedies.
6. TERMINATION. This Agreement shall terminate and shall have no further
force or effect as of the Expiration Date.
7. Miscellaneous.
7.1 SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, then the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
7.2 BINDING EFFECT AND ASSIGNMENT. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but, except as
otherwise specifically provided herein, neither this Agreement nor any of the
rights, interests or obligations of the parties hereto may be assigned by either
of the parties without the prior written consent of the other. This Agreement is
intended to bind each Stockholder as a stockholder of Parent only with respect
to the specific matters set forth herein.
7.3 AMENDMENT AND MODIFICATION. This Agreement may not be
modified, amended, altered or supplemented except by the execution and delivery
of a written agreement executed by the parties hereto.
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7.4 SPECIFIC PERFORMANCE; INJUNCTIVE RELIEF. The parties hereto
acknowledge that the Company will be irreparably harmed and that there will be
no adequate remedy at law for a violation of any of the covenants or agreements
of any Stockholder set forth herein. Therefore, it is agreed that, in addition
to any other remedies that may be available to the Company upon any such
violation, the Company shall have the right to enforce such covenants and
agreements by specific performance, injunctive relief or by any other means
available to the Company at law or in equity and each Stockholder hereby waives
any and all defenses which could exist in its favor in connection with such
enforcement and waives any requirement for the security or posting of any bond
in connection with such enforcement.
7.5 NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or by
commercial delivery service, or mailed by registered or certified mail (return
receipt requested) or sent via facsimile (with confirmation of receipt) to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
(a) If to a Stockholder, at the address set forth below such
Stockholder's signature on the signature page hereto with a copy to:
Xxxxxxxx & Xxxxxxxx LLP
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Attention: Xxxx "Chip" L. Lion III, Esq.
Facsimile: (000) 000-0000
(b) If to the Company:
Centra Software, Inc.
000 Xxxxxxx Xx.
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxx, General Counsel
Facsimile: (000) 000-0000
with a copy to:
Xxxxx Xxxx LLP
000 Xxxxxxx Xxxxxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
or to such other address as any party hereto may designate for itself by notice
given as herein provided.
7.6 GOVERNING LAW. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of Delaware
without reference to such state's principles of conflicts of laws.
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7.7 ENTIRE AGREEMENT. This Agreement and each Proxy contain the
entire understanding of the parties in respect of the subject matter hereof, and
supersede all prior negotiations and understandings between the parties with
respect to such subject matter.
7.8 COUNTERPARTS; DELIVERY BY FACSIMILE. This Agreement may be
executed in several counterparts, each of which shall be an original, but all of
which together shall constitute one and the same agreement. This Agreement may
be delivered by facsimile.
7.9 EFFECT OF HEADINGS. The section headings herein are for
convenience only and shall not affect the construction or interpretation of this
Agreement.
7.10 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations, warranties, covenants and agreements made by each Stockholder
and the Company in this Agreement shall survive until, but terminate at, the
Expiration Date.
7.11 WAIVER OF APPRAISAL RIGHTS. Each Stockholder hereby
irrevocably and unconditionally waives, and agrees to cause to be waived and to
prevent the exercise of, any rights of appraisal, any dissenters' rights and any
similar rights relating to the First Step Merger or any related transaction that
each such Stockholder or any other Person may have by virtue of the ownership of
any Shares.
7.12 NON-EXCLUSIVITY. The rights and remedies of the Company or
any Stockholder under this Agreement are not exclusive of or limited by any
other rights or remedies which either the Company or any Stockholder may have,
whether at law, in equity, by contract or otherwise, all of which shall be
cumulative (and not alternative). Without limiting the generality of the
foregoing, the rights and remedies of the Company and each Stockholder under
this Agreement, and the obligations and liabilities of the Company and each
Stockholder under this Agreement, are in addition to their respective rights,
remedies, obligations and liabilities under common law requirements and under
all applicable statutes, rules and regulations. Nothing in this Agreement shall
limit the Company's obligations or any Stockholder's obligations, or the rights
or remedies of the Company or any Stockholder, under any agreement between the
Company and any Stockholder, and nothing in any such agreement shall limit any
of the Company's or any Stockholder's obligations, or any of the rights or
remedies of the Company or any Stockholder, under this Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date first above written.
COMPANY
CENTRA SOFTWARE, INC.
By:
-------------------------
Name:
-----------------------
Title:
----------------------
Signature Page to Parent Stockholder Voting Agreement
STOCKHOLDER
[NAME]
------------------------------
(Signature)
------------------------------
(Print Name)
------------------------------
(Print Address)
------------------------------
(Print Address)
------------------------------
(Print Telephone Number)
------------------------------
(Print Facsimile Number)
------------------------------
(Social Security or Tax I.D. Number)
NUMBER OF SHARES OF PARENT BENEFICIALLY OWNED BY STOCKHOLDER ON THE DATE OF THIS
AGREEMENT:
Common Stock: _________ shares of Parent Common Stock
Stock Options: _________
pa-1008539
SCHEDULE A
SCHEDULE OF STOCKHOLDERS
NAME OF STOCKHOLDER SHARES OF COMMON STOCK STOCK OPTIONS
Xxxxx Xxxxxxx 1,586,697 215,000
Pequot Private Equity Fund III, L.P. 2,344,063 0
Pequot Offshore Private Equity
Partners III, L.P. 330,437 0
Sequoia Capital IX 217,180 0
Sequoia Capital IX Principals Fund 40,087 0
Sequoia Capital Entrepreneurs Annex Fund 33,430 0
Sequoia Capital Franchise Fund 767,441 0
Sequoia Capital Franchise Partners 104,651 0
