STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT, dated as of June 14, 1999 (the
"Agreement"), among Cadence Design Systems, Inc., a Delaware corporation
("Parent"), CDSI Acquisition Corporation, a Delaware corporation and a wholly
owned subsidiary of Parent ("Purchaser"), and the stockholders of OrCAD, Inc., a
Delaware corporation (the "Company"), whose names appear on Schedule I hereto
(collectively, the "Stockholders"). Terms which are capitalized herein, and
which are defined in the Merger Agreement, shall have the meanings therein set
forth.
W I T N E S S E T H:
WHEREAS, contemporaneously with the execution and delivery of
this Agreement, Parent, Purchaser and the Company are entering into an Agreement
and Plan of Merger, dated as of the date hereof (the "Merger Agreement"), which
provides for, upon the terms and subject to the conditions set forth therein,
(i) the commencement by Purchaser of a tender offer (the "Offer") for all of the
issued and outstanding shares of common stock, par value $.01 per share, of the
Company (the "Shares"), at a price of $13.00 per share, net to the seller in
cash, and (ii) the subsequent merger of Purchaser with and into the Company (the
"Merger");
WHEREAS, as of the date hereof, each Stockholder owns
(beneficially and of record) the number of Shares set forth opposite such
Stockholder's name on Schedule I hereto (all Shares so owned and which may
hereafter be acquired by such Stockholder prior to the termination of this
Agreement, whether upon the exercise of options or by means of purchase,
dividend, distribution or otherwise, being referred to herein as such
Stockholder's "Owned Shares");
WHEREAS, as a condition to their willingness to enter into the
Merger Agreement, Parent and Purchaser have required that the Stockholders enter
into this Agreement; and
WHEREAS, in order to induce Parent and Purchaser to enter into
the Merger Agreement, the Stockholders are willing to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained, and intending to be legally
bound hereby, Parent, Purchaser and each of the Stockholders, severally and not
jointly, hereby agree as follows:
ARTICLE I.
TRANSFER AND VOTING OF SHARES;
AND OTHER COVENANTS OF THE STOCKHOLDERS
SECTION 1.1. VOTING OF SHARES. From the date hereof until the
earliest to occur of (x) termination of this Agreement pursuant to Section 6.2
hereof, (y) the expiration of the Stock Option with respect to such
Stockholder's Owned Shares and (z) the closing of any exercise of such Stock
Option (the "Term"), at any meeting of the stockholders of the Company, however
called, and in any action by consent of the stockholders of the Company, each
Stockholder shall vote its Owned Shares (i) in favor of the Merger and the
Merger Agreement (as amended from time to time), (ii) against any proposal for a
Third Party Acquisition and against any proposal for action or agreement that
would result in a breach of any covenant, representation or warranty or any
other obligation or agreement of the Company under the Merger Agreement or which
is reasonably likely to result in any of the conditions of the Company's
obligations under the Merger Agreement not being fulfilled, any change in the
directors of the Company, any change in the present capitalization of the
Company or any amendment to the Company's Restated Certificate of Incorporation
or By-Laws, any other material change in the Company's corporate structure or
business, or any other action which could reasonably be expected to impede,
interfere with, delay, postpone or materially adversely affect the transactions
contemplated by the Merger Agreement or the likelihood of such transactions
being consummated and (iii) in favor of any other matter necessary for
consummation of the transactions contemplated by the Merger Agreement which is
considered at any such meeting of stockholders and in connection therewith to
execute any documents which are necessary or appropriate in order to effectuate
the foregoing, including the ability for Purchaser or its nominees to vote such
Owned Shares directly.
SECTION 1.2. NO INCONSISTENT ARRANGEMENTS. Except as
contemplated by this Agreement and the Merger Agreement, each Stockholder shall
not during the Term (i) transfer (which term shall include, without limitation,
any sale, assignment, gift, pledge, hypothecation or other disposition), or
consent to any transfer of, any or all of such Stockholder's Owned Shares or any
interest therein, or create or, except as set forth on Schedule 1.2 hereto,
permit to exist any Encumbrance (as defined below) on such Owned Shares, (ii)
enter into any contract, option or other agreement or understanding with respect
to any transfer of any or all of such Owned Shares or any interest therein,
(iii) grant any proxy, power-of- attorney or other authorization in or with
respect to such Owned Shares, (iv) deposit such Owned Shares into a voting trust
or enter into a voting agreement or arrangement with respect to such Owned
Shares, or (v) take any other action that would in any way restrict, limit or
interfere with the performance of its obligations hereunder or the transactions
contemplated hereby or by the Merger Agreement.
SECTION 1.3. PROXY. Each Stockholder hereby revokes any and
all prior proxies or powers of attorney in respect of any of such Stockholder's
Owned Shares and constitutes and appoints Purchaser and Parent, or any nominee
of Purchaser and Parent, with full power of substitution and resubstitution, at
any time during the Term, as its true and lawful attorney and proxy (its
"Proxy"), for and in its name, place and stead, to demand that the Secretary of
the
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Company call a special meeting of the stockholders of the Company for the
purpose of considering any matter referred to in Section 1.1 (if permitted
under the Company's Restated Certificate of Incorporation or By-Laws) and to
vote each of such Owned Shares as its Proxy, at every annual, special,
adjourned or postponed meeting of the stockholders of the Company, including
the right to sign its name (as stockholder) to any consent, certificate or
other document relating to the Company that Delaware Law may permit or
require as provided in Section 1.1.
THE FOREGOING PROXY AND POWER OF ATTORNEY ARE IRREVOCABLE AND
COUPLED WITH AN INTEREST THROUGHOUT THE TERM.
SECTION 1.4. WAIVER OF APPRAISAL RIGHTS. Each Stockholder
hereby waives any rights of appraisal or rights to dissent from the Merger.
SECTION 1.5. STOP TRANSFER. Each Stockholder shall not request
that the Company register the transfer (book-entry or otherwise) of any
certificate or uncertificated interest representing any of such Stockholder's
Owned Shares, unless such transfer is made in compliance with this Agreement
(including the provisions of Article III hereof).
SECTION 1.6. NO SOLICITATION. During the Term, each
Stockholder shall not, nor shall it permit or authorize any of its officers,
directors, employees, agents or representatives (collectively, the
"Representatives") to, (i) solicit or initiate, or encourage, directly or
indirectly, any inquiries regarding or the submission of, any proposal for a
Third Party Acquisition, (ii) participate in any discussions or negotiations
regarding, or furnish to any Person any information or data with respect to, or
take any other action to knowingly facilitate the making of any proposal that
constitutes, or may reasonably be expected to lead to, any proposal for a Third
Party Acquisition or (iii) enter into any agreement with respect to any proposal
for a Third Party Acquisition or approve or resolve to approve any proposal for
a Third Party Acquisition. Upon execution of this Agreement, each Stockholder
shall, and it shall cause its Representatives to, immediately cease any existing
activities, discussions or negotiations with any parties conducted heretofore
with respect to any of the foregoing. Each Stockholder will promptly notify
Parent of the existence of any proposal, discussion, negotiation or inquiry
received by such Stockholder, and each Stockholder will immediately communicate
to Parent the terms of any proposal, discussion, negotiation or inquiry which it
may receive (and will promptly provide to Parent copies of any written materials
received by it in connection with such proposal, discussion, negotiation or
inquiry) and the identity of the Person making such proposal or inquiry or
engaging in such discussion or negotiation.
ARTICLE II.
TENDER OF SHARES
SECTION 2.1. TENDER. Each Stockholder shall validly tender (or
cause the record owner of such shares to validly tender) such Stockholder's
Owned Shares pursuant to and in accordance with the terms of the Offer, not
later than the fifth business day after commencement of the Offer pursuant to
Section 1.1 of the Merger Agreement and Rule 14d-2 under the Exchange Act, and
not thereafter withdraw such tender. Each Stockholder hereby
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acknowledges and agrees that Parent's and Purchaser's obligation to accept
for payment and pay for such Stockholder's Owned Shares in the Offer is
subject to the terms and conditions of the Offer. For all its Shares validly
tendered in the Offer and not withdrawn, each Stockholder will be entitled to
receive the highest price paid by Purchaser pursuant to the Offer.
SECTION 2.2. CERTAIN WARRANTIES. Without limiting the
generality or effect of any other term or condition of the Offer, the transfer
by Stockholder of the Owned Shares to Purchaser in the Offer shall pass to and
unconditionally vest in Purchaser good and valid title to the Owned Shares, free
and clear of all Encumbrances whatsoever.
SECTION 2.3. DISCLOSURE. Each Stockholder hereby authorizes
Parent and Purchaser to publish and disclose in the Offer Documents and, if
approval of the Company's stockholders is required under applicable law, the
Proxy Statement (including all documents and schedules filed with the SEC), its
identity and ownership of the Shares and the nature of its commitments,
arrangements and understandings under this Agreement.
ARTICLE III
OPTION
SECTION 3.1. GRANT OF OPTION. In order to induce Parent and
Purchaser to enter into the Merger Agreement, each Stockholder hereby grants to
Parent or Purchaser, as Parent may designate (the "Optionee"), an irrevocable
option (each such option, a "Stock Option") to purchase all, but not less than
all, of such Stockholder's Owned Shares at a purchase price per share equal to
the higher of (i) $13.00, and (ii) if the Offer is consummated, the highest
price paid by Purchaser pursuant to the Offer (the "Exercise Price").
SECTION 3.2. RIGHT TO EXERCISE. Each Stock Option may be
exercised by the Optionee if (i) the Merger Agreement becomes terminable under
circumstances that would entitle Parent to receive the Termination Fee pursuant
to Section 7.3(a) of the Merger Agreement, or (ii) the Offer is consummated but
(due to failure by the Stockholder who has granted such Stock Option to tender
validly and not withdraw) Purchaser has not accepted for payment or paid for all
such Stockholder's Owned Shares.
SECTION 3.3. CONDITIONS. Each Stock Option (i) shall become
exercisable, in whole but not in part, on the date on which the first event
referred to in Section 3.2 shall occur or, if later, the date on which (A) all
waiting periods under the HSR Act required for the purchase of the Owned Shares
upon such exercise shall have expired or been waived and all approvals of and
consents to such purchase required under applicable foreign antitrust and
competition laws shall have been obtained and be in full force and effect and
(B) there shall not be in effect any preliminary or final injunction or other
order issued by any court or governmental, administrative or regulatory agency
or authority prohibiting the exercise of such Stock Option pursuant to this
Agreement, and (ii) shall remain exercisable until the date which is ninety (90)
days following the first such date on which such Stock Option becomes
exercisable.
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SECTION 3.4. PAYMENT AND DELIVERY. If the Optionee wishes to
exercise a Stock Option it shall, prior to the expiration thereof, send a
written notice to Stockholder identifying the time and place for the closing of
such purchase at least three but not more than 10 business days prior to such
closing. On the date of such closing, Parent shall deliver the Exercise Price
multiplied by the total number of Owned Shares being acquired against delivery
by Stockholders of all certificates representing such Owned Shares, duly
endorsed or accompanied by appropriate instruments of transfer. Upon such
delivery by the Stockholders, good and valid title to such Owned Shares shall
pass to and unconditionally vest in Purchaser, free and clear of all
Encumbrances whatsoever.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS
Each Stockholder hereby represents and warrants to Parent and
Purchaser as follows:
SECTION 4.1. DUE AUTHORIZATION, ETC. Such Stockholder has all
requisite power and authority to execute, deliver and perform this Agreement, to
appoint Purchaser and Parent as its Proxy and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement,
the appointment of Purchaser and Parent as Stockholder's Proxy and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary action on the part of Stockholder. This Agreement has been duly
executed and delivered by or on behalf of such Stockholder and constitutes a
legal, valid and binding obligation of such Stockholder, enforceable against
such Stockholder in accordance with its terms, except as enforcement may be
limited by bankruptcy, insolvency, moratorium or other similar laws and except
that the availability of equitable remedies, including specific performance, is
subject to the discretion of the court before which any proceeding for such
remedy may be brought. There is no beneficiary or holder of a voting trust
certificate or other interest of any trust of which such Stockholder is trustee
whose consent is required for the execution and delivery of this Agreement of
the consummation by such Stockholder of the transactions contemplated hereby.
SECTION 4.2. NO CONFLICTS; REQUIRED FILINGS AND CONSENTS.
(a) The execution and delivery of this Agreement by such
Stockholder does not, and the performance of this Agreement by such Stockholder
will not, (i) conflict with or violate any trust agreement or other similar
documents relating to any trust of which such Stockholder is trustee, (ii)
conflict with or violate any law applicable to such Stockholder or by which such
Stockholder or any of such Stockholder's 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 give to others
any rights of termination, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any assets of such Stockholder, including,
without limitation, such Stockholder's Owned Shares, pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which such Stockholder is a party
or by which such Stockholder or
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any of such Stockholder's assets is bound or affected, except, in the case of
clauses (ii) and (iii), for any such breaches, defaults or other occurrences
that would not prevent or delay the performance by such Stockholder of such
Stockholder's obligations under this Agreement.
(b) The execution and delivery of this Agreement by such
Stockholder does not, and the performance of this Agreement by such Stockholder
will not, require any consent, approval, authorization or permit of, or filing
with or notification to, any governmental or regulatory authority (other than
any necessary filing under the HSR Act or approvals or consents required under
applicable foreign antitrust or competition laws or the Exchange Act), domestic
or foreign, except where the failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, would not
prevent or delay the performance by such Stockholder of such Stockholder's
obligations under this Agreement.
SECTION 4.3. TITLE TO SHARES. Such Stockholder is the sole
record and beneficial owner of its Owned Shares, free and clear of any pledge,
lien, security interest, mortgage, charge, claim, equity, option, proxy, voting
restriction, voting trust or agreement, understanding, arrangement, right of
first refusal, limitation on disposition, adverse claim of ownership or use or
encumbrance of any kind ("Encumbrances"), other than as set forth on Schedule
1.2 hereto and other than restrictions imposed by the securities laws or
pursuant to this Agreement and the Merger Agreement.
SECTION 4.4. NO FINDER'S FEES. No broker, investment banker,
financial advisor or other person is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
such Stockholder. Such Stockholder, on behalf of itself and its affiliates,
hereby acknowledges that it is not entitled to receive any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby or by the Merger Agreement.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF
PARENT AND PURCHASER
Parent and Purchaser hereby, jointly and severally, represent
and warrant to the Stockholders as follows:
SECTION 5.1. DUE ORGANIZATION, AUTHORIZATION, ETC. Purchaser
and Parent are duly organized, validly existing and in good standing under the
laws of their jurisdiction of incorporation. Purchaser and Parent have all
requisite corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby by each of Purchaser and Parent have been duly authorized by all
necessary corporate action on the part of Purchaser and Parent, respectively.
This Agreement has been duly executed and delivered by each of Purchaser and
Parent and constitutes a legal, valid and binding obligation of each of
Purchaser and Parent, enforceable against Purchaser and Parent in
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accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, moratorium or other similar laws and except that the
availability of equitable remedies, including specific performance, is
subject to the discretion of the court before which any proceeding for such
remedy may be brought.
SECTION 5.2. INVESTMENT INTENT. The Optionee is acquiring each
Stock Option and, if and when it exercises such Stock Option, will be acquiring
the Owned Shares purchased upon the exercise thereof for its own account and not
with a view to distribution or resale in any manner which would be in violation
of the Securities Act.
ARTICLE VI.
MISCELLANEOUS
SECTION 6.1. DEFINITIONS. Terms used but not otherwise
defined in this Agreement have the meanings ascribed to such terms in the Merger
Agreement.
SECTION 6.2. TERMINATION. This Agreement shall terminate and
be of no further force and effect (i) by the written mutual consent of the
parties hereto or (ii) automatically and without any required action of the
parties hereto upon the Effective Time. No such termination of this Agreement
shall relieve any party hereto from any liability for any breach of this
Agreement prior to termination.
SECTION 6.3. FURTHER ASSURANCE. From time to time, at another
party's request and without consideration, each party hereto shall execute and
deliver such additional documents and take all such further action as may be
necessary or desirable to consummate and make effective, in the most expeditious
manner practicable, the transaction contemplated by this Agreement.
SECTION 6.4. CERTAIN EVENTS. Each Stockholder agrees that this
Agreement and such Stockholder's obligations hereunder shall attach to such
Stockholder's Owned Shares and shall be binding upon any person or entity to
which legal or beneficial ownership of such Owned Shares shall pass, whether by
operation of law or otherwise, including, without limitation, such Stockholder's
heirs, guardians, administrators, or successors. Notwithstanding any transfer of
Owned Shares, the transferor shall remain liable for the performance of all its
obligations under this Agreement.
SECTION 6.5. 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, 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.
SECTION 6.6. SPECIFIC PERFORMANCE. Each Stockholder
acknowledges that if such Stockholder fails to perform any of its obligations
under this Agreement immediate and
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irreparable harm or injury would be caused to Parent and Purchaser for which
money damages would not be an adequate remedy. In such event, each
Stockholder agrees that each of Parent and Purchaser shall have the right, in
addition to any other rights it may have, to specific performance of this
Agreement. Accordingly, if Parent or Purchaser should institute an action or
proceeding seeking specific enforcement of the provisions hereof, each
Stockholder hereby waives the claim or defense that Parent or Purchaser, as
the case may be, has an adequate remedy at law and hereby agrees not to
assert in any such action or proceeding the claim or defense that such a
remedy at law exists. Each Stockholder further agrees to waive any
requirements for the securing or posting of any bond in connection with
obtaining any such equitable relief.
SECTION 6.7. NOTICE. All notices and other communications
given or made pursuant hereto shall be in writing and shall be deemed to have
been duly given or made (i) as of the date delivered or sent by facsimile if
delivered personally or by facsimile, and (ii) on the third business day after
deposit in the U.S. mail, if mailed by registered or certified mail (postage
prepaid, return receipt requested), in each case to the parties at the following
addresses (or at such other address for a party as shall be specified by like
notice, except that notices of changes of address shall be effective upon
receipt):
(a) If to Parent or Purchaser: Cadence Design Systems, Inc.
0000 Xxxxx Xxxx, Xxxx. 0
Xxx Xxxx, XX 00000
Telecopier: 000-000-0000
Attention: General Counsel
with a copy to: Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopier: 000-000-0000
Attention: Xxxxxx X. Xxxxx
(b) If to a Stockholder, at the address set forth below
such Stockholder's name on Schedule I hereto.
SECTION 6.8. EXPENSES. Except as otherwise expressly set forth
herein, all fees, costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such fees, costs and expenses.
SECTION 6.9. HEADINGS. The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
SECTION 6.10. SEVERABILITY. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any rule of
law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is
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invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the
end that transactions contemplated hereby are fulfilled to the maximum extent
possible.
SECTION 6.11. ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES.
This Agreement constitutes the entire agreement and supersede any and all other
prior agreements and undertakings, both written and oral, among the parties, or
any of them, with respect to the subject matter hereof, and this Agreement is
not intended to confer upon any other person any rights or remedies hereunder.
SECTION 6.12. ASSIGNMENT. This Agreement shall not be
assigned by operation of law or otherwise.
SECTION 6.13. GOVERNING LAW. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Delaware
applicable to contracts executed in and to be performed entirely within that
State.
SECTION 6.14. AMENDMENT. This Agreement may not be amended
except by an instrument in writing signed by the parties hereto.
SECTION 6.15. WAIVER. Any party hereto may (a) extend the
time for the performance of any of the obligations or other acts of the other
parties hereto, (b) waive any inaccuracies in the representations and warranties
of the other parties hereto contained herein or in any document delivered
pursuant hereto and (c) waive compliance by the other parties hereto with any of
their agreements or conditions contained herein. Any agreement on the part of a
party hereto to any such extension or waiver shall be valid only as against such
party and only if set forth in an instrument in writing signed by such party.
The failure of any party hereto to assert any of its rights under this Agreement
or otherwise shall not constitute a waiver of those rights.
SECTION 6.16. COUNTERPARTS. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which shall constitute one and the same agreement.
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IN WITNESS WHEREOF, Parent, Purchaser and the Stockholders
have caused this Agreement to be executed as of the date first written above.
CADENCE DESIGN SYSTEMS, INC.
By: /s/ H. Xxxxxxx Xxxxxxx
-------------------------------
Name: H. Xxxxxxx Xxxxxxx
-----------------------------
Title: President & CEO
----------------------------
CDSI ACQUISITION CORPORATION
By: /s/ H. Xxxxxxx Xxxxxxx
-------------------------------
Name: H. Xxxxxxx Xxxxxxx
-----------------------------
Title: President & CEO
----------------------------
/s/ Wolfram X. Xxxxx
-------------------------
Wolfram X. Xxxxx
/s/ Xxxxx Xxxxxxxxxx
--------------------------
Xxxxx Xxxxxxxxxx, an individual
THE D3 FAMILY FUND, L.P.
By: Xxxxxxxxxx Investment Management
Company, Inc., as Its General
Partner
By: /s/ Xxxxx Xxxxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxxxx
Title: President
/s/ Xxxxxxx X. Xxxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxxx
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Schedule I
NAME AND ADDRESS OF STOCKHOLDER NUMBER OF SHARES OWNED
Wolfram X. Xxxxx
00 Xxxxxx Xxxxxx 1,218,276
Xxxxxx Xxxxxx, XX 00000
Xxxxx Xxxxxxxxxx 64,475
00000 X.X. 0xx Xxxxxx
Xxxxx, Xxxxxxxxxx 00000
The D3 Family Fund, L.P. 406,900
00000 X.X. 0xx Xxxxxx
Xxxxx, Xxxxxxxxxx 00000
Xxxxxxx X. Xxxxxxxx
OrCAD, Inc. 68,417
0000 X.X. Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Total 1,758,068
