CAPROCK OWNERS AGREEMENT
AGREEMENT, dated February ___, 1998 (this "Agreement"), is entered into by
and among IWL Communications, Incorporated, a Texas corporation ("IWL"), CapRock
Systems, Inc., the general partner (the "General Partner") of CapRock Fiber
Network, Ltd., a Texas limited partnership (the "Partnership"), and each of the
other parties signatory hereto, each of whom is a shareholder in CapRock
Communications Corp., a Texas corporation ("CapRock"), and/or a limited partner
(or will become a limited partner) in the Partnership (including the General
Partner, each an "Owner" and, collectively, the "Owners").
WITNESSETH:
WHEREAS, concurrently herewith, CapRock, the Partnership, IWL, IWL Holdings
Corp., a Texas corporation and a direct wholly-owned subsidiary of IWL
("Holdings"), IWL Acquisition Corp., a Texas corporation and a wholly-owned
subsidiary of Holdings ("I-Sub"), and CapRock Acquisition Corp., a Texas
corporation and a wholly-owned subsidiary of Holdings ("C-Sub"), are entering
into an Agreement and Plan of Merger and Plan of Exchange (as such agreement may
hereafter be amended from time to time, the "Merger Agreement"; capitalized
terms used and not defined herein have the respective meanings ascribed to them
in the Merger Agreement) pursuant to which, among other things, I-Sub will be
merged with and into IWL (the "Company Merger"), C-Sub will be merged with and
into CapRock (the "CapRock Merger" and, together with the Company Merger, the
"Mergers"), and all of the issued and outstanding partnership interests in the
Partnership will be exchanged for shares of Holdings Common Stock (the "Interest
Exchange");
WHEREAS, each of the Owners Beneficially Owns (as defined herein) or will
Beneficially Own the number of shares of common stock, par value $0.01 per
share, of CapRock (the "Shares" or "Company Common Stock") and the percentage
limited partnership interest in the Partnership (the "Interests"), in each case
as set forth opposite such Owner's name on Schedule I hereto;
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, IWL has required that the Owners agree, and the Owners have agreed,
to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual premises,
representations, warranties, covenants and agreements contained herein, the
parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING CAPROCK COMMON STOCK AND THE INTERESTS. Each
Owner hereby agrees that during the period commencing on the date hereof and
continuing until the first to occur of the Effective Time and the termination
of the Merger Agreement in accordance with its terms, at any meeting of the
holders of CapRock Common Stock or of the holders of Interests, however
called, or in connection with any written consent of the holders of CapRock
Common Stock or of the holders of Interests, such Owner shall vote (or cause
to be voted) the Shares and/or Interests Beneficially Owned by such Owner,
whether heretofore owned or hereafter acquired (and, if applicable, shall
grant any required consents under the limited partnership agreement of the
Partnership), (i) in favor of approval of the CapRock Merger and the Interest
Exchange, in each case on the terms and subject to the conditions set forth in
the Merger Agreement, the Merger Agreement, and any actions required in
furtherance thereof and hereof, including without limitation the issuance of
shares of Holding Common Stock in connection with the Mergers; (ii) against
any action or
agreement that would result in a breach in any respect of any covenant,
representation or warranty or any other obligation or agreement of CapRock or
the Partnership under the Merger Agreement (after giving effect to any
materiality or similar qualifications contained therein) and (iii) except to
the extent the action is not prohibited to be taken by CapRock or the
Partnership under the Merger Agreement or as otherwise agreed to in writing in
advance by IWL against any action which is intended, or could reasonably be
expected, to impede, interfere with, materially delay or postpone, or
materially adversely affect the CapRock Merger, the Interest Exchange and the
transactions contemplated by this Agreement and the Merger Agreement. Such
Owner shall not enter into any agreement or understanding with any Person (as
defined below) the effect of which would be inconsistent with, or which would
violate, the provisions and agreements contained in Section 1 or 2 hereof.
For purposes of this Agreement, "Beneficially Own" or "Beneficial Ownership"
or any derivation thereof with respect to any securities shall mean having or
being a Person who has "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act")), including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities Beneficially
Owned by a Person shall include securities Beneficially Owned by all other
Persons with whom such Person would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. For purposes of this Agreement,
"Person" shall mean an individual, corporation, limited liability company,
partnership, joint venture, association, trust, unincorporated organization or
other entity.
2. REPRESENTATIONS AND WARRANTIES. Each Owner hereby represents and
warrants to IWL as follows:
(a) OWNERSHIP OF SHARES AND INTERESTS. Such Owner is (or will, prior to
the Effective Time (as defined in the Merger Agreement), be) the Beneficial
Owner of the number of Shares and/or the percentage Interest, as applicable,
set forth opposite such Owner's name on Schedule I hereto free and clear of
all liens, claims and encumbrances, and on the date hereof, such Shares and/or
Interests constitute all of the Shares and/or Interests Beneficially Owned by
such Owners. Such Owner has sole voting power and sole power to issue
instructions with respect to the matters set forth in Section 1 hereof, sole
power of disposition, sole power of conversion, sole power to demand appraisal
rights and sole power to agree to all of the matters set forth in this
Agreement, in each case with respect to all of the Shares and/or Interests set
forth opposite such Owner's name on Schedule I hereto, with no limitation,
qualification or restriction on such rights or agreement to exercise those
rights in a certain manner or as directed by any other Person, except as
indicated on Schedule I.
(b) POWER; BINDING AGREEMENT. Such Owner has the legal capacity, power
and authority to enter into and perform all of such Owner's obligations under
this Agreement. The execution, delivery and performance of this Agreement by
such Owner will not violate any other agreement to which such Owner is a party
including, without limitation, any partnership agreement, voting agreement,
shareholder agreement or voting trust. This Agreement has been duly and
validly executed and delivered by such Owner and constitutes a valid and
binding agreement of such Owner, enforceable against such Owner in accordance
with its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability, to general
principles of equity. There is no beneficiary or holder of a voting trust
certificate or other interest of any trust of which such
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Owner is Trustee whose consent is required for the execution and delivery of
this Agreement or the consummation by such Owner of the transactions
contemplated hereby. If such Owner is married and such Owner's Shares and/or
Interests constitute community property, this Agreement has been duly
authorized, executed and delivered by, and constitutes a valid and binding
agreement of, such Owner's spouse, enforceable against such person in
accordance with its terms.
(c) NO CONFLICTS. (A) No filing with, and no permit, authorization,
consent or approval of, any state or federal public body or authority is
necessary for the execution of this Agreement by such Owner and the
consummation by such Owner of the transactions contemplated hereby and (B)
none of the execution and delivery of this Agreement by such Owner, the
consummation by such Owner of the transactions contemplated hereby or
compliance by such Owner with any of the provisions hereof will (1) result in
a violation or breach of, or constitute (with or without notice or lapse of
time or both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, commitment, arrangement, understanding, agreement or other
instrument or obligation of any kind to which such Owner is a party or by
which such Owner or any of such Owner's properties or assets may be bound, or
(2) violate any order, writ, injunction, decree, judgment, order, statute,
rule or regulation applicable to such Owner or any of such Owner's properties
or assets.
(d) RELIANCE BY IWL. Such Owner understands and acknowledges that IWL
is entering into the Merger Agreement in reliance upon such Owner's execution
and delivery of this Agreement.
3. RESTRICTION ON TRANSFER AND PROXIES.
(a) Each Owner hereby agrees that during the period commencing thirty
days prior to the Effective Time and continuing until the first to occur of
the Effective Time and the termination of the Merger Agreement in accordance
with its terms, such Owner shall not, directly or indirectly, except as
contemplated by the Merger Agreement, offer for sale, sell, transfer, tender,
pledge, encumber, assign or otherwise dispose of, or enter into any contract,
option or other arrangement or understanding with respect to or consent to the
offer for sale, sale, transfer, tender, pledge, encumbrance, assignment or
other disposition of (collectively, "Transfer"), any or all of such Owner's
Shares and/or Interests or, in either case, any interest therein. In
addition, each Owner hereby agrees that during the period commencing on the
date hereof and continuing until the first to occur of the Effective Time and
the termination of the Merger Agreement in accordance with its terms, such
Owner shall not, directly or indirectly: (i) grant any proxy or power of
attorney, deposit any Shares or Interests into a voting trust or enter into a
voting agreement with respect to any Shares or Interests or otherwise agree to
vote any of the Shares or Interests in a manner other than as set forth
herein; or (ii) take any action that would make any representation or warranty
of such Owner contained herein untrue or incorrect or have the effect of
preventing or disabling such Owner from performing such Owner's obligations
under this Agreement.
(b) Notwithstanding the provisions of paragraph (a)(i) above, a Transfer
shall not include (A) with respect to any Owner, a Transfer of Shares to any
other Owner who owns Shares or a Transfer of Interests to any other Owner who
holds Interests, (B) with respect to any Owner that is an individual, a
Transfer to (1) a sibling, ancestor or descendant, spouse of any of the
foregoing,
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spouse of such Owner, or descendants of any of the foregoing or (2) any trust
or family partnership for the primary benefit of such Owner or any Persons
described in clause (1); or (C) with respect to any Owner that is a trust or
family partnership, the beneficiaries or partners of the trust or family
partnership or another trust or family partnership established for the primary
benefit of such beneficiaries or partners; provided, however, that any
Transfer under this Section 3(b)(B) or (C) shall be void unless the transferee
executes a copy of this Agreement.
4. FURTHER ASSURANCES. From time to time, at the other party's
reasonable request and without further consideration, each party hereto shall
execute and deliver such additional documents and take all such further lawful
action as may be necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions contemplated by this
Agreement.
5. RESTRICTIVE LEGEND. Upon the request of IWL, the certificates
representing any of such Shareholder's Shares shall be stamped with the
following legend:
"The securities represented by this certificate, including
certain voting rights with respect thereto, are subject to
the terms of an Owners Agreement, dated February __, 1998,
among IWL Communications, Incorporated, CapRock Systems,
Inc., and the other parties listed on the signature pages
thereto, a copy of which is on file in the principal office
of the Issuer."
6. TERMINATION. Except as otherwise provided herein, the covenants and
agreements contained herein with respect to the Shares and the Interests shall
terminate upon the earlier of (a) the termination of the Merger Agreement in
accordance with its terms and (b) the Effective Time.
7. SHAREHOLDER CAPACITY. No person executing this Agreement who is or
becomes during the term hereof a director of CapRock makes any agreement or
understanding herein in his or her capacity as such director. Each Owner
signs solely in his or her capacity as the record and/or Beneficial Owner of
such Shareholder's Shares and/or Interests.
8. CONFIDENTIALITY. The Owners recognize that successful consummation
of the transactions contemplated by this Agreement may be dependent upon
confidentiality with respect to the matters referred to herein. In this
connection, pending public disclosure thereof, each Owner hereby agrees not to
disclose or discuss such matters with anyone not a party to this Agreement
(other than such Owner's counsel and advisors, if any) without the prior
written consent of IWL, except for disclosures such Owner's counsel advises
are necessary in order to fulfill such Owner's obligations imposed by law, in
which event such Owner shall give notice of such disclosure to IWL, as
promptly as practicable so as to enable IWL to seek a protective order from a
court of competent jurisdiction with respect thereto.
9. AUTHORITY RELATIVE TO THIS AGREEMENT. IWL has the necessary
corporate power and authority to enter into this Agreement and to carry out
its obligations hereunder. The execution and delivery of this Agreement by
IWL and the consummation by IWL of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on the part of IWL.
This
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Agreement has been duly executed and delivered by IWL and, assuming the due
authorization, execution and delivery thereof by the other parties hereto,
constitutes a legal, valid and binding obligation of IWL, enforceable against
it in accordance with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability,
to general principles of equity.
10. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement and the Merger Agreement
constitute the entire agreement between the parties with respect to the
subject matter hereof and supersede all other prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof. At the Effective Time, any shareholders agreements
among any of the parties hereto, including that certain Stockholders
Agreement, dated as of January 13, 1992, shall terminate and be of no further
force or effect. However, in the event the Effective Time does not occur,
then all of such shareholders agreements shall remain in full force and effect
in accordance with their respective terms and shall not be changed or modified
in any respect by this Agreement.
(b) CERTAIN EVENTS. Each Owner agrees that this Agreement and the
obligations hereunder shall attach to such Owner's Shares and/or Interests and
shall be binding upon any person or entity to which legal or beneficial
ownership of such Shares and/or Interests shall pass, whether by operation of
law or otherwise, including, without limitation, such Owner's heirs,
guardians, administrators or successors. Notwithstanding any transfer of
Shares and/or Interests, the transferor shall remain liable for the
performance of all obligations under this Agreement of the transferor.
(c) ASSIGNMENT. This Agreement shall not be assigned by operation of
law or otherwise without the prior written consent of the other parties hereto.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be amended,
changed, supplemented, waived or otherwise modified or terminated, with
respect to any one or more Owners, except upon the execution and delivery of a
written agreement executed by the relevant parties hereto.
(3) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegrams
telex or telecopy, or by mail (registered or certified mail, postage prepaid,
return receipt requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall be delivered
to the respective parties at the following addresses:
If to any Owner: At the addresses set forth
on Schedule I hereto
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with a copy to: Xxxxxx & Xxxx, L.L.P.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
If to IWL: IWL Communications, Incorporated
00000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxxx
with a copy to: Xxxxxx Xxxxx Xxxx Xxxx & Xxxxx, P.C.
0000 Xxxx Xxxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: A. Xxxxxxx Xxxxxxxxxxxx, Esq. and
Xxxx X. Xxxxxxxxxxx, Esq.
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(f) SEVERABILITY. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of
any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or portion of any prevision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision
had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it
would not have an adequate remedy at law for money damages, and therefore each
of the parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) REMEDIES CUMULATIVE. All rights, powers and remedies provided under
this Agreement or otherwise available in respect hereof at law or in equity
shall be cumulative and not
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alternative, and the exercise of any thereof by any party shall not preclude
the simultaneous or later exercise of any other such right, power or remedy by
such party.
(i) NO WAIVER. The failure of any party hereto to exercise any right,
power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by
such party of its right to exercise any such or other right, power or remedy
or to demand such compliance.
(j) NO THIRD PARTY BENEFICIARIES. This Agreement is not intended to be
for the benefit of, and shall not be enforceable by, any person or entity who
or which is not a party hereto.
(k) GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Texas, without giving effect to the
principles of conflicts of law thereof.
(l) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO
A TRIAL BY JURY IN CONNECTION WITH ANY SUCH ACTION, SUIT OR PROCEEDING.
(m) DESCRIPTIVE HEADINGS. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning or interpretation of this Agreement.
(n) COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original, but all of which, taken together,
shall constitute one and the same Agreement. In addition, notwithstanding
nothing to the contrary contained herein, this Agreement shall become
effective and binding upon all signatories hereto at the time counterpart
signature pages have been executed by IWL, the General Partner and Owners who
own at least a majority of the issued and outstanding Shares of CapRock as of
the date hereof (and so long as such majority of Owners sign this Agreement,
the failure of one or more other Owners to sign this Agreement shall not
affect its effectiveness, and this Agreement shall still be binding upon those
Owners and other parties who do sign this Agreement, including any Owners who
sign this Agreement after the date hereof).
(o) WAIVER OF PREEMPTIVE RIGHTS. Each Owner who currently Beneficially
Owns, or at any time since the incorporation of CapRock has ever Beneficially
Owned, any shares of Company Common Stock hereby waives any preemptive rights
such Owner had or may have had with respect to any and all issuances at any
time since the incorporaton of CapRock of shares of Company Common Stock, and
hereby releases and discharges any claims against CapRock or IWL (or their
respective successors) and any other Owners arising therefrom.
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IN WITNESS WHEREOF, IWL, the General Partner, and each other Owner have
caused this Agreement to be duly executed as of the day and year first above
written.
IWL COMMUNICATIONS, INCORPORATED
By:
---------------------------------
Name:
--------------------------
Title:
-------------------------
CAPROCK SYSTEMS, INC.
By:
---------------------------------
Name:
--------------------------
Title:
-------------------------
------------------------------------
Xxxx X. Xxxxxxxx, Xx.
------------------------------------
Spouse
------------------------------------
Xxxx X. Xxxxxxxx, Xx.
------------------------------------
Spouse
------------------------------------
Xxxx Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxx Xxxxxxx
------------------------------------
Spouse
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------------------------------------
Xxx Xxxxxx
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Spouse
------------------------------------
Xxx Xxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxxxx X. Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxxxx X. Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxxxxx X. Xxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxxxxx X. Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxxxxxxxx X. Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxxxx X. Xxxxxxxx
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------------------------------------
Spouse
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Xxx X. Xxxxxxxx, Xx.
------------------------------------
Spouse
------------------------------------
Xxxxxxxx Xxxxxxxx
------------------------------------
Spouse
------------------------------------
Xxx X. Xxxxx
------------------------------------
Spouse
THE FLORIDA COMPANY
By:
---------------------------------
Name:
--------------------------
Title:
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THE HAYDEN COMPANY
By:
---------------------------------
Name:
--------------------------
Title:
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CAPROCK INVESTORS
By:
---------------------------------
Name:
--------------------------
Title:
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THE WILLIAMSBURG CORPORATION
By:
---------------------------------
Name:
--------------------------
Title:
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SCHEDULE I TO
OWNERS AGREEMENT
Number of Shares
Name and Address Beneficially Percentage Interests
of Owner Owned Beneficially Owned
---------------- ---------------- ---------------------
CapRock Systems, Inc. -- 1.72375% general partner interest
Xxxxx Xxxxxxx 1,611,834 --
Xxx Xxxxxx 1,611,834 --
Xxx Xxxxxxx 1,611,834 --
CapRock Investors 4,835,527 --
The Williamsburg Corporation 727,925 --
Xxxxxxx X. Xxxxxxxx 1.14597% limited partner interest
Xxxxxxx X. Xxxxxxxx 1.14597% limited partner interest
Xxxxxxxx X. Xxxxxx 1.14597% limited partner interest
Xxxxxxxx X. Xxxxxxxx 1.14597% limited partner interest
Xxxxxxxxxxx X. Xxxxxxxx 1.14597% limited partner interest
Xxxxx X. Xxxxxxxx 1.14597% limited partner interest
The Florida Company 1.97246% limited partner interest
Xxx X. Xxxxxxxx, Xx. 1.97246% limited partner interest
The Hayden Company 3.94493% limited partner interest
Xxxxxxxx Xxxxxxxx 4.58389% limited partner interest
Xxxx X. Xxxxxxxx, Xx. 6.55635% limited partner interest
Xxxx Xxxxxxxx 38.99919% limited partner interest
Xxxx X. Xxxxxxxx, Xx. 31.87113% limited partner interest
Xxx X. Xxxxx (1) 1.50000% limited partner interest
c/o: CapRock Communications Corp.
Two Galleria Tower, Suite 1925
00000 Xxxx Xxxx
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Xx.
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(1) On or prior to the execution of this Agreement, Xxx X. Xxxxx will
receive an aggregate of a 1.50% limited partner interest in the Partnership pro
rata from each of the existing partners pursuant to an existing subscription
agreement between Xx. Xxxxx and the Company.
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