EXHIBIT 99-b
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT, dated as of February 22, 2000 (the
"AGREEMENT"), between ADC Telecommunications, Inc., a Minnesota corporation
("OPTIONEE"), and PairGain Technologies, Inc., a Delaware Corporation (the
"COMPANY"). Capitalized terms which are used but not defined herein shall have
the meanings ascribed to them in the Merger Agreement (as defined below).
WITNESSETH:
WHEREAS, simultaneously with the execution and delivery of this
Agreement, Optionee and the Company are entering into an Agreement and Plan of
Merger, dated as of the date hereof (the "MERGER AGREEMENT"), which provides for
a wholly owned subsidiary of Optionee to be merged with and into the Company in
accordance with the General Corporation Law of the State of Delaware and the
terms of the Merger Agreement, as a result of which the Company will be the
surviving corporation and a wholly owned subsidiary of Optionee;
WHEREAS, as a condition to Optionee's willingness to enter into
the Merger Agreement, Optionee has requested that the Company grant to Optionee
an option to purchase up to 14,489,951 authorized but unissued shares of the
Company's common stock, upon the terms and subject to the conditions hereof; and
WHEREAS, in order to induce Optionee to enter into the Merger
Agreement, the Company has agreed to grant Optionee the requested option.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein and in the Merger Agreement, the
parties hereto agree as follows:
1. THE OPTION; EXERCISE; ADJUSTMENTS.
(a) The Company hereby grants to Optionee an irrevocable option
(the "OPTION") to purchase from time to time up to 14,489,951 authorized but
unissued shares of common stock, par value $.0005 per share, of the Company (the
"COMPANY COMMON STOCK") upon the terms and subject to the conditions set forth
herein (the "OPTIONED SHARES," which represent 19.9% of the issued and
outstanding shares of Company Common Stock as of the date hereof); provided,
however, that in no event shall the number of shares of Company Common Stock for
which the Option is exercisable exceed 19.9% of the issued and outstanding
shares of Company Common Stock at the time of exercise (excluding any such
shares issued or issuable under the Option).
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(b) Subject to the terms and conditions set forth in this
Agreement, the Option may be exercised by Optionee in whole or, from time to
time, in part, at any time within 270 days after the date hereof that the
conditions in Section 2(a) hereof are satisfied and prior to the termination of
the Option in accordance with Section 11 hereof. In the event Optionee wishes
to exercise the Option, Optionee shall send a written notice to the Company (the
"STOCK EXERCISE NOTICE") specifying the total number of Optioned Shares it
wishes to purchase and a date for the closing of such purchase, which date shall
be not less than five days or more than 60 days after the Company's receipt of
the Stock Exercise Notice (the "CLOSING DATE"). Optionee may revoke an exercise
of the Option at any time prior to the Closing Date by written notice to the
Company. At any Closing Date, the Company will deliver to Optionee a
certificate or certificates representing the Optioned Shares (which shall be
endorsed with appropriate restrictive legends) in the denominations designated
by Optionee in its Stock Exercise Notice, free and clear of all liens and
encumbrances and subject to no preemptive rights, as well as an executed new
agreement with the same terms as this Agreement evidencing the right to purchase
the balance of the Optioned Shares purchasable hereunder, if any. After payment
of the Exercise Price for the Optioned Shares covered by the Stock Exercise
Notice, the Option shall be deemed exercised to the extent of the Optioned
Shares specified in the Stock Exercise Notice as of the date such Stock Exercise
Notice is given to the Company.
(c) In the event of any change in the number of issued and
outstanding shares of Company Common Stock by reason of any share dividend,
reclassification, consolidation, division, subdivision or cancellation or other
similar change in the corporate or capital structure of the Company, the number
of Optioned Shares subject to the Option and the Exercise Price (as hereinafter
defined) per Optioned Share shall be appropriately adjusted. In the event that
any additional shares of Company Common Stock are issued after the date of this
Agreement (other than pursuant to an event described in the preceding sentence
or pursuant to this Agreement), the number of Optioned Shares subject to the
Option shall be adjusted so that, after such issuance, it equals at least 19.9%
of the number of shares of Company Common Stock then issued and outstanding
(without considering any shares subject to or issued pursuant to the Option).
2. CONDITIONS TO EXERCISE OF OPTION AND DELIVERY OF OPTIONED SHARES.
(a) Optionee's right to exercise the Option is subject to the
following conditions:
(i) No preliminary or permanent injunction or other order
having been issued by any federal or state court of competent
jurisdiction in the United States invalidating the grant or prohibiting
the exercise of the Option shall be in effect; and
(ii) One or more of the following events shall have occurred on
or after the date hereof or Optionee shall have become aware on or after
the date hereof of the occurrence of any of the following: (A) any
individual, corporation, limited liability
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company, limited or general partnership, joint venture, association,
joint stock company, trust, unincorporated organization or other
entity or group (referred to hereinafter, singularly or collectively,
as a "PERSON"), other than Optionee or its "affiliates" (as defined in
Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT")), acquires or becomes the beneficial
owner of 20% or more of the outstanding shares of Company Common
Stock; (B) any new group is formed which beneficially owns 20% or more
of the outstanding shares of Company Common Stock (other than a group
which includes or may reasonably be deemed to include Optionee or any
of its affiliates); (C) any Person (other than Optionee or its
affiliates) shall have commenced a tender or exchange offer for 20% or
more of the then outstanding shares of Company Common Stock or
publicly proposed any bona fide merger, consolidation or acquisition
of all or substantially all the assets of the Company, or other
similar business combination involving the Company; (D) any Person
(other than Optionee or its affiliates) is granted any option or
right, conditional or otherwise, to acquire or otherwise become the
beneficial owner of shares of Company Common Stock which, together
with all shares of Company Common Stock beneficially owned by such
Person, results or would result in such Person being the beneficial
owner of 20% or more of the outstanding shares of Company Common
Stock; or (E) any event or circumstance occurs that would entitle
Optionee to receive the Termination Fee provided for in Section 7.3(c)
of the Merger Agreement. For purposes of this subparagraph (iii), the
terms "group" and "beneficial owner" shall be defined by reference to
Section 13(d) of the Exchange Act.
(b) Optionee's obligation to purchase the Optioned Shares
following the exercise of the Option, and the Company's obligation to deliver
the Optioned Shares, are subject to the conditions that:
(i) No preliminary or permanent injunction or other order
issued by any federal or state court of competent jurisdiction in the
United States prohibiting the delivery of the Optioned Shares shall be in
effect;
(ii) The purchase of the Optioned Shares will not violate Rule
14e-5 promulgated under the Exchange Act; and
(iii) All applicable waiting periods under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR ACT"), shall
have expired or been terminated.
3. EXERCISE PRICE FOR OPTIONED SHARES. Optionee will purchase the
Optioned Shares from the Company at a price per Optioned Share equal to $18.03
(the "EXERCISE PRICE"), payable in cash. Any payment made by Optionee to the
Company pursuant to this Agreement shall be
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made by wire transfer of federal funds to a bank account designated by the
Company or a check payable in immediately available funds.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to Optionee as follows:
(a) CORPORATE AUTHORITY. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has 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 by the Company and the consummation
by it of the transactions contemplated hereby have been duly authorized by the
Company's Board of Directors and no other corporate proceedings on the part of
the Company are necessary to authorize this Agreement or to consummate the
transactions so contemplated. This Agreement has been duly executed and
delivered by the Company and constitutes a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms except to
the extent that its enforceability may be limited to applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other laws
affecting creditors rights generally and to general equitable principles.
(b) SHARES RESERVED FOR ISSUANCE. The Company has taken all
necessary corporate action to authorize and reserve and permit it to issue, and
at all times from the date hereof through the termination of this Agreement in
accordance with its terms, will have reserved for issuance upon exercise of this
Option, that number of Optioned Shares equal to the maximum number of shares of
Company Common Stock at any time and from time to time purchasable upon exercise
of the Option, and the Optioned Shares, when issued and delivered by the Company
to Optionee upon exercise of the Option, will be duly authorized, validly
issued, fully paid and nonassessable, free and clear of all liens or
encumbrances, free of preemptive rights, and the Optioned Shares shall be listed
on the Nasdaq National Market.
(c) CONSENTS; NO VIOLATIONS. Except as otherwise required by
the HSR Act, except for routine filings and subject to Section 7, the execution
and delivery of this Agreement by the Company and the consummation by it of the
transactions contemplated hereby do not and will not require the consent,
approval or authorization of, or filing with, any Person or public authority and
(i) will not violate, breach or conflict with the Company's Charter Documents or
Governing Documents, or (ii) result in the acceleration or termination of, or
constitute a default under, any agreement, lease, contract, note, indenture,
license, approval, permit, understanding or other instrument, or any statute,
rule, regulation, judgment, order or other restriction binding upon or
applicable to the Company or any of its subsidiaries or any of their respective
properties or assets, except for any such acceleration, termination or default
which could not reasonably be expected to have a Company Material Adverse
Effect.
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5. REPRESENTATIONS AND WARRANTIES OF OPTIONEE. Optionee represents
and warrants to the Company as follows:
(a) CORPORATE AUTHORITY. The execution and delivery of this
Agreement by Optionee and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Optionee and this Agreement has been duly executed and delivered
by Optionee and constitutes a valid and binding agreement of Optionee, except to
the extent that its enforceability may be limited to applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other laws
affecting creditors rights generally and to general equitable principles.
(b) INVESTMENT REPRESENTATIONS. Optionee is acquiring the
Option and, if and when it exercises the Option, will be acquiring the Optioned
Shares issuable 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 of 1933, as amended (the "SECURITIES ACT"), or any rule or
regulation under the Securities Act, and will not sell or otherwise dispose of
the Optioned Shares except pursuant to an effective registration statement under
the Securities Act or a valid exemption from registration under the Securities
Act.
6. THE CLOSING. Any closing hereunder shall take place on the
Closing Date specified by Optionee in its Stock Exercise Notice pursuant to
Section 1 at 10:00 a.m., U.S. Pacific Time, or the first business day thereafter
on which all of the conditions in Section 2 are met, at the executive office of
the Company located in Tustin, California, or at such other time and place as
the parties hereto may agree.
7. FILINGS RELATED TO OPTIONED SHARES. The Company will make such
filings with the SEC as are required by the Exchange Act, and will make all
necessary filings by the Company under the HSR Act and to list the Optioned
Shares on the Nasdaq National Market.
8. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION RIGHTS. After the date the Option
becomes exercisable pursuant to Section 1(b), the Company shall, subject to the
conditions of Section 8(c) below, if requested by Optionee within 12 months
following such date, as expeditiously as possible prepare and file a
registration statement under the Securities Act if such registration is
necessary in order to permit the sale or other disposition of any or all shares
of Company Common Stock or other securities that have been acquired by or are
issuable to the Selling Shareholder upon exercise of the Option in accordance,
subject to the terms and conditions of this Section 8, with the intended method
of sale or other disposition stated by the Optionee in such request, including
without limitation a "shelf" registration statement under Rule 415 under the
Securities Act or any successor provision ("RULE 415"), and the Company shall
use its best efforts to qualify such shares or other securities for sale under
any applicable state securities
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laws; PROVIDED, HOWEVER, that the Company shall not be required to consent to
general jurisdiction or qualify to do business in any state where it is not
otherwise required to so consent to such jurisdiction or to so qualify to do
business.
(b) ADDITIONAL REGISTRATION RIGHTS. If the Company, at any
time after the exercise of the Option, proposes to register any securities of
the Company or rights representing securities of the Company under the
Securities Act, the Company will promptly give written notice to the Optionee
of its intention to do so and, upon the written request of any Optionee given
within thirty (30) days after receipt of any such notice (which request shall
specify the number of Shares of Company Common Stock intended to be included
in such public offering by the Optionee), the Company will cause all such
shares for which a Optionee requests participation in such registration, to
be so registered and included in such public offering; PROVIDED, HOWEVER,
that the Company may elect not to cause any such shares to be so registered
(i) if such public offering is to be underwritten and the underwriters in
good faith object for valid business reasons, or (ii) in the case of a
registration solely to implement an employee benefit plan or a registration
filed on Form S-4 of the Securities Act or any successor form; PROVIDED,
FURTHER, HOWEVER, that such election pursuant to (i) may only be made twice.
If some but not all of the shares of Company Common Stock with respect to
which the Company shall have received requests for registration pursuant to
this Section 8(b) shall be excluded from such registration, the Company shall
make appropriate allocation of shares to be registered among the selling
shareholders desiring to register their shares pro rata in the proportion
that the number of shares requested to be registered by each such selling
shareholder bears to the total number of shares requested to be registered by
all such selling shareholders then desiring to have shares of Company Common
Stock registered for sale.
(c) CONDITIONS TO REQUIRED REGISTRATION. The Company shall
use all reasonable efforts to cause each registration statement referred to
in Section 8(a) above to become effective and to obtain all consents or
waivers of other parties which are required therefor and to keep such
registration effective; PROVIDED, HOWEVER, that the Company may delay any
registration of Optioned Shares required pursuant to Section 8(a) above for a
period not exceeding 90 days provided the Company shall in good faith
determine that any such registration would adversely affect the Company
(provided that this right may not be exercised more than once during any
twelve (12) month period), and the Company shall not be required to register
Optioned Shares under the Securities Act pursuant to Section 8(a) above:
(i) on more than one occasion during any calendar
year;
(ii) on more than two occasions in total;
(iii) within ninety (90) days after the effective date
of a registration referred to in Section 8(b) above pursuant to which
the Optionee was afforded the
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opportunity to register such shares under the Securities Act and such
shares were registered as requested; or
(iv) if all the Optioned Shares proposed to be
registered could be sold by the Optionee in a ninety (90) day period
in accordance with Rule 144.
In addition to the foregoing, the Company shall not be required to
maintain the effectiveness of any registration statement, other than a
registration statement filed under Rule 415, after the expiration of six (6)
months from the effective date of such registration statement. The Company
shall use all reasonable efforts to make any filings, and take all steps,
under all applicable state securities laws to the extent necessary to permit
the sale or other disposition of the Optioned Shares so registered in
accordance with the intended method of distribution for such shares;
PROVIDED, HOWEVER, that the Company shall not be required to consent to
general jurisdiction or qualify to do business in any state where it is not
otherwise required to so consent to such jurisdiction or to so qualify to do
business. The Optionee shall provide the Company with all information
reasonably requested by the Company that is necessary for inclusion in any
registration statement required to be filed hereunder.
(d) EXPENSES. Except where applicable state law prohibits
such payments, the Company will pay all expenses (including without
limitation registration fees, qualification fees, blue sky fees and expenses
(including the fees and expenses of counsel), legal expenses, including the
reasonable fees and expenses of one counsel to the holders whose Optioned
Shares are being registered, printing expenses and the costs of special
audits or "cold comfort" letters, expenses of underwriters, excluding
discounts and commissions but including liability insurance if the Company so
desires or the underwriters so require, and the reasonable fees and expenses
of any necessary special experts) in connection with each registration
pursuant to Section 8(a) or 8(b) above (including the related offerings and
sales by holders of Optioned Shares) and all other qualifications,
notifications or exemptions pursuant to Section 8(a) or 8(b) above.
(e) INDEMNIFICATION. In connection with any registration
under Section 8(a) or 8(b) above, the Company hereby indemnifies the
Optionee, and each underwriter thereof, including each person, if any, who
controls such Optionee or underwriter within the meaning of Section 15 of the
Securities Act, against all expenses, losses, claims, damages and liabilities
caused by any untrue, or alleged untrue, statement of a material fact
contained in any registration statement or prospectus or notification or
offering circular (including any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission, or alleged omission, to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such expenses,
losses, claims, damages or liabilities of such indemnified party are caused
by any untrue statement or prospectus or notification or offering circular
(including any amendments or supplements thereto) in reliance upon and in
conformity with, information furnished in writing to the Company by such
indemnified party expressly for use therein, and the Company and each
officer, director and
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controlling person of the Company shall be indemnified by Optionee, or by
such underwriter, as the case may be, for all such expenses, losses, claims,
damages and liabilities caused by any untrue, or alleged untrue, statement,
that was included by the Company in any such registration statement or
prospectus or notification or offering circular (including any amendments or
supplements thereto) in reliance upon, and in conformity with, information
furnished in writing to the Company by or on behalf of Optionee or such
underwriter, as the case may be, expressly for such use.
Promptly upon receipt by a party indemnified under this Section 8(e)
of notice of the commencement of any action against such indemnified party in
respect of which indemnity or reimbursement may be sought against any
indemnifying party under this Section 8(e), such indemnified party shall
notify the indemnifying party in writing of the commencement of such action,
but the failure so to notify the indemnifying party shall not relieve it or
any liability which it may otherwise have to any indemnified party under this
Section 8(e) except to the extent the indemnified party is materially
prejudiced thereby. In case notice of commencement of any such action shall
be given to the indemnifying party as above provided, the indemnifying party
shall be entitled to participate in and, to the extent it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
of such action at its own expense, with counsel chosen by it and reasonably
satisfactory to such indemnified party. The indemnified party shall have the
right to employ separate counsel (other than reasonable costs of
investigation) shall be paid by the indemnified party unless (i) the
indemnified party either agrees to pay the same, (ii) the indemnifying party
fails to assume the defense of such action with counsel reasonably
satisfactory to the indemnified party, or (iii) the indemnified party has
been advised by counsel that one or more legal defenses may be available to
the indemnifying party that may be contrary to the interest of the
indemnified party, in which case the indemnifying party shall be entitled to
assume the defense of such action notwithstanding its obligation to bear fees
and expenses of such counsel. No indemnifying party shall be liable for any
settlement entered into without its consent, which consent may not be
unreasonably withheld.
If the indemnification provided for in this Section 8(e) is
unavailable to a party otherwise entitled to be indemnified in respect of any
expenses, losses, claims, damages or liabilities referred to herein, then the
indemnifying party, in lieu of indemnifying such party otherwise entitled to
be indemnified, shall contribute to the amount paid or payable by such party
to be indemnified as a result of such expenses, losses, claims, damages or
liabilities in such proportion as is appropriate to reflect the relative
benefits received by the Company, the Optionee and the underwriters from the
offering of the securities and also the relative fault of the Company, the
Optionee and the underwriters in connection with the statements or omissions
which resulted in such expenses, losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The amount paid or
payable by a party as a result of the expenses, losses, claims, damages and
liabilities referred to above shall be deemed to include any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim; PROVIDED, HOWEVER, that in no
case shall Optionee be responsible, in the
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aggregate, for any amount in excess of the net offering proceeds attributable
to its Optioned Shares included in the offering. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. Any obligation by Optionee to
contribute shall be several and not joint with other holders.
In the event of an underwritten public offering pursuant to Section
8(b), the Company and the Optionee shall enter into an underwriting agreement
containing customary terms and provisions; PROVIDED that the contribution
provisions as they relate to Optionee shall contain substantially the same
limitations as the provisions set forth herein.
(f) MISCELLANEOUS REPORTING. The Company shall comply with
all reporting requirements and will do all other such things as may be
necessary to permit the expeditious sale at any time of any Optioned Shares
by the Optionee in accordance with and to the extent permitted by any rule or
regulation promulgated by the SEC from time to time, including, without
limitation, Rule 144. The Company shall provide the Optionee with any
information necessary in connection with the completion and filing of any
reports or forms required to be filed by them under the Securities Act or the
Exchange Act, or required pursuant to any state securities laws or the rules
of any stock exchange.
(g) ISSUE TAXES. The Company will pay all stamp taxes in
connection with the issuance and the sale of Optioned Shares and in
connection with the exercise of the Option, and will hold the Optionee
harmless, without limitation as to time, against any and all liabilities,
with respect to all such taxes.
9. OPTIONAL PUT. Prior to the termination of the Option in
accordance with Section 11 hereof, if the Option has become exercisable
pursuant to Section 1(b) hereof and pursuant to the second sentence of this
Section 9, Optionee shall have the right, upon three (3) business days' prior
written notice to the Company, to require the Company to purchase the Option
from Optionee (the "PUT RIGHT") at a cash purchase price (the "PUT PRICE")
equal to the product determined by multiplying (A) the number of Optioned
Shares as to which the Option has not yet been exercised by (B) the Spread
(as defined below). As used herein, the term "SPREAD" shall mean the excess,
if any, of (i) the greater of (x) the highest price (in cash or fair market
value of securities or other property) per share of Company Common stock paid
or to be paid within twelve (12) months preceding the date of exercise of the
Put Right for any Company Common Stock beneficially owned by any Person who
shall have acquired or become the beneficial owner of 20% or more of the
outstanding shares of Company Common Stock after the date hereof or (y) the
weighted (by volume of shares traded each day during the measurement period
described herein) average closing price of the Company Common Stock during
the 15-day period ending on the trading day immediately preceding the written
notice of exercise of the Put Right over (ii) the Exercise Price. This Put
Right shall become exercisable with respect to the events described in
clauses (A), (B), (C) and (D) of Section 2(a)(ii) hereof only if the
beneficial ownership by the
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Person or group referenced in such clauses equals or exceeds 30% of the
outstanding Company Common Stock. Upon exercise of Optionee's right to
receive cash pursuant to this Section 9, the obligation of the Company to
deliver Optioned Shares pursuant to this Agreement shall terminate with
respect to such number of Optioned Shares for which Optionee shall have
elected to be paid in cash under this Section 9.
10. PROFIT LIMITATION.
(a) Notwithstanding any other provision of this Agreement,
in no event shall Optionee's Total Profit (as hereinafter defined) exceed
$43,000,000 and, if it otherwise would exceed such amount, Optionee, at its
sole election, shall either (i) deliver to the Company for cancellation
Optioned Shares previously acquired by Optionee pursuant to this Agreement,
(ii) pay cash or other consideration to the Company, or (iii) undertake any
combination thereof, in each case, so that Optionee's Total Profit shall not
exceed $43,000,000 after taking into account the foregoing actions.
(b) As used herein, the term "Total Profit" shall mean the
sum (before taxes) of the following: (i) the amount of cash received by
Optionee pursuant to Section 9 hereof, (ii)(A) the net cash amounts received
by Optionee pursuant to the sale of Optioned Shares (or any other securities
into which such Optioned Shares are converted or exchanged) to any
unaffiliated party, less (B) the aggregate Exercise Price paid for all
Optioned Shares acquired by Optionee hereunder, and (iii) any Termination Fee
received pursuant to the Merger Agreement.
11. TERMINATION. This Agreement and the Option shall terminate
upon the earlier of (i) the Effective Time (as defined in the Merger
Agreement) and (ii) the termination of the Merger Agreement in accordance
with its terms; PROVIDED, HOWEVER, the Option shall terminate pursuant to
clause (ii) nine (9) months following termination of the Merger Agreement if
(A) the Merger Agreement is terminated by Optionee pursuant to Section
7.1(d)(i) or (d)(ii) thereof or (B) the Merger Agreement is terminated by
Optionee or the Company pursuant to Section 7.1(b)(ii) or (b)(iv) thereof
and, in each such case, the Company has not paid to Optionee the Termination
Fee which the Company is then obligated to pay.
12. EXPENSES. Each party hereto shall pay its own expenses
incurred in connection with this Agreement, except as otherwise provided in
Section 8 hereof or as specified in the Merger Agreement.
13. SPECIFIC PERFORMANCE. 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 an injunction or injunctions to prevent breaches of this
Agreement, without the necessity of proving damages or posting any bond, and
to enforce specifically the terms and
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provisions hereof in any court of the United States or any state thereof
having jurisdiction, this being in addition to any other remedy to which they
are entitled at law or in equity.
14. NOTICE. All notices, requests, demands and other
communications hereunder shall be deemed to have been duly given and made if
in writing and if served by personal delivery upon the party for whom it is
intended or if sent by telex or facsimile (with receipt electronically
confirmed) to the person at the address set forth below, or such other
address as may be designated in writing hereafter, in the same manner, by
such person:
(a) if to Optionee:
ADC Telecommunications, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxxx LLP
Pillsbury Center South
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
(b) if to the Company:
PairGain Technologies, Inc.
00000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention:
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
with a copy to:
Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx Xxxxx, XX 00000
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Attention: Xxxx X. Xxxxx, Esq.
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
15. PARTIES IN INTEREST. This Agreement shall inure to the benefit
of and be binding upon the parties named herein and their respective
successors and permitted assigns. Nothing in this Agreement, expressed or
implied, is intended to confer upon any Person other than Optionee or the
Company, or their permitted successors or assigns any rights or remedies
under or by reason of this Agreement.
16. ENTIRE AGREEMENT; AMENDMENTS. This Agreement, together with
the Merger Agreement and the other documents referred to therein, constitutes
the entire agreement between the parties with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and
understandings, both written or oral, between the parties with respect to the
subject matter hereof. This Agreement may not be changed, amended or modified
orally, but only by an agreement in writing signed by the party against whom
any waiver, change, amendment, modification or discharge may be sought.
17. ASSIGNMENT. No party to this Agreement may assign any of its
rights or delegate any of its obligations under this Agreement (whether by
operation of law or otherwise) without the prior written consent of the other
party hereto, except that Optionee may, without a written consent and without
affecting its obligations hereunder, assign its rights and delegate its
obligations hereunder in whole or in part to one or more of its direct or
indirect wholly owned subsidiaries.
18. INTERPRETATION. The language used in this Agreement shall be
deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction shall be applied against any
party. The headings of articles and sections herein are for convenience of
reference, do not constitute a part of this Agreement, and shall not be
deemed to limit or affect any of the provisions hereof.
19. COUNTERPARTS. This Agreement may be executed via facsimile in
two or more counterparts, each of which, when executed, shall be deemed to be
an original and all of which together shall constitute one and the same
document.
20. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without
giving effect to the principles of conflicts of laws thereof.
21. VALIDITY. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any
other provisions of this Agreement, which shall remain in full force and
effect. Upon such determination that any term or other provision is
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invalid, illegal or incapable of being enforced, the parties 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 extent possible.
22. DEFINED TERMS. Capitalized terms which are used but not
defined herein shall have the meanings ascribed to them in the Merger
Agreement.
* * * * *
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IN WITNESS WHEREOF, Optionee and the Company have caused this
Stock Option Agreement to be duly executed and delivered on the day and year
first above written.
PAIRGAIN TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------------
Xxxxxxx X. Xxxxxxx
Chairman of the Board of Directors
ADC TELECOMMUNICATIONS, INC.
By: /s/ Xxxx Xxxxx
----------------------------------------------
Xxxx Xxxxx
Senior Vice President,
President Broadband Access and
Transport Group
