Exhibit 2.1
================================================================================
STOCK ACQUISITION AGREEMENT
among:
ACTIVE VOICE CORPORATION,
a Washington corporation;
PHONESOFT INC.,
a California corporation;
and
XXXX XXXXXX, XXXX XXXX, XXXXXXX XXXXXXX and XXXXXX XXXX
-----------------
Dated as of January 28, 2000
-----------------
================================================================================
TABLE OF CONTENTS
PAGE
SECTION 1. ACQUISITION OF PHONESOFT SHARES; RELATED TRANSACTIONS..............................1
1.1 Acquisition of PhoneSoft Shares.............................................1
1.2 Consideration...............................................................1
1.3 Closing.....................................................................2
1.4 Tax Consequences............................................................3
1.5 Accounting Treatment........................................................3
SECTION 2. REPRESENTATIONS AND WARRANTIES OF PHONESOFT AND XXXX XXXXXX........................3
2.1 Due Organization; No Subsidiaries; Etc......................................3
2.2 Certificate of Incorporation and Bylaws; Records............................4
2.3 Capitalization, Etc.........................................................4
2.4 Financial Statements........................................................5
2.5 Absence of Changes..........................................................5
2.6 Title to Assets.............................................................7
2.7 Bank Accounts...............................................................7
2.8 Receivables.................................................................8
2.9 Proprietary Assets..........................................................8
2.10 Contracts...................................................................9
2.11 Liabilities................................................................10
2.12 Compliance With Legal Requirements.........................................10
2.13 Tax Matters................................................................11
2.14 Benefit Plans..............................................................11
2.15 Related Party Transactions.................................................11
2.16 Proceedings; Orders........................................................12
2.17 Authority; Binding Nature of Agreements....................................12
2.18 Non-Contravention; Consents................................................12
2.19 Brokers....................................................................13
2.20 Full Disclosure............................................................13
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS....................................14
3.1 Authority; Binding Nature of Agreements....................................14
i.
3.2 Shareholder................................................................14
3.3 Investment Representations.................................................14
SECTION 4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.......................................15
4.1 Acquisition of PhoneSoft Shares............................................15
4.2 Authority; Binding Nature of Agreement.....................................15
4.3 Active Voice Shares........................................................16
SECTION 5. PRE-CLOSING COVENANTS OF PHONESOFT AND SHAREHOLDERS...............................16
5.1 Access and Investigation...................................................16
5.2 Conduct of Business........................................................16
5.3 No Negotiation.............................................................17
5.4 Best Efforts...............................................................17
5.5 Confidentiality............................................................17
SECTION 6. PRE-CLOSING COVENANTS OF ACTIVE VOICE.............................................18
6.1 Best Efforts...............................................................18
SECTION 7. CONDITIONS PRECEDENT TO ACTIVE VOICE'S OBLIGATION TO CLOSE........................18
7.1 Satisfactory Completion of Pre-Acquisition Review..........................18
7.2 Accuracy of Representations................................................18
7.3 Performance of Obligations.................................................18
7.4 Approval of Active Voice's Board of Directors..............................18
7.5 No Adverse Change..........................................................18
7.6 Additional Documents.......................................................18
7.7 No Proceedings.............................................................19
7.8 No Claim Regarding Stock Ownership or Sale Proceeds........................19
7.9 No Prohibition.............................................................19
7.10 Exercise of Options........................................................19
SECTION 8. CONDITIONS PRECEDENT TO SHAREHOLDERS' OBLIGATION TO CLOSE.........................19
8.1 Accuracy of Representations................................................19
8.2 Purchaser's Performance....................................................19
8.3 No Injunction..............................................................19
ii.
SECTION 9. TERMINATION.......................................................................20
9.1 Termination Events.........................................................20
9.2 Termination Procedures.....................................................20
9.3 Effect of Termination......................................................20
9.4 Nonexclusivity of Termination Rights.......................................21
SECTION 10. INDEMNIFICATION AND RELATED MATTERS..............................................21
10.1 Survival of Representations, Etc...........................................21
10.2 Indemnification by Shareholders............................................22
10.3 Setoff.....................................................................22
10.4 Exclusive Remedy...........................................................22
10.5 No Contribution............................................................23
10.6 Interest...................................................................23
10.7 Defense of Third Party Claims..............................................23
10.8 Exercise of Remedies by Indemnitees Other Than Purchaser...................24
SECTION 11. MISCELLANEOUS PROVISIONS.........................................................24
11.1 Shareholders' Agent........................................................24
11.2 Further Assurances.........................................................25
11.3 Fees and Expenses..........................................................25
11.4 Attorneys' Fees............................................................26
11.5 Notices....................................................................27
11.6 Publicity..................................................................28
11.7 Time of the Essence........................................................28
11.8 Headings...................................................................28
11.9 Counterparts...............................................................28
11.10 Governing Law; Venue.......................................................28
11.11 Successors and Assigns.....................................................29
11.12 Remedies Cumulative; Specific Performance..................................29
11.13 Waiver.....................................................................29
11.14 Amendments.................................................................30
iii.
11.15 Severability...............................................................30
11.16 Parties in Interest........................................................30
11.17 Entire Agreement...........................................................30
11.18 Construction...............................................................30
11.19 Restrictions on Transfer...................................................31
EXHIBITS
EXHIBIT A: Certain Definitions
EXHIBIT B: Form of Noncompetition Agreement
EXHIBIT C: Form of Employment Agreement
EXHIBIT D: Form of General Release
EXHIBIT E: Form of opinion letter from Best Best Xxxxxxx LLP
iv.
Exhibit 2.1
STOCK ACQUISITION AGREEMENT
THIS STOCK ACQUISITION AGREEMENT is entered into as of January 28,
2000 by and among ACTIVE VOICE CORPORATION, a Washington corporation ("Active
Voice"), PHONESOFT INC., a California corporation ("PhoneSoft"), and the
following parties (the "Shareholders"): XXXX XXXXXX, XXXX XXXX, XXXXXXX
XXXXXXX and XXXXXX XXXX, as trustee of the Xxxxxx X. Xxxx Trust dated June
28, 1996. Certain capitalized terms used in this Agreement are defined on
EXHIBIT A.
RECITALS
A. The Shareholders own 100,000 shares and options to purchase an
additional 32,438 shares of the common stock of PhoneSoft (the "PhoneSoft
Shares"), which constitute all of the outstanding securities of PhoneSoft.
B. The Shareholders wish to sell the PhoneSoft Shares to Active
Voice on the terms set forth in this Agreement.
AGREEMENT
Active Voice, PhoneSoft and the Shareholders, intending to be
legally bound, agree as follows:
SECTION 1. ACQUISITION OF PHONESOFT SHARES; RELATED TRANSACTIONS
1.1 ACQUISITION OF PHONESOFT SHARES. At the Closing, the
Shareholders shall sell, assign, transfer and deliver the PhoneSoft Shares to
Active Voice, and Active Voice shall acquire the PhoneSoft Shares from the
Shareholders, on the terms and subject to the conditions set forth in this
Agreement.
1.2 CONSIDERATION. Active Voice shall acquire the PhoneSoft shares
in exchange for 85,083 shares of the common stock of Active Voice,
appropriately adjusted for the stock split described below (the "Exchange
Shares"). Active Voice shall issue 90% of the Exchange Shares to the
Shareholders at the Closing, in the following proportions (subject to
adjustment for the stock split):
Xxxx Xxxxxx 66,031 shares (86.23%)
Xxxx Xxxx 9,962 shares (13.01%)
Xxxxxxx Xxxxxxx 291 shares (0.38%)
Xxxxxx Xxxx (trustee) 291 shares (0.38%)
Subject to the right of set-off provided for in Section 10.3, Active Voice
shall issue the balance of the Exchange Shares (the "Holdback Shares") to the
Shareholders on the date which is thirty (30) days after the publication of
the combined financial statements of PhoneSoft and Active Voice, but in no
event later than one (1) year from the Closing Date (the "Holdback
Termination Date"). Active Voice has announced a two-for-one stock split that
is scheduled to become
effective on March 8, 2000. In the event the Closing occurs after the
effective date of the stock split, then the number of Exchange shares shall
be increased by a factor of two.
1.3 CLOSING
(a) The closing of the sale of the PhoneSoft Shares to Active
Voice (the "Closing") shall take place at the offices of Active Voice at
10:00 a.m. on February 29, 2000 (or at such other place or time as Active
Voice and the Agent may jointly designate). For purposes of this Agreement:
"Scheduled Closing Time" shall mean the time and date as of which the Closing
is required to take place pursuant to this Section 1.3(a); and "Closing Date"
shall mean the time and date as of which the Closing actually takes place.
(b) At the Closing:
(i) the Shareholders shall deliver to Active Voice
the stock certificates representing the PhoneSoft Shares, duly endorsed (or
accompanied by duly executed stock powers), and Active Voice shall issue
76,575 of the Exchange Shares to the Shareholders as contemplated by Section
1.2;
(ii) Xxxx Xxxxxx and Xxxx Xxxx shall execute and
deliver to Active Voice and PhoneSoft a Noncompetition Agreement in the form
of EXHIBIT B;
(iii) Xxxx Xxxxxx and Active Voice shall execute and
deliver an Employment Agreement in the form of EXHIBIT C-1;
(iv) Xxxx Xxxx and Active Voice shall execute and
deliver an Employment Agreement in the form of EXHIBIT C-2;
(v) Xxxxxxx Xxxxxxx and Active Voice shall execute
and deliver an Employment Agreement in the form of EXHIBIT C-3;
(vi) the Shareholders shall execute and deliver to
Active Voice and PhoneSoft a General Release in the form of EXHIBIT D;
(vii) Xxxx Xxxxxx shall execute and deliver to
Active Voice and PhoneSoft a certificate (the "Closing Certificate") stating
that (A) each of the representations and warranties made by PhoneSoft and
Xxxx Xxxxxx in this Agreement was accurate in all respects as of the date of
this Agreement, (B) except as expressly set forth in the Closing Certificate,
each of the representations and warranties made by PhoneSoft and Xxxx Xxxxxx
in this Agreement is accurate in all respects as of the Closing Date as if
made on the Closing Date, (C) each of the covenants and obligations that
PhoneSoft and the Shareholders are required to have complied with or
performed pursuant to this Agreement at or prior to the Closing has been duly
complied with and performed in all respects, and (D) except as expressly set
forth in the Closing Certificate, each of the conditions set forth in
Sections 7.5, 7.7, 7.8, 7.9 and 7.10 has been satisfied in all respects; and
(viii) the Shareholders shall resign from their
positions as directors and officers of PhoneSoft.
2.
1.4 TAX CONSEQUENCES. For federal income tax purposes, the
Transaction is intended to constitute a reorganization within the meaning of
Section 368(a)(1)(B) of the Code.
1.5 ACCOUNTING TREATMENT. For accounting purposes, the Transaction
is intended to be treated as a "pooling of interests." In that connection,
the Shareholders acknowledge that the Exchange Shares will be subject to
certain restrictions on transfer set forth in Section 11.19 of this Agreement.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF PHONESOFT AND XXXX XXXXXX.
Phonesoft and Xxxx Xxxxxx jointly and severally represent and
warrant, to and for the benefit of the Indemnitees, as follows:
2.1 DUE ORGANIZATION; NO SUBSIDIARIES; ETC.
(a) PhoneSoft is a corporation duly organized, validly
existing and in good standing under the laws of the State of California and
has all necessary power and authority:
(i) to conduct its business in the manner in which
its business is currently being conducted;
(ii) to own and use its assets in the manner in
which its assets are currently owned; and
(iii) to perform its obligations under all PhoneSoft
Contracts.
(b) PhoneSoft has never conducted any business under or
otherwise used, for any purpose or in any jurisdiction, any fictitious name,
assumed name, trade name or other name, other than the name "PhoneSoft."
(c) PhoneSoft is not required to be qualified, authorized,
registered or licensed to do business as a foreign corporation in any
jurisdiction other than the State of California and such other jurisdictions
where the failure to so qualify would not have a material adverse effect on
its assets or business, except as stated in Part 2.1 of the Disclosure
Schedule. PhoneSoft is in good standing as a foreign corporation in each of
the jurisdictions identified in Part 2.1 of the Disclosure Schedule.
(d) Neither PhoneSoft nor any of its shareholders has ever
approved, or commenced any proceeding or made any election contemplating, the
dissolution or liquidation of PhoneSoft or the winding up or cessation of
PhoneSoft's business or affairs.
(e) PhoneSoft has no subsidiaries, and PhoneSoft has never
owned, beneficially or otherwise, any shares or other securities of, or any
direct or indirect interest of any nature in, any Entity.
3.
2.2 CERTIFICATE OF INCORPORATION AND BYLAWS; RECORDS
(a) PhoneSoft has delivered or shall deliver prior to the
Closing to Active Voice accurate and complete copies of:
(i) PhoneSoft's certificate of incorporation and
bylaws, including all amendments thereto; and
(ii) the minutes and other records of the meetings
and other proceedings (including any actions taken by written consent or
otherwise without a meeting) of the shareholders, the board of directors, and
all committees of the board of directors of PhoneSoft.
There have been no meetings or other proceedings of the shareholders, the
board of directors, or any committee of the board of directors of PhoneSoft
that are not fully reflected in such minutes or other records.
(b) There has not been any violation of any of the provisions
of PhoneSoft's certificate of incorporation or bylaws or of any resolution
adopted by PhoneSoft's shareholders, PhoneSoft's board of directors or any
committee of PhoneSoft's board of directors; and no event has occurred, and
no condition or circumstance exists, that might (with or without notice or
lapse of time) constitute or result directly or indirectly in such a
violation.
(c) The books of account, stock records, minute books and
other records of PhoneSoft shall be accurate, up-to-date and complete in all
material respects as of the date of Closing.
2.3 CAPITALIZATION, ETC.
(a) The authorized capital stock of PhoneSoft consists of:
10,000,000 shares of common stock having a par value of $.01 per share, of
which 100,000 shares have been issued and are outstanding.
(b) The Shareholders have, and Active Voice will acquire at
the Closing, good and valid title to the PhoneSoft Shares free and clear of
any Encumbrances. Of the PhoneSoft Shares:
(i) Xxxx Xxxxxx owns 100,000 shares, and holds a
fully vested option to purchase an additional 14,200 shares at $.05 per share;
(ii) Xxxx Xxxx owns zero shares, and holds a fully
vested option to purchase 17,238 shares at $.05 per share;
(iii) Xxxxxxx Xxxxxxx owns zero shares, and holds a
fully vested option to purchase 500 shares at $2.00 per share; and
4.
(iv) Xxxxxx Xxxx (trustee) owns zero shares, and
holds a fully vested option to purchase 500 shares at $2.00 per share.
(c) All of the PhoneSoft Shares (i) have been duly authorized
and validly issued, (ii) are fully paid and non-assessable, and (iii) have
been issued in full compliance with all applicable securities laws and other
applicable Legal Requirements. The Shareholders have delivered or shall
deliver prior to the Closing to Active Voice accurate and complete copies of
the stock certificates evidencing the PhoneSoft Shares.
(d) Except for the options described in Section 2.3(b), there
is no:
(i) outstanding subscription, option, call, warrant
or right (whether or not currently exercisable) to acquire any shares of the
capital stock or other securities of PhoneSoft;
(ii) outstanding security, instrument or obligation
that is or may become convertible into or exchangeable for any shares of the
capital stock or other securities of PhoneSoft;
(iii) Contract under which PhoneSoft is or may
become obligated to sell or otherwise issue any shares of its capital stock
or any other securities; or
(iv) condition or circumstance that may directly or
indirectly give rise to or provide a basis for the assertion of a claim by
any Person to the effect that such Person is entitled to acquire or receive
any shares of capital stock or other securities of PhoneSoft.
(e) PhoneSoft has never repurchased, redeemed or otherwise
reacquired any shares of capital stock or other securities.
2.4 FINANCIAL STATEMENTS. PhoneSoft has delivered to Active Voice
the unaudited balance sheet of PhoneSoft as of December 31, 1999 (the "1999
Balance Sheet"). Except as disclosed in Part 2.4 of the Disclosure Schedule,
the 1999 Balance Sheet fairly presents the financial condition of Phonesoft
as of the date thereof.
2.5 ABSENCE OF CHANGES. Except as set forth in Part 2.5 of the
Disclosure Schedule, since December 31, 1999:
(a) there has not been any adverse change in PhoneSoft's
business, condition, assets, liabilities, operations, financial performance
or net income (or in any aspect or portion thereof), and no event has
occurred that might have an adverse effect on PhoneSoft's business,
condition, assets, liabilities, operations, financial performance or net
income except for general events or developments occurring in the economy or
Phonesoft's industry, including without limitation, any announcements or
actions taken by Phonesoft competitors;
(b) there has not been any loss, damage or destruction to, or
any interruption in the use of, any of PhoneSoft's assets (whether or not
covered by insurance);
5.
(c) PhoneSoft has not (i) declared, accrued, set aside or paid
any dividend or made any other distribution in respect of any shares of
capital stock, or (ii) repurchased, redeemed or otherwise reacquired any
shares of capital stock or other securities;
(d) PhoneSoft has not sold or otherwise issued any shares of
capital stock or any other securities;
(e) PhoneSoft has not amended its certificate of incorporation
or bylaws and has not effected or been a party to any Acquisition
Transaction, recapitalization, reclassification of shares, stock split,
reverse stock split or similar transaction;
(f) PhoneSoft has not purchased or otherwise acquired any
asset from any other Person, except for supplies acquired by PhoneSoft in the
Ordinary Course of Business;
(g) PhoneSoft has not leased or licensed any asset from any
other Person;
(h) PhoneSoft has not made any capital expenditure;
(i) PhoneSoft has not sold or otherwise transferred, and has
not leased or licensed, any asset to any other Person except for products
sold by PhoneSoft in the Ordinary Course of Business;
(j) PhoneSoft has not written off as uncollectible, or
established any extraordinary reserve with respect to, any account receivable
or other indebtedness;
(k) PhoneSoft has not pledged or hypothecated any of its
assets or otherwise permitted any of its assets to become subject to any
Encumbrance;
(l) PhoneSoft has not made any loan or advance to any other
Person;
(m) PhoneSoft has not (i) established or adopted any Employee
Benefit Plan, or (ii) paid any bonus or made any profit-sharing or similar
payment to, or increased the amount of the wages, salary, commissions, fringe
benefits or other compensation or remuneration payable to, any of its
directors, officers or employees;
(n) PhoneSoft has not entered into, and neither PhoneSoft nor
any of the assets owned or used by PhoneSoft has become bound by, any
Contract that is not in the Ordinary Course of Business;
(o) no Contract by which PhoneSoft or any of the assets owned
or used by PhoneSoft is or was bound, or under which PhoneSoft has or had any
rights or interest, has been amended or terminated;
(p) PhoneSoft has not incurred, assumed or otherwise become
subject to any Liability, other than accounts payable (of the type required
to be reflected as current liabilities in the "liabilities" column of a
balance sheet prepared in accordance with GAAP) incurred by PhoneSoft in the
Ordinary Course of Business;
6.
(q) PhoneSoft has not discharged any Encumbrance or discharged
or paid any indebtedness or other Liability, except for accounts payable that
(i) are reflected as current liabilities in the "liabilities" column of the
1999 Balance Sheet or have been incurred by PhoneSoft since December 31, 1999
in the Ordinary Course of Business, and (ii) have been discharged or paid in
the Ordinary Course of Business;
(r) PhoneSoft has not forgiven any debt or otherwise released
or waived any right or claim;
(s) PhoneSoft has not changed any of its methods of accounting
or accounting practices in any respect;
(t) PhoneSoft has not entered into any transaction or taken
any other action outside the Ordinary Course of Business; and
(u) PhoneSoft has not agreed, committed or offered (in writing
or otherwise), and has not attempted, to take any of the actions referred to
in clauses "(c)" through "(t)" above.
2.6 TITLE TO ASSETS
(a) PhoneSoft owns, and has good, valid and marketable title
to all assets reflected on the 1999 Balance Sheet or otherwise described in
this Agreement. Except as set forth in Part 2.6 of the Disclosure Schedule,
all of said assets are owned by PhoneSoft free and clear of any Encumbrances.
(b) Part 2.6 of the Disclosure Schedule identifies all assets
that are being leased or licensed to PhoneSoft.
2.7 BANK ACCOUNTS. PhoneSoft has disclosed to Active Voice, with
respect to each account maintained by or for the benefit of PhoneSoft at any
bank or other financial institution:
(a) the name and location of the institution at which such
account is maintained;
(b) the name in which such account is maintained and the
account number of such account;
(c) a description of such account and the purpose for which
such account is used;
(d) the current balance in such account;
(e) the rate of interest being earned on the funds in such
account; and
(f) the names of all individuals authorized to draw on or make
withdrawals from such account.
7.
There are no safe deposit boxes or similar arrangements maintained by or for
the benefit of PhoneSoft.
2.8 RECEIVABLES. All accounts receivable, notes receivable and
other receivables of PhoneSoft represent valid obligations of customers of
PhoneSoft arising from bona fide transactions entered into in the Ordinary
Course of Business.
2.9 PROPRIETARY ASSETS.
(a) Part 2.9(a)(1) of the Disclosure Schedule identifies and
provides a brief description of all Proprietary Assets owned by PhoneSoft.
Part 2.9(a)(2) of the Disclosure Schedule identifies and provides a brief
description of each Proprietary Asset that is owned by any other Person and
that is licensed to or used by PhoneSoft (except for any Proprietary Asset
that is licensed to PhoneSoft under any third party software license that (i)
is generally available to the public, and (ii) imposes no future monetary
obligation on PhoneSoft) and identifies the license agreement or other
agreement under which such Proprietary Asset is being licensed to or used by
PhoneSoft. PhoneSoft has good and valid title to all of the Proprietary
Assets identified in Part 2.9(a)(1) of the Disclosure Schedule, free of any
Encumbrances, and has a valid right to use and otherwise exploit, and to
license others to use and otherwise exploit, all Proprietary Assets
identified in Part 2.9(a)(2) of the Disclosure Schedule. Except as set forth
in Part 2.9(a)(3) of the Disclosure Schedule, PhoneSoft is not obligated to
make any payment to any Person for the use or other exploitation of any
Proprietary Asset. Except as set forth in Part 2.9(a)(4) of the Disclosure
Schedule, PhoneSoft is free to use, modify, copy, distribute, sell, license
or otherwise exploit each of PhoneSoft Proprietary Assets on an exclusive
basis (other than Proprietary Assets consisting of software licensed to
PhoneSoft under third party licenses generally available to the public, with
respect to which PhoneSoft's rights are not exclusive). Except as set forth
in Part 2.9(a)(5) of the Disclosure Schedule, no action, suit, proceeding,
hearing, investigation, charge, complaint, claim or demand is pending or to
the Knowledge of Phonesoft or Xxxx Xxxxxx is threatened which challenges the
legality, validity, enforceability, use, or ownership of any Proprietary
Asset, and PhoneSoft has never agreed to indemnify any Person for or against
any interference, infringement, misappropriation, or other conflict with
respect to any Proprietary Asset.
(b) PhoneSoft has taken all reasonably prudent measures and
precautions necessary to protect and maintain the confidentiality, value and
secrecy of all PhoneSoft Proprietary Assets (except PhoneSoft Proprietary
Assets whose value would be unimpaired by public disclosure) and otherwise to
maintain and protect the value of all PhoneSoft Proprietary Assets. Except as
set forth on Part 2.9(b) of the Disclosure Schedule, other than Phonesoft's
directors, officers and employees, PhoneSoft has not disclosed or delivered
or permitted to be disclosed or delivered to any Person, and no Person (other
than PhoneSoft) has access to or has any rights with respect to, the source
code, or any portion or aspect of the source code, of any PhoneSoft
Proprietary Asset.
(c) All patents, trademarks, service marks and copyrights that
are registered with any Governmental Body and held by PhoneSoft are valid and
subsisting. None of PhoneSoft Proprietary Assets infringes or conflicts with
any Proprietary Asset owned or used by any other Person. PhoneSoft is not
infringing, misappropriating or making any unlawful use of,
8.
and PhoneSoft has not at any time infringed, misappropriated or made any
unlawful use of, or received any written notice or other communication of any
actual, alleged, possible or potential infringement, misappropriation or
unlawful use of, any Proprietary Asset owned or used by any other Person. To
the best of the Knowledge of PhoneSoft and Xxxx Xxxxxx, no other Person is
infringing, misappropriating or making any unlawful use of, and no
Proprietary Asset owned or used by any other Person infringes or conflicts
with, any PhoneSoft Proprietary Asset.
(d) The Proprietary Assets identified in Part 2.9 of the
Disclosure Schedule constitute all the Proprietary Assets necessary to enable
PhoneSoft to conduct its business in the manner in which such business is
being conducted. PhoneSoft has not licensed any PhoneSoft Proprietary Assets
to any Person with any exclusive terms whatsoever. PhoneSoft has not entered
into any covenant not to compete or Contract limiting its ability to exploit
fully any PhoneSoft Proprietary Assets or to transact business in any market
or geographical area or with any Person.
(e) Except as set forth in Part 2.9(e) of the Disclosure
Schedule, PhoneSoft has not entered into and is not bound by any Contract
under which any Person has the right to modify, distribute or license any
Proprietary Asset. Except as set forth on Part 2.9(e) of the Disclosure
Schedule, PhoneSoft has not disclosed or delivered to any Person, or
permitted the disclosure or delivery to any Person, of the source code, or
any portion or aspect of the source code, or any proprietary information or
algorithm contained in any source code, of any Proprietary Asset. To the
knowledge of Phonesoft or Xxxx Xxxxxx, no event has occurred, and no
circumstance or condition exists, that (with or without notice or lapse of
time) will, or could reasonably be expected to, result in the disclosure or
delivery to any Person of the source code, or any portion or aspect of the
source code, or any proprietary information or algorithm contained in any
source code, of any Proprietary Asset.
(f) Reasonably promptly following the execution of this
Agreement, but subject to the execution by Active Voice of an appropriate
non-disclosure agreement, PhoneSoft shall deliver to Active Voice correct and
complete copies of all Proprietary Assets (as amended to date) and shall make
available to Active Voice correct and complete copies of all other written
documentation evidencing ownership and prosecution (if applicable) of each
such item.
2.10 CONTRACTS. PhoneSoft has delivered or shall deliver prior to
the date of Closing to Active Voice accurate and complete copies of all
material PhoneSoft Contracts, including all amendments thereto.
(a) Each PhoneSoft Contract is valid and in full force and
effect, and is enforceable by PhoneSoft in accordance with its terms.
(b) Except as set forth in Part 2.10 of the Disclosure
Schedule:
(i) To the knowledge of Phonesoft or Xxxx Xxxxxx, no
Person has violated or breached, or declared or committed any default under,
any PhoneSoft Contract;
(ii) To the knowledge of Phonesoft or Xxxx Xxxxxx,
no event has occurred, and no circumstance or condition exists, that might
(with or without notice or lapse of time) (A) result in a violation or breach
of any of the provisions of any PhoneSoft Contract,
9.
(B) give any Person the right to declare a default or exercise any remedy
under any PhoneSoft Contract, (C) give any Person the right to accelerate the
maturity or performance of any PhoneSoft Contract, or (D) give any Person the
right to cancel, terminate or modify any PhoneSoft Contract;
(iii) Phonesoft has not received any written notice
or other communication (in writing or otherwise) regarding any actual,
alleged, possible or potential violation or breach of, or default under, any
PhoneSoft Contract; and
(iv) PhoneSoft has not waived any of its rights
under any PhoneSoft Contract.
2.11 LIABILITIES. PhoneSoft has no Liabilities, except for:
(a) liabilities identified as such in the "liabilities" column
of the 1999 Balance Sheet;
(b) accounts payable (of the type required to be reflected as
current liabilities in the "liabilities" column of a balance sheet prepared
in accordance with GAAP) incurred by PhoneSoft in the Ordinary Course of
Business since December 31, 1999; and
(c) PhoneSoft's obligations under the PhoneSoft Contracts to
the extent that the existence of such obligations is ascertainable solely by
reference to such Contracts; PROVIDED that except as disclosed on Part
2.11(c) of the Disclosure Schedule, Phonesoft has no Liabilities with respect
to sold products.
2.12 COMPLIANCE WITH LEGAL REQUIREMENTS. Except as set forth in
Part 2.12 of the Disclosure Schedule:
(a) PhoneSoft is in full compliance with the material
provisions of each Legal Requirement that is applicable to it or to the
conduct of its business or the ownership or use of any of its assets,
including without limitation to the withholding and payment of payroll taxes;
(b) To the Knowledge of Phonesoft or Xxxx Xxxxxx, no event has
occurred, and no condition or circumstance exists, that might (with or
without notice or lapse of time) constitute or result directly or indirectly
in a violation by PhoneSoft of, or a failure on the part of PhoneSoft to
comply with, any Legal Requirement; and
(c) PhoneSoft has not received, at any time, any written
notice or other communication from any Governmental Body or any other Person
regarding (i) any actual, alleged, possible or potential violation of, or
failure to comply with, any Legal Requirement, or (ii) any actual, alleged,
possible or potential obligation on the part of PhoneSoft to undertake, or to
bear all or any portion of the cost of, any cleanup or any remedial,
corrective or response action of any nature.
10.
2.13 TAX MATTERS
(a) PhoneSoft is a Subchapter S corporation. Each Tax required
to have been paid, or claimed by any Governmental Body to be payable, by or
with respect to PhoneSoft (whether pursuant to any Tax Return or otherwise)
has been duly paid in full or on a timely basis. Any Tax required to have
been withheld or collected by or with respect to PhoneSoft has been duly
withheld and collected; and (to the extent required) each such Tax has been
paid to the appropriate Governmental Body.
(b) All Tax Returns required to be filed by or with respect to
PhoneSoft: (i) have been or will be filed when due, and (ii) have been, or
will be when filed, accurately and completely prepared in full compliance
with all applicable Legal Requirements. All amounts shown on such Tax Returns
to be due on or before the Closing Date, and all amounts otherwise payable in
connection with such Tax Returns on or before the Closing Date, have been or
will be paid. PhoneSoft has delivered to Active Voice accurate and complete
copies of all Tax Returns filed since December 31, 1996.
(c) PhoneSoft will distribute to its Shareholders, from its
current cash reserves, only that amount of cash required to pay all Taxes for
the period from December 31, 1998 through the Closing Date, and PhoneSoft
will disclose the dollar amount of such distribution to Active Voice prior to
the Closing Date.
(d) PhoneSoft has delivered to Active Voice accurate and
complete copies of all audit reports and similar documents (to which
PhoneSoft has access) relating to PhoneSoft Tax Returns. No extension or
waiver of the limitation period applicable to any of the PhoneSoft Tax
Returns has been granted, and no such extension or waiver has been requested.
(e) No claim or other Proceeding is pending or to the
Knowledge of PhoneSoft or Xxxx Xxxxxx has been threatened against or with
respect to any of the Companies in respect of any Tax. There are no
unsatisfied Liabilities for Taxes (including liabilities for interest,
additions to tax and penalties thereon and related expenses) with respect to
any notice of deficiency or similar document received by PhoneSoft or any
Shareholder.
2.14 BENEFIT PLANS. Except as set forth on Part 2.14 of the
Disclosure Schedule, PhoneSoft has not ever established, adopted, maintained,
sponsored, contributed to, participated in or incurred any Liability with
respect to any Employee Benefit Plan.
2.15 RELATED PARTY TRANSACTIONS
(a) Except for the unwritten lease of the premises located at
00000 Xxxxxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx, and owned by Xxxx Xxxxxx, no
Related Party has, and no Related Party has at any time had, any direct or
indirect interest of any nature in any asset used in or otherwise relating to
the business of any of the Companies. Said lease will remain in effect after
the Closing at a rental not to exceed $1,800 per month until terminated by
written notice of Active Voice.
(b) No Related Party has any claim or right against PhoneSoft.
11.
2.16 PROCEEDINGS; ORDERS
(a) There is no pending Proceeding, and to the Knowledge of
Phonesoft or Xxxx Xxxxxx, no Person has threatened to commence any Proceeding:
(i) that involves PhoneSoft or that otherwise
relates to or might affect PhoneSoft's business or any of the assets owned or
used by PhoneSoft (whether or not PhoneSoft is named as a party thereto); or
(ii) that challenges, or that may have the effect of
preventing, delaying, making illegal or otherwise interfering with, any of
the Transactions.
(b) To the Knowledge of Phonesoft or Xxxx Xxxxxx, no event has
occurred, and no claim, dispute or other condition or circumstance exists,
that might directly or indirectly give rise to or serve as a basis for the
commencement of any such Proceeding.
(c) There is no Order to which PhoneSoft, or any of the assets
owned or used by PhoneSoft, is subject; and none of the Shareholders is
subject to any Order that relates to PhoneSoft's business or to any of the
assets owned or used by PhoneSoft.
2.17 AUTHORITY; BINDING NATURE OF AGREEMENTS. PhoneSoft has the
absolute and unrestricted right, power and authority to enter into and to
perform its obligations under this Agreement; and the execution, delivery and
performance by PhoneSoft of this Agreement have been duly authorized by all
necessary action on the part of PhoneSoft and its shareholders, board of
directors and officers. This Agreement constitutes the legal, valid and
binding obligation of PhoneSoft, enforceable against PhoneSoft in accordance
with its terms.
2.18 NON-CONTRAVENTION; CONSENTS. Except as set forth on Part 2.18
of the Disclosure Schedule, neither the execution and delivery of any of the
Transactional Agreements, nor the consummation or performance of any of the
Transactions, will directly or indirectly (with or without notice or lapse of
time):
(a) contravene, conflict with or result in a violation of (i)
any of the provisions of PhoneSoft's certificate of incorporation or bylaws,
or (ii) any resolution adopted by PhoneSoft's shareholders, PhoneSoft's board
of directors or any committee of PhoneSoft's board of directors;
(b) contravene, conflict with or result in a violation of, or
give any Governmental Body or other Person the right to challenge any of the
Transactions or to exercise any remedy or obtain any relief under, any Legal
Requirement or any Order to which PhoneSoft or any of the Shareholders, or
any of the assets owned or used by PhoneSoft, is subject;
(c) cause PhoneSoft, Active Voice or any affiliate of Active
Voice to become subject to, or to become liable for the payment of, any Tax;
(d) cause any of the assets owned or used by PhoneSoft to be
reassessed or revalued by any taxing authority or other Governmental Body;
12.
(e) contravene, conflict with or result in a violation or
breach of, or result in a default under, any provision of any PhoneSoft
Contract;
(f) give any Person the right to (i) declare a default or
exercise any remedy under any PhoneSoft Contract, (ii) accelerate the
maturity or performance of any PhoneSoft Contract, or (iii) cancel, terminate
or modify any PhoneSoft Contract;
(g) contravene, conflict with or result in a violation or
breach of or a default under any provision of, or give any Person the right
to declare a default under, any Contract to which any of the Shareholders is
a party or by which any of the Shareholders is bound; or
(h) result in the imposition or creation of any Encumbrance
upon or with respect to any asset owned or used by PhoneSoft.
Except as set forth on Part 2.18 of the Disclosure Schedule, neither
PhoneSoft nor any of the Shareholders was, is or will be required to make any
filing with or give any notice to, or to obtain any Consent from, any Person
in connection with the execution and delivery of any of the Transactional
Agreements or the consummation or performance of any of the Transactions.
2.19 BROKERS. Neither PhoneSoft nor any of the Shareholders has
agreed or become obligated to pay, or has taken any action that might result
in any Person claiming to be entitled to receive, any brokerage commission,
finder's fee or similar commission or fee in connection with any of the
Transactions.
2.20 FULL DISCLOSURE
(a) To the Knowledge of Phonesoft and Xxxx Xxxxxx, none of the
Transactional Agreements contains or will contain any untrue statement of
fact; and none of the Transactional Agreements omits or will omit to state
any fact necessary to make any of the representations, warranties or other
statements or information contained therein not misleading.
(b) There is no fact within the Knowledge of PhoneSoft or Xxxx
Xxxxxx (other than publicly known facts relating exclusively to political or
economic matters of general applicability) that (i) may have an adverse
effect on PhoneSoft's business, condition, assets, liabilities, operations,
financial performance or net income (or on any aspect or portion thereof) or
on the ability of PhoneSoft or any of the Shareholders to comply with or
perform any covenant or obligation under any of the Transactional Agreements,
or (ii) may have the effect of preventing, delaying, making illegal or
otherwise interfering with any of the Transactions.
(c) PhoneSoft and Xxxx Xxxxxx have provided Active Voice and
Active Voice's Representatives with full and complete access to all of
PhoneSoft's records and other documents and data.
13.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS
Each of the Shareholders, severally and not jointly, represents and
warrants, to and for the benefit of the Indemnitees, as follows:
3.1 AUTHORITY; BINDING NATURE OF AGREEMENTS
(a) The Shareholder has the absolute and unrestricted right,
power and capacity to enter into and to perform such Shareholder's
obligations under each of the Transactional Agreements to which such
Shareholder is or may become a party. This Agreement constitutes the legal,
valid and binding obligation of the Shareholder, enforceable against such
Shareholder in accordance with its terms. Upon the execution of each of the
other Transactional Agreements at the Closing, each of such other
Transactional Agreements will constitute the legal, valid and binding
obligation of the Shareholder who is a party thereto, and will be enforceable
against such Shareholder in accordance with its terms.
(b) The spouse of the Shareholder has the absolute and
unrestricted right, power and capacity to execute and deliver and to perform
his or her obligations under the Spousal Consents being executed by such
spouse. Said Spousal Consent constitutes such spouse's legal, valid and
binding obligations, enforceable against him or her in accordance with their
terms.
(c) The Agent has the unrestricted right, power, authority and
capacity to act for and bind the Shareholder with respect to all matters
relating to the Transactional Agreements and the Transactions.
3.2 SHAREHOLDER
(a) The Shareholder has the capacity and financial capability
to comply with and perform all of such Shareholder's covenants and
obligations under each of the Transactional Agreements to which such
Shareholder is or may become a party.
(b) The Shareholder is not subject to any Order that may have
an adverse effect on such Shareholder's ability to comply with or perform any
of such Shareholder's covenants or obligations under any of the Transactional
Agreements.
(c) There is no Proceeding pending, and to the Knowledge of
the Shareholder, no Person has threatened to commence any Proceeding, that
may have an adverse effect on the ability of the Shareholder to comply with
or perform any of such Shareholder's covenants or obligations under any of
the Transactional Agreements. No event has occurred, and no claim, dispute or
other condition or circumstance exists, that might directly or indirectly
give rise to or serve as a basis for the commencement of any such Proceeding.
3.3 INVESTMENT REPRESENTATIONS.
(a) The Shareholder has reviewed the publicly available
information concerning Active Voice, including its most recent annual and
quarterly reports, is aware of Active Voice's business affairs and financial
condition and has acquired sufficient information
14.
about Active Voice to reach an informed and knowledgeable decision to acquire
the Exchange Shares. The Shareholder is acquiring the Exchange Shares for
investment for such Shareholder's own account only and not with a view to, or
for resale in connection with, any "distribution" thereof within the meaning
of the Securities Act of 1933 (the "Act").
(b) The Shareholder understands that the Exchange Shares have
not been registered under the Act by reason of a specific exemption
therefrom, which exemption depends upon, among other things, the bona fide
nature of the Shareholder's investment intent as expressed herein.
(c) The Shareholder further acknowledges and understands that
the Exchange Shares are subject to restrictions on transfer set forth in
Section 11.19, and that the Exchange Shares must be held indefinitely unless
the Exchange Shares are subsequently registered under the Act or an exemption
from such registration is available. The Shareholder further acknowledges and
understands that Active Voice is under no obligation to register the Exchange
Shares. The Shareholder understands that the certificate evidencing the
Exchange Shares will be imprinted with a legend which prohibits the transfer
of the Exchange Shares unless the Exchange Shares is registered or such
registration is not required in the opinion of counsel for Active Voice.
(d) The Shareholder has either (i) a preexisting personal or
business relationship with Active Voice or any of its officers, directors or
controlling persons, or (ii) the capacity to protect his or her own interests
in connection with the acquisition of the Exchange Shares by virtue of his or
her own business or financial expertise or of a professional advisor to such
Shareholder who is unaffiliated with and who is not compensated by Active
Voice or any of its affiliates, directly or indirectly.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Active Voice represents and warrants, to and for the benefit of the
Shareholders, as follows:
4.1 ACQUISITION OF PHONESOFT SHARES. Active Voice is not acquiring
the PhoneSoft Shares with the current intention of making a public
distribution thereof.
4.2 AUTHORITY; BINDING NATURE OF AGREEMENT. Upon the adoption of
appropriate resolutions by Active Voice's board of directors:
(a) Active Voice will have the absolute and unrestricted
right, power and authority to enter into and perform its obligations under
this Agreement;
(b) the execution, delivery and performance of this Agreement
by Active Voice will have been duly authorized by all necessary action on the
part of Active Voice and its board of directors; and
(c) this Agreement will constitute the legal, valid and
binding obligation of Active Voice, enforceable against Active Voice in
accordance with its terms.
15.
4.3 ACTIVE VOICE SHARES.
(a) Active Voice has a duly authorized capital of comprised of
10,000,000 shares of common stock, of which approximately 5,059,780 shares
were issued and outstanding on January 18, 2000, and 2,000,000 shares of
"blank check" preferred stock, none of which are issued or outstanding. All
of its presently outstanding shares of common stock are validly issued, fully
paid and non-assessable.
(b) The Exchange Shares will be duly authorized and validly
issued and fully paid and non-assessable shares of the common stock of Active
Voice, and no Active Voice shareholder has an preemptive right of
subscription or purchase in respect thereof. Subject to the truthfulness of
the Shareholders' representations in Sections 3.2 and 3.3, the Exchange
Shares will be issued in compliance with all federal and state securities
laws applicable to the issuance of the Exchange Shares.
SECTION 5. PRE-CLOSING COVENANTS OF PHONESOFT AND SHAREHOLDERS
5.1 ACCESS AND INVESTIGATION. PhoneSoft and the Shareholders shall
ensure that, at all times during the Pre-Closing Period:
(a) PhoneSoft and its Representatives provide Active Voice and
its Representatives with free and complete access to PhoneSoft's
Representatives, personnel and assets and to all existing books, records, Tax
Returns, work papers and other documents and information relating to the
Companies;
(b) PhoneSoft and its Representatives provide Active Voice and
its Representatives with such copies of existing books, records, Tax Returns,
work papers and other documents and information relating to the Companies as
Active Voice may request in good faith; and
(c) PhoneSoft and its Representatives compile and provide
Active Voice and its Representations with such additional financial,
operating and other data and information regarding the Companies as Active
Voice may request in good faith.
5.2 CONDUCT OF BUSINESS. Except as contemplated by this Agreement
and except as may be necessary to carry out the transactions contemplated
herein, PhoneSoft and the Seller Shareholders shall not, without Active
Voice's consent:
(a) permit the adoption of any amendment to the Company's
certificate of incorporation or bylaws;
(b) permit the Company to issue any capital stock;
(c) permit the Company to merge or combine with any
unaffiliated entity;
(d) permit the Company to pay any dividends to its
shareholders;
16.
(e) permit the Company to enter into any material transaction
outside the Ordinary Course of Business; or
(f) cause the Company to conduct its business in a manner that
departs materially from the manner in which such business was being conducted
prior to the date of this Agreement;
PROVIDED, HOWEVER, that, notwithstanding anything to the
contrary contained in this Section 5.2 or elsewhere in this Agreement: (i)
PhoneSoft shall be permitted to distribute cash from current reserves in
respect of Taxes in accordance with Section 2.13(c); and (ii) PhoneSoft shall
be permitted to issue stock upon the exercise of options in accordance with
Section 7.10.
5.3 NO NEGOTIATION. PhoneSoft and the Shareholders shall ensure
that, during the Pre-Closing Period, neither PhoneSoft nor any of PhoneSoft's
Representatives directly or indirectly:
(a) solicits or encourages the initiation of any inquiry,
proposal or offer from any Person (other than Active Voice) relating to any
Acquisition Transaction;
(b) participates in any discussions or negotiations with, or
provides any non-public information to, any Person (other than Active Voice)
relating to any Acquisition Proposal; or
(c) considers the merits of any unsolicited inquiry, proposal
or offer from any Person (other than Active Voice) relating to any
Acquisition Transaction.
5.4 BEST EFFORTS. During the Pre-Closing Period, PhoneSoft and the
Shareholders shall use their Best Efforts to cause the conditions set forth
in Sections 7 and 8 to be satisfied on a timely basis
5.5 CONFIDENTIALITY. PhoneSoft and the Shareholders shall ensure
that, during the Pre-Closing Period:
(a) PhoneSoft and its Representatives keep strictly
confidential the existence and terms of this Agreement;
(b) neither PhoneSoft nor any of its Representatives issues or
disseminates any press release or other publicity or otherwise makes any
disclosure of any nature (to any of PhoneSoft's suppliers, customers,
landlords, creditors or employees or to any other Person) regarding any of
the Transactions, except to the extent that PhoneSoft is required by law to
make any such disclosure regarding the Transactions; and
(c) if PhoneSoft is required by law to make any disclosure
regarding the Transactions, PhoneSoft advises Active Voice, at least five
business days before making such disclosure, of the nature and content of the
intended disclosure.
17.
SECTION 6. PRE-CLOSING COVENANTS OF ACTIVE VOICE
6.1 BEST EFFORTS. During the Pre-Closing Period, Active Voice
shall use its Best Efforts to cause the condition set forth in Section 8 to
be satisfied.
SECTION 7. CONDITIONS PRECEDENT TO ACTIVE VOICE'S OBLIGATION TO CLOSE
Active Voice's obligation to purchase the PhoneSoft Shares and to
take the other actions required to be taken by Active Voice at the Closing is
subject to the satisfaction, at or prior to the Closing, of each of the
following conditions (any of which may be waived by Active Voice, in whole or
in part, in accordance with Section 11.13):
7.1 SATISFACTORY COMPLETION OF PRE-ACQUISITION REVIEW. Active
Voice shall have satisfactorily completed its pre-acquisition investigation
and review of PhoneSoft's business, condition, assets, liabilities,
operations, financial performance, net income and prospects and shall be
satisfied with the results of that investigation and review.
7.2 ACCURACY OF REPRESENTATIONS. All of the representations and
warranties made by PhoneSoft and the Shareholders in this Agreement
(considered collectively), and each of said representations and warranties
(considered individually), shall have been accurate in all material respects
as of the date of this Agreement, and shall be accurate in all material
respects as of the Scheduled Closing Time as if made at the Scheduled Closing
Time, without giving effect to any update to the Disclosure Schedule.
7.3 PERFORMANCE OF OBLIGATIONS. All of the covenants and
obligations that PhoneSoft and the Shareholders are required to comply with
or to perform at or prior to the Closing (considered collectively), and each
of said covenants and obligations (considered individually), shall have been
duly complied with and performed in all material respects.
7.4 APPROVAL OF ACTIVE VOICE'S BOARD OF DIRECTORS. Active Voice's
board of directors shall have ratified the execution of this Agreement by
Active Voice and shall have approved the consummation of the Transactions.
7.5 NO ADVERSE CHANGE. There shall have been no adverse change in
PhoneSoft's business, condition, assets, liabilities, operations, financial
performance, net income or prospects (or in any aspect or portion thereof)
since the date of this Agreement.
7.6 ADDITIONAL DOCUMENTS. Active Voice shall have received the
following documents:
(a) an opinion letter from Best Best Xxxxxxx LLP, dated the
Closing Date, reasonably satisfactory to counsel for Active Voice and which
addresses the matters set forth in EXHIBIT E;
(b) such other documents as Active Voice may request in good
faith for the purpose of (i) evidencing the accuracy of any representation or
warranty made by PhoneSoft or any of the Shareholders, (ii) evidencing the
compliance by PhoneSoft or any of the Shareholders with, or the performance
by PhoneSoft or any of the Shareholders of, any covenant or obligation
18.
set forth in this Agreement, (iii) evidencing the satisfaction of any
condition set forth in this Section 7, or (iv) otherwise facilitating the
consummation or performance of any of the Transactions.
7.7 NO PROCEEDINGS. Since the date of this Agreement, there shall not
have been commenced or threatened against Active Voice, or against any Person
affiliated with Active Voice, any Proceeding (a) involving any challenge to, or
seeking damages or other relief in connection with, any of the Transactions, or
(b) that may have the effect of preventing, delaying, making illegal or
otherwise interfering with any of the Transactions.
7.8 NO CLAIM REGARDING STOCK OWNERSHIP OR SALE PROCEEDS. No Person
shall have made or threatened any claim asserting that such Person (a) may be
the holder or the beneficial owner of, or may have the right to acquire or to
obtain beneficial ownership of, any capital stock or other securities of
PhoneSoft, or (b) may be entitled to all or any portion of the Exchange Shares.
7.9 NO PROHIBITION. Neither the consummation nor the performance of any
the Transactions will, directly or indirectly (with or without notice or lapse
of time), contravene or conflict with or result in a violation of, or cause
Active Voice or any Person affiliated with Active Voice to suffer any adverse
consequence under, (a) any applicable Legal Requirement or Order, or (b) any
Legal Requirement or Order that has been proposed by or before any Governmental
Body.
7.10 EXERCISE OF OPTIONS. Each of the Shareholders shall have exercised
the options described in Section 2.3(b) and all of the PhoneSoft Shares shall
have been issued and shall be fully paid and non-assessable.
SECTION 8. CONDITIONS PRECEDENT TO SHAREHOLDERS' OBLIGATION TO CLOSE
The Shareholders' obligation to sell the PhoneSoft Shares and to take
the other actions required to be taken by the Shareholders at the Closing is
subject to the satisfaction, at or prior to the Closing, of each of the
following conditions (any of which may be waived by the Agent, in whole or in
part, in accordance with Section 11.13):
8.1 ACCURACY OF REPRESENTATIONS. All of the representations and
warranties made by Active Voice in this Agreement (considered collectively), and
each of said representations and warranties (considered individually), shall
have been accurate in all material respects as of the date of this Agreement and
shall be accurate in all material respects as of the Scheduled Closing Time as
if made at the Scheduled Closing Time.
8.2 PURCHASER'S PERFORMANCE. All of the covenants and obligations that
Active Voice is required to comply with or to perform pursuant to this Agreement
at or prior to the Closing (considered collectively), and each of said covenants
and obligations (considered individually), shall have been complied with and
performed in all material respects.
8.3 NO INJUNCTION. There shall not be in effect any injunction that
shall have been entered by a court of competent jurisdiction since the date of
this Agreement and that prohibits the sale of the PhoneSoft Shares by the
Shareholders to Active Voice.
19.
SECTION 9. TERMINATION
9.1 TERMINATION EVENTS. This Agreement may be terminated prior to the
Closing:
(a) by Active Voice if (i) there is a material Breach of any
covenant or obligation of PhoneSoft or any of the Shareholders, or (ii) Active
Voice reasonably determines that the timely satisfaction of any condition set
forth in Section 7 has become impossible or impractical (other than as a result
of any failure on the part of Active Voice comply with or perform its covenants
and obligations under this Agreement);
(b) by the Agent if (i) there is a material Breach of any
covenant or obligation of Active Voice, or (ii) the Agent reasonably determines
that the timely satisfaction of any condition set forth in Section 8 has become
impossible or impractical (other than as a result of any failure on the part of
PhoneSoft or any of the Shareholders to comply with or perform any covenant or
obligation set forth in this Agreement);
(c) by Active Voice at or after the Scheduled Closing Time if
any condition set forth in Section 7 has not been satisfied by the Scheduled
Closing Time;
(d) by the Agent at or after the Scheduled Closing Time if any
condition set forth in Section 8 has not been satisfied by the Scheduled Closing
Time;
(e) by Active Voice if the Closing has not taken place on or
before June 1, 2000 (other than as a result of any failure on the part of Active
Voice to comply with or perform its covenants and obligations under this
Agreement);
(f) by the Agent if the Closing has not taken place on or
before June 1, 2000 (other than as a result of the failure on the part of
PhoneSoft or any of the Shareholders to comply with or perform any covenant or
obligation set forth in this Agreement); or
(g) by the mutual consent of Active Voice and the Agent.
9.2 TERMINATION PROCEDURES. If Active Voice wishes to terminate this
Agreement pursuant to Section 9.1(a), Section 9.1(c) or Section 9.1(e), Active
Voice shall deliver to the Agent a written notice stating that Active Voice is
terminating this Agreement and setting forth a brief description of the basis on
which Active Voice is terminating this Agreement. If the Agent wishes to
terminate this Agreement pursuant to Section 9.1(b), Section 9.1(d) or Section
9.1(f), the Agent shall deliver to Active Voice a written notice stating that
the Agent is terminating this Agreement and setting forth a brief description of
the basis on which the Agent is terminating this Agreement.
9.3 EFFECT OF TERMINATION. If this Agreement is terminated pursuant to
Section 9.1, all further obligations of the parties under this Agreement shall
terminate; PROVIDED, HOWEVER, that:
(a) no party shall be relieved of any obligation or other
Liability arising from any Breach by such party of any provision of this
Agreement;
20.
(b) the parties shall, in all events, remain bound by and
continue to be subject to the provisions set forth in Section 11; and
(c) PhoneSoft and the Shareholders shall, in all events,
remain bound by and continue to be subject to Section 5.5.
9.4 NONEXCLUSIVITY OF TERMINATION RIGHTS. The termination rights
provided in Section 9.1 shall not be deemed to be exclusive. Accordingly, the
exercise by any party of its right to terminate this Agreement pursuant to
Section 9.1 shall not be deemed to be an election of remedies and shall not be
deemed to prejudice, or to constitute or operate as a waiver of, any other right
or remedy that such party may be entitled to exercise (whether under this
Agreement, under any other Contract, under any statute, rule or other Legal
Requirement, at common law, in equity or otherwise).
SECTION 10. INDEMNIFICATION AND RELATED MATTERS
10.1 SURVIVAL OF REPRESENTATIONS, ETC.
(a) The representations and warranties made by PhoneSoft and
the Shareholders (including the representations and warranties set forth in
Sections 2 and 3) shall survive the Closing and shall expire on the first
anniversary of the Closing Date; PROVIDED, HOWEVER, that if, at any time prior
to the first anniversary of the Closing Date, any Indemnitee (acting in good
faith) delivers to the Shareholders' Agent a written notice alleging the
existence of an inaccuracy in or a breach of any of the representations and
warranties made by the Shareholders (and setting forth in reasonable detail the
basis for such Indemnitee's belief that such an inaccuracy or breach may exist)
and asserting a claim for recovery under Section 10.2 based on such alleged
inaccuracy or breach, then the claim asserted in such notice shall survive the
first anniversary of the Closing until such time as such claim is fully and
finally resolved.
(b) With the exception of Section 4.3, all representations and
warranties made by Active Voice shall terminate and expire as of the Closing
Date, and any liability of Active Voice with respect to such representations and
warranties shall thereupon cease. The representations of Active Voice set forth
in Section 4.3 shall survive the Closing and shall expire on the date which is
eighteen (18) months following the Closing Date; PROVIDED, HOWEVER, that if, at
any time prior to such date any Shareholder (acting in good faith) delivers to
Active Voice a written notice alleging the existence of an inaccuracy in or a
breach of Section 4.3 (and setting forth in reasonable detail the basis for such
Shareholder's belief that such an inaccuracy or breach may exist) and asserting
a claim for recovery based on such alleged inaccuracy or breach, then the claim
asserted in such notice shall survive until such time as such claim is fully and
finally resolved.
(c) The representations, warranties, covenants and obligations
of PhoneSoft and the Shareholders, and the rights and remedies that may be
exercised by the Indemnitees, shall not be limited or otherwise affected by or
as a result of any information furnished to, or any investigation made by or
knowledge of, any of the Indemnitees or any of their Representatives.
(d) For purposes of this Agreement, each statement or other
item of information set forth in the Disclosure Schedule or in any update to the
Disclosure Schedule
21.
shall be deemed to be a representation and warranty made by
PhoneSoft and the Shareholders in this Agreement.
10.2 INDEMNIFICATION BY SHAREHOLDERS. From and after the Closing Date
(but subject to Section 10.4 and the other limitations set forth in this Section
10), the Shareholders (the "Indemnitors"), severally (and not jointly) and in
proportion to their shareholdings as described in Section 1.2, shall hold
harmless and indemnify each of the Indemnitees from and against any Damages that
are directly or indirectly suffered or incurred by any of the Indemnitees or to
which any of the Indemnitees may otherwise become subject (regardless of whether
or not such Damages relate to any third-party claim) and that arise from or as a
result of, or are directly or indirectly connected with: (a) any inaccuracy in
or breach of any representation or warranty set forth in Section 2 or Section 3
(as modified by the Disclosure Schedule, but without giving effect to any update
to the Disclosure Schedule (other than an update provided in accordance with the
last sentence of this Section 10.2) delivered by PhoneSoft to Active Voice after
the date of this Agreement and prior to the Closing); (b) any inaccuracy in or
breach of any representation or warranty set forth in Section 2 or Section 3 (as
modified by the Disclosure Schedule) as if such representation and warranty had
been made on and as of the Closing Date (giving effect to any update to the
Disclosure Schedule delivered by PhoneSoft to Active Voice prior to the Closing
to the extent that Active Voice would be entitled to terminate this Agreement as
a result of such update); (c) any breach of any covenant or obligation of
PhoneSoft; or (d) any Legal Proceeding relating to any inaccuracy or breach of
the type referred to in clause "(a)," "(b)" or "(c)" above (including any Legal
Proceeding commenced by any Indemnitee for the purpose of enforcing any of its
rights under this Section 10); PROVIDED, HOWEVER, that, except as set forth in
Section 10.4 with respect to claims based upon fraud, the aggregate amount for
which the Indemnitors are required to indemnify the Indemnitees pursuant to this
Section 10.2 will not exceed the value of the Holdback Shares. For purposes of
this Section 10.2 only, any update to the Disclosure Schedule delivered by
PhoneSoft to Active Voice on or before February 2, 2000, shall be deemed to be
part of the Disclosure Schedule dated as of and delivered to Active Voice on the
date of this Agreement; PROVIDED, that such update (i) corrects errors or
omissions that are immaterial but would otherwise cause a representation or
warranty to be inaccurate or (ii) discloses items of which neither PhoneSoft nor
the Shareholders had knowledge as of the date of this Agreement and which are
not the result of any act or omission of a Shareholder or PhoneSoft following
the execution of this Agreement.
10.3 SETOFF. In the event any Shareholder shall have any liability (for
indemnification or otherwise) to any Indemnitee under this Section 10, Active
Voice shall be entitled to satisfy such liability by reducing the number of
Holdback Shares otherwise deliverable to such Shareholder pursuant to Section
1.2 by that number of shares determined by dividing (a) the aggregate dollar
amount of such liability BY (b) the average of the closing sale prices of a
share of Active Voice Common Stock as reported on Nasdaq for each of the ten
consecutive trading days immediately preceding the Closing Date, as adjusted as
appropriate to reflect any stock split, reverse stock split, stock dividend,
recapitalization or other similar transaction effected by Active Voice between
the Closing Date and the date such liability is satisfied.
10.4 EXCLUSIVE REMEDY. With the exception of claims based upon fraud,
from and after the Closing, recourse to setoff against the Holdback Shares in
accordance with Section 10.3 shall be the sole and exclusive remedy of Active
Voice and the other Indemnitees for monetary
22.
damages for any inaccuracy in or breach of any representation or warranty
contained in this Agreement.
10.5 NO CONTRIBUTION. Each Shareholder waives, and acknowledges and
agrees that such Shareholder shall not have and shall not exercise or assert or
attempt to exercise or assert, any right of contribution or right of indemnity
or any other right or remedy against PhoneSoft in connection with any
indemnification obligation or any other Liability to which such Shareholder may
become subject under any of the Transactional Agreements or otherwise in
connection with any of the Transactions.
10.6 INTEREST. Any party that is required to indemnify any other Person
pursuant to this Section 10 with respect to any Damages shall also be required
to pay such other Person interest on the amount of such Damages (for the period
commencing as of the date on which such other Person first incurred or otherwise
became subject to such Damages and ending on the date on which the applicable
indemnification payment is made by such party) at a floating rate three
percentage points above the rate of interest publicly announced by Bank of
America, N.T. & S.A. from time to time as its prime, base or reference rate.
10.7 DEFENSE OF THIRD PARTY CLAIMS. In the event of the assertion or
commencement by any Person of any claim or Proceeding (whether against
PhoneSoft, against any other Indemnitee or against any other Person) with
respect to which any of the Shareholders may become obligated to indemnify, hold
harmless, compensate or reimburse any Indemnitee pursuant to this Section 10,
Active Voice shall have the right, at its election, to tender the defense of
such claim or Proceeding to the Agent at the sole expense of the Shareholders.
If Active Voice so elects to tender the defense and Agent assumes the defense of
any such claim or Proceeding:
(a) the Agent shall proceed to defend such claim or Proceeding
in a diligent manner with counsel satisfactory to Active Voice;
(b) Active Voice shall make available to the Agent any
non-privileged documents and materials in the possession of Active Voice that
may be necessary to the defense of such claim or Proceeding;
(c) the Agent shall keep Active Voice informed of all material
developments and events relating to such claim or Proceeding;
(d) Active Voice shall have the right to participate in the
defense of such claim or Proceeding;
(e) the Agent shall not settle, adjust or compromise such
claim or Proceeding without the prior written consent of Active Voice; and
(f) Active Voice may at any time (notwithstanding the prior
designation of the Agent to assume the defense of such claim or Proceeding)
assume the defense of such claim or Proceeding.
23.
If Active Voice does not elect to designate the Agent to assume the defense of
any such claim or Proceeding, Active Voice may proceed with the defense of such
claim or Proceeding on its own. If Active Voice so proceeds with the defense of
any such claim or Proceeding on its own:
(i) all expenses relating to the defense of such claim or
Proceeding (whether or not incurred by Active Voice) shall be borne and paid
exclusively by Active Voice, subject to Active Voice's right to
indemnification pursuant to Section 10.2;
(ii) the Shareholders shall make available to Active Voice
any documents and materials in the possession or control of any of the
Shareholders that may be necessary to the defense of such claim or Proceeding;
(iii) Active Voice shall keep the Agent informed of all
material developments and events relating to such claim or Proceeding; and
(iv) Active Voice shall have the right to settle, adjust or
compromise such claim or Proceeding with the consent of the Agent; PROVIDED,
HOWEVER, that the Agent shall not unreasonably withhold such consent.
10.8 EXERCISE OF REMEDIES BY INDEMNITEES OTHER THAN PURCHASER. No
Indemnitee (other than Active Voice or any successor thereto or assign thereof)
shall be permitted to assert any indemnification claim or exercise any other
remedy under this Agreement unless Active Voice (or any successor thereto or
assign thereof) shall have consented to the assertion of such indemnification
claim or the exercise of such other remedy.
SECTION 11. MISCELLANEOUS PROVISIONS
11.1 SHAREHOLDERS' AGENT
(a) The Shareholders hereby irrevocably nominate, constitute
and appoint Xxxx Xxxxxx as the agent and true and lawful attorney-in-fact of the
Shareholders (the "Agent"), with full power of substitution, to act in the name,
place and stead of the Shareholders for purposes of executing any documents and
taking any actions that the Agent may, in his sole discretion, determine to be
necessary, desirable or appropriate in connection with any of the Transactional
Agreements or any of the Transactions. Xxxx Xxxxxx hereby accepts his
appointment as Agent.
(b) The Shareholders hereby grant to the Agent full authority
to execute, deliver, acknowledge, certify and file on behalf of the Shareholders
(in the name of any or all of the Shareholders or otherwise) any and all
documents that the Agent may, in his sole discretion, determine to be necessary,
desirable or appropriate, in such forms and containing such provisions as the
Agent may, in his sole discretion, determine to be appropriate (including the
General Release referred to in Section 1.3(b)(vii), the Closing Certificate and
any amendment to or waiver of rights under any of the Transactional Agreements).
Notwithstanding anything to the contrary contained in any of the Transactional
Agreements:
(i) Active Voice shall be entitled to deal exclusively
with the Agent on all matters relating to the respective Transactional
Agreements and the respective
24.
Transactions (including all matters relating to any notice to, or any Consent
to be given or action to be taken by, any Shareholder); and
(ii) each Indemnitee shall be entitled to rely conclusively
(without further evidence of any kind whatsoever) on any document executed or
purported to be executed on behalf of any Shareholder by the Agent, and on any
other action taken or purported to be taken on behalf of any Shareholder by
the Agent, as fully binding upon such Shareholder.
(c) The Shareholders recognize and intend that the power of
attorney granted in Section 11.1(a):
(i) is coupled with an interest and is irrevocable;
(ii) may be delegated by the Agent; and
(iii) shall survive the death or incapacity of each
of the Shareholders.
(d) The Agent shall be entitled to treat as genuine, and as
the document it purports to be, any letter, facsimile, telex or other document
that is believed by him to be genuine and to have been telexed, telegraphed,
faxed or cabled by a Shareholder or to have been signed and presented by a
Shareholder.
(e) If the Agent shall die, become disabled or otherwise be
unable to fulfill his responsibilities hereunder, the Shareholders shall, within
ten days after such death or disability, appoint a successor to the Agent and
immediately thereafter notify Active Voice of the identity of such successor.
Any such successor shall succeed the Agent as Agent hereunder. If for any reason
there is no Agent at any time, all references herein to the Agent shall be
deemed to refer to the Shareholders.
(f) All expenses incurred by the Agent in connection with the
performance of his duties as Agent shall be borne and paid by the Shareholders.
11.2 FURTHER ASSURANCES. Each party hereto shall execute and/or cause
to be delivered to each other party hereto such instruments and other documents,
and shall take such other actions, as such other party may reasonably request
(prior to, at or after the Closing) for the purpose of carrying out or
evidencing any of the Transactions.
11.3 FEES AND EXPENSES
(a) Without limiting the generality of anything contained in
Section 11.3(b), the Shareholders shall bear and pay all fees, costs and
expenses (including all legal fees and expenses payable to Best Best Xxxxxxx
LLP) that have been incurred or that are in the future incurred by, on behalf of
or for the benefit of PhoneSoft or any of the Shareholders in connection with:
(i) the negotiation, preparation and review of any
term sheet or similar document relating to any of the Transactions;
25.
(ii) the investigation and review conducted by Active
Voice and its Representatives with respect to PhoneSoft's business (and the
furnishing of information to Active Voice and its Representatives in connection
with such investigation and review);
(iii) the negotiation, preparation and review of this
Agreement (including the Disclosure Schedule), the other Transactional
Agreements and all certificates, opinions and other instruments and documents
delivered or to be delivered in connection with the Transactions;
(iv) the preparation and submission of any filing or notice
required to be made or given in connection with any of the Transactions, and
the obtaining of any Consent required to be obtained in connection with any of
the Transactions; and
(v) the consummation and performance of the Transactions.
NOTWITHSTANDING THE FOREGOING, PHONESOFT SHALL BEAR AND PAY THE FEES AND
EXPENSES OF BEST BEST XXXXXXX LLP UP THROUGH AND INCLUDING THE CLOSING, NOT TO
EXCEED $25,000.
(b) Subject to the provisions of Section 10 (including the
indemnification and other obligations of the Shareholders thereunder), Active
Voice shall bear and pay all fees, costs and expenses (including all legal fees
and expenses payable to Xxxxxx Godward LLP) that have been incurred or that are
in the future incurred by or on behalf of Active Voice in connection with:
(i) the negotiation, preparation and review of any term
sheet or similar document relating to any of the Transactions;
(ii) the investigation and review conducted by Active Voice
and its Representatives with respect to PhoneSoft's business;
(iii) the negotiation, preparation and review of this
Agreement, the other Transactional Agreements and all certificates, opinions
and other instruments and documents delivered or to be delivered in connection
with the Transactions; and
(iv) the consummation and performance of the Transactions.
11.4 ATTORNEYS' FEES. If any legal action or other legal proceeding
relating to any of the Transactional Agreements or the enforcement of any
provision of any of the Transactional Agreements is brought against any party
hereto, the prevailing party shall be entitled to recover reasonable attorneys'
fees, costs and disbursements (in addition to any other relief to which the
prevailing party may be entitled).
26.
11.5 NOTICES. Any notice or other communication required or permitted
to be delivered to any party under this Agreement shall be in writing and shall
be deemed properly delivered, given and received when delivered (by hand, by
registered mail, by courier or express delivery service or by facsimile) to the
address or facsimile number set forth beneath the name of such party below (or
to such other address or facsimile number as such party shall have specified in
a written notice given to the other parties hereto):
if to PhoneSoft: PhoneSoft Corporation
00000 Xxxxxxx Xx.
Xxx Xxxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: 000-000-0000
if to any of the Shareholders:
00000 Xxxxxxx Xx.
Xxx Xxxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: 000-000-0000
if to the Agent: Xxxx Xxxxxx as Agent of the
00000 Xxxxxxx Xx.
Xxx Xxxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: 000-000-0000
WITH A COPY TO: Xxxxxx X. Xxxxx, Esq.
Best Best & Xxxxxxx LLP
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
if to Active Voice: Active Voice Corporation
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000-0000
Attention: President and
General Counsel
Facsimile: (000) 000-0000
WITH A COPY TO: Xxxxxxxxxxx X. Xxxxxx, Esq.
Xxxxxx Godward LLP
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
27.
11.6 PUBLICITY. Without limiting the generality of anything
contained in Section 5.5, on and at all times after the Closing Date:
(a) no press release or other publicity concerning any of the
Transactions shall be issued or otherwise disseminated by or on behalf of any
of the Shareholders, and the Shareholders shall continue to keep the
existence and terms of this Agreement and the other Transactional Agreements
strictly confidential; and
(b) each Shareholder shall keep strictly confidential, and
shall not use or disclose to any other Person, any non-public document or
other information in such Shareholder's possession that relates directly or
indirectly to the business of PhoneSoft, Active Voice or any affiliate of
Active Voice.
11.7 TIME OF THE ESSENCE. Time is of the essence of this Agreement.
11.8 HEADINGS. The underlined headings contained in this Agreement
are for convenience of reference only, shall not be deemed to be a part of
this Agreement and shall not be referred to in connection with the
construction or interpretation of this Agreement.
11.9 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall constitute an original and all of which,
when taken together, shall constitute one agreement.
11.10 GOVERNING LAW; VENUE
(a) This Agreement shall be construed in accordance with, and
governed in all respects by, the internal laws of the State of Washington
(without giving effect to principles of conflicts of laws).
(b) Any legal action or other legal proceeding relating to
this Agreement or the enforcement of any provision of this Agreement may be
brought or otherwise commenced in any state or federal court located in the
County of King, Washington. Each party to this Agreement:
(i) expressly and irrevocably consents and submits
to the jurisdiction of each state and federal court located in the County of
King, Washington (and each appellate court located in the State of
Washington) in connection with any such legal proceeding;
(ii) agrees that each state and federal court
located in the County of King, Washington shall be deemed to be a convenient
forum; and
(iii) agrees not to assert (by way of motion, as a
defense or otherwise), in any such legal proceeding commenced in any state or
federal court located in the County of King, Washington, any claim that such
party is not subject personally to the jurisdiction of such court, that such
legal proceeding has been brought in an inconvenient forum, that the venue of
such proceeding is improper or that this Agreement or the subject matter of
this Agreement may not be enforced in or by such court.
28.
(c) Each Shareholder agrees that, if any Proceeding is
commenced against any Indemnitee by any Person in or before any court or
other tribunal anywhere in the world, then such Indemnitee may proceed
against such Shareholder in such court or other tribunal with respect to any
indemnification claim or other claim arising directly or indirectly from or
relating directly or indirectly to such Proceeding or any of the matters
alleged therein or any of the circumstances giving rise thereto.
(d) Nothing contained in Section 11.10(b) or 11.10(c) shall be
deemed to limit or otherwise affect the right of any Indemnitee to commence
any legal proceeding or otherwise proceed against PhoneSoft or any of the
Shareholders in any other forum or jurisdiction.
(e) The Shareholders irrevocably constitute and appoint the
Agent as their agent to receive service of process in connection with any
legal proceeding relating to this Agreement or the enforcement of any
provision of this Agreement.
(f) The Shareholders irrevocably waive the right to a jury
trial in connection with any legal proceeding relating to this Agreement or
the enforcement of any provision of this Agreement.
11.11 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon:
PhoneSoft and its successors and assigns (if any); the Shareholders and their
respective personal representatives, executors, administrators, estates,
heirs, successors and assigns (if any); and Active Voice and its successors
and assigns (if any). This Agreement shall inure to the benefit of:
PhoneSoft; the Shareholders; Active Voice; the other Indemnitees (subject to
Section 10.10); and the respective successors and assigns (if any) of the
foregoing. Active Voice may freely assign any or all of its rights under this
Agreement (including its indemnification rights under Section 10), in whole
or in part, to any other Person without obtaining the consent or approval of
any other party hereto or of any other Person.
11.12 REMEDIES CUMULATIVE; SPECIFIC PERFORMANCE. The rights and
remedies of the parties hereto shall be cumulative (and not alternative).
Each Shareholder agrees that:
(a) in the event of any Breach or threatened Breach by such
Shareholder of any covenant, obligation or other provision set forth in this
Agreement, Active Voice shall be entitled (in addition to any other remedy
that may be available to it) to (i) a decree or order of specific performance
or mandamus to enforce the observance and performance of such covenant,
obligation or other provision, and (ii) an injunction restraining such Breach
or threatened Breach; and
(b) neither Active Voice nor any other Indemnitee shall be
required to provide any bond or other security in connection with any such
decree, order or injunction or in connection with any related action or
Proceeding.
11.13 WAIVER
(a) No failure on the part of any Person to exercise any
power, right, privilege or remedy under this Agreement, and no delay on the
part of any Person in exercising any power, right, privilege or remedy under
this Agreement, shall operate as a waiver of such power, right,
29.
privilege or remedy; and no single or partial exercise of any such power,
right, privilege or remedy shall preclude any other or further exercise
thereof or of any other power, right, privilege or remedy.
(b) No Person shall be deemed to have waived any claim arising
out of this Agreement, or any power, right, privilege or remedy under this
Agreement, unless the waiver of such claim, power, right, privilege or remedy
is expressly set forth in a written instrument duly executed and delivered on
behalf of such Person; and any such waiver shall not be applicable or have
any effect except in the specific instance in which it is given.
11.14 AMENDMENTS. This Agreement may not be amended, modified,
altered or supplemented other than by means of a written instrument duly
executed and delivered on behalf of Active Voice and the Agent.
11.15 SEVERABILITY. In the event that any provision of this
Agreement, or the application of any such provision to any Person or set of
circumstances, shall be determined to be invalid, unlawful, void or
unenforceable to any extent, the remainder of this Agreement, and the
application of such provision to Persons or circumstances other than those as
to which it is determined to be invalid, unlawful, void or unenforceable,
shall not be impaired or otherwise affected and shall continue to be valid
and enforceable to the fullest extent permitted by law.
11.16 PARTIES IN INTEREST. Except for the provisions of Section 10
hereof, none of the provisions of this Agreement is intended to provide any
rights or remedies to any Person other than the parties hereto and their
respective successors and assigns (if any).
11.17 ENTIRE AGREEMENT. The Transactional Agreements set forth the
entire understanding of the parties relating to the subject matter thereof
and supersede all prior agreements and understandings among or between any of
the parties relating to the subject matter thereof.
11.18 CONSTRUCTION
(a) For purposes of this Agreement, whenever the context
requires: the singular number shall include the plural, and vice versa; the
masculine gender shall include the feminine and neuter genders; the feminine
gender shall include the masculine and neuter genders; and the neuter gender
shall include the masculine and feminine genders.
(b) The parties hereto agree that any rule of construction to
the effect that ambiguities are to be resolved against the drafting party
shall not be applied in the construction or interpretation of this Agreement.
(c) As used in this Agreement, the words "include" and
"including," and variations thereof, shall not be deemed to be terms of
limitation, but rather shall be deemed to be followed by the words "without
limitation."
(d) Except as otherwise indicated, all references in this
Agreement to "Sections" and "Exhibits" are intended to refer to Sections of
this Agreement and Exhibits to this Agreement.
30.
11.19 RESTRICTIONS ON TRANSFER
(a) Each Shareholder agrees that, from the Closing Date to the
Holdback Termination Date, such Shareholder shall not sell, transfer or
otherwise dispose of, or reduce each such Shareholder's interest in or risk
relating to any of the Exchange Shares. Notwithstanding the foregoing, each
of the Shareholder's shall have the right to borrow against the value of the
Exchange Shares. Notwithstanding the foregoing, each of the Shareholders
shall be entitled to borrow against the value of the Exchange Shares,
provided that neither Active Voice nor its transfer agent shall be obligated
to honor any transfer of the ownership of the Exchange Shares that does not
comply with Section 11.19(b).
(b) Each Shareholder agrees that such Shareholder shall not
effect any sale, transfer or other disposition of any of the Exchange Shares
unless:
(i) such sale, transfer or other disposition is
effected pursuant to an effective registration statement under the Act;
(ii) such sale, transfer or other disposition is made
in conformity with the requirements of Rule 145 under the Act, as
evidenced by a broker's letter and a representation letter executed by
such Shareholder (satisfactory in form and content to Active Voice)
stating that such requirements have been met;
(iii) counsel reasonably satisfactory to Active Voice
shall have advised Active Voice in a written opinion letter
(satisfactory in form and content to Active Voice), upon which Active
Voice may rely, that such sale, transfer or other disposition will be
exempt from the registration requirements of the Securities Act; or
(iv) an authorized representative of the SEC shall
have rendered written advice to each Shareholder to the effect that the
SEC would take no action, or that the staff of the SEC would not
recommend that the SEC take action, with respect to such sale, transfer
or other disposition, and a copy of such written advice and all other
related communications with the SEC shall have been delivered to Active
Voice.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
31.
The parties hereto have caused this Agreement to be executed and
delivered as of January 28, 2000.
"PURCHASER": ACTIVE VOICE CORPORATION,
a Washington corporation
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------------
Xxxxx X. Xxxxx
President and Chief Executive Officer
"PHONESOFT": PHONESOFT INC.,
a California corporation
By: /s/ Xxxx Xxxxxx
-----------------------------------------------
Xxxx Xxxxxx
President and Chief Executive Officer
"SHAREHOLDERS":
/s/ Xxxx Xxxxxx
--------------------------------------------------
XXXX XXXXXX
/s/ Xxxx Xxxx
--------------------------------------------------
XXXX XXXX
/s/ Xxxxxxx Xxxxxxx
--------------------------------------------------
XXXXXXX XXXXXXX
/s/ Xxxxxx Xxxx
--------------------------------------------------
XXXXXX XXXX, AS TRUSTEE OF THE
XXXXXX X. XXXX TRUST DATED JUNE 28, 1996
32.
