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EXHIBIT 10.7
VOTING AGREEMENT
This Voting Agreement (the "Agreement") is entered into as of
December 19, 1996 by and among Objective Communications, Inc., a Delaware
corporation (the "Company"), Xxxxxx X. Xxxxxx (the "Holder"), Applewood
Associates, L.P. ("Applewood") and Acorn Technology Partners, L.P. ("Acorn,"
and, together with Applewood, the "Investors").
R E C I T A L S
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Investors are purchasing shares of Series A Convertible
Preferred Stock (the "Series A Preferred Stock") and warrants (the "Warrants")
of the Company pursuant to that certain Series A Convertible Preferred Stock
and Warrant Purchase Agreement of even date herewith (the "Stock Purchase
Agreement"); and
WHEREAS, the Company and the Investors wish to enter into an
agreement whereby, among other things, the Investors would be entitled to
designate one (1) person to be elected as a member of the Company's Board of
Directors;
WHEREAS, in order to induce the Investors to consummate their
purchases of the Series A Preferred Stock and the Warrants pursuant to the
Stock Purchase Agreement, the Company, the Holder and the Investors agree to
enter into and be bound by this Agreement;
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants set forth below, the parties hereto agree as follows:
1. Election of Director.
(a) For so long as the Investors hold in the aggregate at least
five percent (5%) of the outstanding voting securities of the Company (on a
fully diluted, as converted basis), the Investors shall be entitled to nominate
one (1) person for election to the Company's Boar of Directors (it being agreed
Among the Investors that for so long as Applewood shall hold any shares of
Series A Preferred Stock, such person to be nominated for election shall be
selected by Applewood).
(b) The Holder will, during the term of this Agreement:
(i) vote(or cause to be voted) all shares of capital stock
of the Company then held by him so as always to elect as a director the nominee
designated by the Investors and vote in opposition to any attempt to remove
such director without the consent of the Investors unless (x) such removal is
for cause and (y) the vacancy caused thereby is immediately filled, in
accordance with Section 1(a) above at any annual or special meeting called for
such purpose; in the event of any vacancy on the Board of Directors as a result
of the resignation or removal of a director originally nominated by the
Investors, the Holder will vote
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all such shares to fill such vacancy with a nominee designated in the same
manner as the person who held the directorship so vacated; and
(ii) vote(or cause to be voted) all such shares of stock
necessary to cause the total number of authorized directors of the Company to
be not less than three (3).
(iii) The Investors will, during the term of this
Agreement, vote (or cause to be voted) all such shares of stock necessary to
cause the total number of authorized directors of the Company to be not less
than three (3).
2. Authorization of Additional Shares.
The Holder will vote (or cause to be voted) all shares of capital
stock of the Company then held by him so as to authorize the issuance of any
additional securities required for the conversion or exercise of all or any
portion of the Series A Preferred Stock and the Warrants.
3. Other Matters.
This Agreement shall not extend to voting upon questions and
matters (other than the election of directors and the authorization of
additional shares) upon which stockholders of the Company have a right to vote
under the Charter or Bylaws of the Company or under the laws of the State of
Delaware.
4. Representative at Board of Director Meetings.
In addition to such person as the Investors are entitled to
nominate for election to the Company's Board of Directors as provided herein,
for so long as the Investors hold in the aggregate at least five percent (5%)
of the outstanding voting securities of the Company (on a fully diluted, as
converted basis) the holders of a majority in interest of all shares of capital
stock of the Company then held by the Investors may also designate one (1)
representative to receive notice of and attend all meetings of the Board of
Directors of the Company and such representative shall be permitted to attend
and observe all such meetings (it being agreed among the investors that for so
long as Applewood shall hold any shares of Series A Preferred Stock such
representative to be designated shall be selected by Applewood).
5. Reimbursement of Expenses.
The Company shall reimburse the reasonable out-of-pocket expenses
(including, without limitation, travel expenses) of (i) any director nominated
by the Investors pursuant to Section 1 hereof and (ii) any representative
designated by the Investors pursuant to Section 4 hereof, related to attending
meetings of the Board of Directors of the Company.
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6. Voting Proxy.
(a) Acorn hereby appoints Applewood as Proxy with full power of
substitution and resubstitution and grants to such Proxy all rights and powers
to vote all shares of Series A Preferred Stock of record in the name of or held
for the benefit of Acorn at any time and from time to time. The Proxy and grant
of such authority shall include the right and power to vote the Stock on any
and all matters as to which the Investors shall have the right to vote under
this Agreement at any regular or special meeting of stockholders or otherwise,
and the right and power to give written or verbal consents with respect to any
corporate action and to waive notice of or attendance at any meeting.
(b) This Proxy is irrevocable (subject to the limitations set
forth in the next paragraph) and grants to Applewood all rights and powers to
vote the above referenced shares in any manner, in Applewood's sole discretion,
that Applewood believes is appropriate, without regard to the interests of any
other person or entity.
(c) This Proxy shall terminate with respect to any and all matters
upon the first to occur of (i) six (6) months from the date of execution of
this Agreement and (ii) the completion of the currently contemplated initial
public offering of Common Stock by the Company for not less than $5.00 in an
underwriting with Barington Capital Group, L.P. as the lead underwriter (the
"Barington Offering") ; provided, however, that notwithstanding the foregoing,
the Proxy with respect to the nomination and election of a director as set
forth in Section 1 hereof shall not terminate prior to the termination of this
Agreement.
7. Termination.
This Agreement shall terminate and be of no further force or
effect upon the first to occur of (i) the tenth anniversary of this Agreement,
(ii) the completion of the Barington Offering or (iii) the consummation of the
Company's issuance and sale of its Common Stock in a bona fide, firm commitment
underwriting pursuant to a registration statement under the Securities Act of
1933, as amended, covering the offer and sale of the Company's Common Stock to
the general public (a "Qualified Public Offering") which shall result in gross
proceeds to the Company of at least $10,000,000 in the aggregate and be at a
price per share to the public which is not less than 150% of the then effective
"Series A Conversion Price" as defined in the Charter (all as appropriately
adjusted to reflect subsequent stock issuances, stock splits, stock dividends,
mergers, combinations, reclassifications, reorganizations, recapitalizations
and similar events), provided further, however, that in the event no shares of
Series A Preferred Stock are outstanding, no per share price limitation shall
apply.
8. Entire Agreement; Modifications and Amendments.
(a) This Agreement constitutes the entire agreement of the parties
with respect to the subject matter hereof and may not be modified, amended or
terminated (other than in
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accordance with its terms) except by a written agreement specifically referring
to this Agreement and signed by (i) the Company, (ii) the Investors and (iii)
the Holder.
(b) To the extent any term or other provision of any other
indenture, agreement, instrument or oral understanding by which any party
hereto is bound conflicts with this Agreement, this Agreement shall have
precedence over such conflicting term or provision.
9. Waivers.
No waiver of any breach or default hereunder shall be considered
valid unless in writing and signed by the party granting such waiver, and no
such waiver shall be deemed a waiver of any subsequent breach or default of the
same or similar nature.
10. Successors and Assigns; Assignability of Rights.
This Agreement shall be binding upon and inure to the benefit of
each party hereto, its successors and permitted assigns. Otherwise, this
agreement shall not confer any rights, remedies, obligations or liabilities
upon any third party. The rights granted to the investors herein shall be
assignable only to an assignee or transferee who, as a result of such
assignment, holds, in the aggregate, at least ten percent (10%) of the
aggregate of the then outstanding shares of Series A Preferred Stock.
11. Legends.
Each certificate issued after the date hereof evidencing
securities subject to the provisions of this Agreement (including any shares
issued upon a transfer, stock split, stock dividend, recapitalization, merger
or other similar event) shall at all times during the term of this Agreement
bear the following legend:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE
SUBJECT TO THE PROVISIONS OF A VOTING
AGREEMENT DATED AS OF DECEMBER 19, 1996. BY
ACCEPTING ANY INTEREST IN SUCH SECURITIES THE
PERSON ACCEPTING THE INTEREST SHALL BE DEEMED
TO AGREE TO AND SHALL BECOME BOUND BY ALL THE
PROVISIONS OF SAID VOTING AGREEMENT. THE
CORPORATION WILL FURNISH A COPY OF SUCH
AGREEMENT TO THE HOLDER OF THIS CERTIFICATE
UPON REQUEST AND WITHOUT CHARGE.
12. Headings.
The section and subsection headings contained herein are for
convenience only and are not intended to define or limit the contents of said
sections or subsections.
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13. Cooperation.
Each party hereto shall take such further action and shall execute
and deliver such further documents as may be reasonably requested by any other
party in order to carry out the provisions and purposes of this Agreement.
14. Counterparts.
This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.
15. Governing Law.
This Agreement and all amendments hereof shall be governed by and
construed in accordance with the laws of the State of New York, disregarding
any New York principles of choice or conflict of laws that would otherwise
provide for the application of the substantive laws of another jurisdiction.
16. Specific Performance.
Without limiting the rights of each party hereto to pursue all
other legal and equitable rights and remedies available to such party for any
other party's failure to perform its obligations under this Agreement, each
such party acknowledges and agrees that the remedy at law for any failure to
perform obligations hereunder would be inadequate and all such parties shall be
entitled to specific performance, injunctive relief or other equitable remedies
in the event of any such failure.
17. Severability
If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall
attach only to such provision and shall not in any manner affect or render
illegal, invalid or unenforceable any other provision of this Agreement, and
this Agreement shall be carried out as if any such illegal, invalid or
unenforceable provision were not contained herein.
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IN WITNESS WHEREOF, the parties hereto have caused this Voting
Agreement to be duly executed as of the day and year first above written.
COMPANY:
OBJECTIVE COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President and CEO
Address: 00000 Xxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
HOLDER:
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Address:
INVESTORS:
APPLEWOOD ASSOCIATES, L.P.
By: APPLEWOOD CAPITAL CORP.,
its General Partner
By:
----------------------------------
Name: Xxxxx Xxxxxxxxxx
Title:
Address: c/o Xxxxxxx Xxxxxx
00 Xxxxxxxxxx Xxxx
Xxxxx 000
Xxxxx Xxxx, Xxx Xxxx 00000
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IN WITNESS WHEREOF, the parties hereto have caused this Voting
Agreement to be duly executed as of the day and year first above written.
COMPANY:
OBJECTIVE COMMUNICATIONS, INC.
By:
---------------------------
Name:
Title:
Address: 00000 Xxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
HOLDER:
By:
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Xxxxxx X. Xxxxxx
Address:
INVESTORS:
APPLEWOOD ASSOCIATES, L.P.
By: XXXXX XXXXXXXXXX,
a General Partner
By: /s/ Xxxxx Xxxxxxxxxx
--------------------------
Xxxxx Xxxxxxxxxx
Address: c/o Xxxxx Xxxxxxxxxx
00 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxx 00000
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ACORN TECHNOLOGY PARTNERS, L.P.
By: PRINCETON GROWTH INVESTMENTS I,
L.L.C., its General Partner
By: /s/ Xxxx X. Xxxxxxxxx
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Name: Xxxx X. Xxxxxxxxx
Title: President and Manager
Address: c/o Chadian Services, Limited
Clarendon House
0 Xxxxxx Xxxxxx
Xxxxxxxx, XX XX, Xxxxxxx
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