EX-4.68
8
y41094exv4w68.htm
EX-4.68:
COMMON SHARE REPURCHASE, VOTING AND CONVERSION AGREEMENT
THIS AMENDED AND RESTATED
COMMON SHARE REPURCHASE, VOTING AND CONVERSION AGREEMENT is made as of
the 15th day of August, 2007.
BETWEEN:
POWER TECHNOLOGY INVESTMENT CORPORATION, a corporation governed by the laws of
Canada,
(the “Shareholder”)
- and -
MITEL NETWORKS CORPORATION, a corporation governed by the laws of Canada,
(“Mitel”)
RECITALS:
| A. | | The Shareholder is the beneficial owner of 16,000,000 issued and outstanding Class B convertible
preferred shares, Series 1 (the “Series B Shares”) in the capital of Mitel. |
| |
| B. | | Mitel has agreed to acquire indirectly all of the outstanding stock of Inter-Tel (Delaware),
Incorporated (“Inter-Tel”) (the “Merger”) pursuant to the terms of an agreement and plan of
merger between Inter-Tel, Mitel and a subsidiary of Mitel dated April 26, 2007. |
| |
| C. | | In contemplation of the Merger, the Shareholder has agreed to convert, in accordance with their
terms, the Series B Shares into 16,000,000 Common Shares and, in connection with such conversion,
to receive an additional 10,912,085 Common Shares pursuant to Section 5.4 of Schedule B to the
articles of amendment of Mitel filed April 23, 2004 (the “Articles”). |
| |
| D. | | In further contemplation of the Merger, the Shareholder has agreed to exercise its put right
contained in Section 6.7 of the shareholders agreement (the “Shareholders Agreement”) dated as of
the 23rd day of April, 2004 among Mitel, the Shareholder and |
- 2 -
| | | certain other shareholders of Mitel, as amended by amending agreement dated as of the
26th day of June, 2006 and as further amended by second amending agreement dated
June 22, 2007 and to sell to Mitel, and Mitel has agreed to repurchase, 13,456,043 Common
Shares (the “Shares”) held by the Shareholder after the conversion of Series B Shares
described in Recital C above, at the purchase price and on the terms and conditions set
forth in this Agreement. |
| E. | | The Shareholder has agreed to subscribe for Class 1 Shares of Mitel and Warrants to acquire
Common Shares. |
| |
| F. | | Also in contemplation of the Merger, the Shareholder and Mitel have agreed to take certain other
actions as set forth in this Agreement. |
THEREFORE, the parties agree as follows:
Whenever used in this Agreement, the following words and terms have the meanings set out below:
“Affiliate” has the meaning set forth in the Canada Business Corporations Act;
“Agreement” means this Amended and Restated
Common Share Repurchase, Voting and Conversion
Agreement, including all schedules, and all amendments or restatements, as permitted, and
references to “Article” or “Section” mean the specified Article or Section of this
Agreement;
“Business Day” means any day on which the Canadian chartered banks are open for business in
the City of Ottawa, excluding Saturdays and Sundays;
“Class 1 Shares” means the Class 1 Shares in the capital of Mitel to be created prior to
the completion of the Merger;
“Closing Date” has the meaning set forth in Section 2;
“Common Shares” means the common shares in the capital of Mitel;
- 3 -
“Encumbrances” means pledges, liens, charges, security interests, leases, title retention
agreements, mortgages, restrictions, developments or similar agreements, easements,
rights-of-way, title defects, options or adverse claims, or encumbrances of any kind or
character whatsoever; and
“Parties” means the Shareholder and Mitel, collectively, and “Party” means any one of them.
| 2. | | Notification of Closing of the Merger |
At least ten (10) Business Days prior to the date of closing (the “Closing Date”) of the Merger,
Mitel shall provide written notice (the “Mitel Notice”) of such Closing Date to the Shareholder,
which notice shall also include reference to the date on or before which the Shareholder is
required to deliver, in connection with the Merger, to Mitel the Shareholder’s (a) notice of
conversion pursuant to Section 5.8 of Schedule B to the Articles, and (b) notice of exercise of its
put rights pursuant to Section 6.7 of the Shareholders Agreement.
| 3. | | Agreement to Convert the Series B Shares |
The Shareholder hereby agrees to convert to Common Shares the Series B Shares in accordance with
Section 5.1 of Schedule B to the Articles immediately prior to and conditional upon the closing of
the Merger, in respect of which conversion the Shareholder shall receive from Mitel 16,000,000
Common Shares and an additional 10,912,085 Common Shares pursuant to Section 5.4 of Schedule B to
the Articles. At least six (6) Business Days prior to the Closing Date, the Shareholder shall
deliver to Mitel a written conversion notice (the “PTIC Conversion Notice”) in accordance with
Section 5.8 of Schedule B to the Articles regarding the conversion of the Series B Shares. The
PTIC Conversion Notice shall be in the form attached to this Agreement as Schedule “A”.
| 4. | | Exercise of the PTIC Put Right |
At least six (6) Business Days prior to the Closing Date, the Shareholder shall deliver to Mitel a
written notice (the “PTIC Put Notice”) requiring Mitel to purchase all of the Shares immediately
prior to and conditional upon the closing of the Merger, pursuant to and in accordance with Section
6.7 of the Shareholders Agreement. The PTIC Put Notice shall be in
- 4 -
the form attached to this Agreement as Schedule “B”. Concurrently with its delivery of the PTIC Put
Notice, the Shareholder shall deliver to Mitel share certificate(s) representing the Shares duly
endorsed in blank for transfer, or accompanied by irrevocable security transfer powers of attorney
duly executed in blank, such certificates to be held in escrow pending the closing of the Merger
and shall not be released until PTIC has received written notice from Mitel that all conditions to
the closing of the Merger have been met and that the closing of the Merger has been completed in
its entirety.
| 5. | | Repurchase of Shares, Payment of Purchase Price and Subscription for Class 1 Shares and
Warrants |
| | (a) | | Immediately prior to and conditional upon the closing of the Merger, the Shareholder
shall sell, assign and transfer to Mitel and Mitel shall repurchase from the Shareholder,
as of the Closing Date, the Shares for an aggregate purchase price equal to SEVENTEEN
MILLION, ONE HUNDRED EIGHTY-FOUR THOUSAND, SEVEN HUNDRED AND TWELVE Dollars
($17,184,712), based on a purchase price per share of $1.2771 (the “Purchase
Price”). |
| |
| | (b) | | Mitel shall pay and satisfy the Purchase Price on the Closing Date by way of certified
cheque drawn in the name of or wire transfer to the account of the Shareholder (without
withholding, deduction or set off in any manner whatsoever other than any withholding
required or expressly permitted by applicable tax law).
In the event the Shareholder requires satisfaction of the Purchase Price by way of
wire transfer, the Shareholder shall provide to Mitel in writing its wire transfer
coordinates at least three (3) Business Days prior to the Closing Date, together
with the coordinates of a contact person at the Shareholder’s bank authorized to
make the necessary arrangements with regards to such wire transfer. |
| |
| | (c) | | Upon payment of the Purchase Price by Mitel, the Shareholder shall immediately
subscribe for 11,500 Class 1 Shares and Warrants to acquire 871,441 Common Shares at an
exercise price of US$1.32. The aggregate subscription price for such
Class 1 Shares and Warrants shall be US$11,500,000 (the “Subscription Price”). |
- 5 -
| | (d) | | The Shareholder hereby directs Mitel to pay the Shareholder the net amount of the
Purchase Price less the Subscription Price and, upon receipt of such net amount by the
Shareholder, both the Purchase Price and the Subscription Price shall be deemed to be fully
paid. |
| 6. | | Failure to Close the Merger |
Mitel shall provide to the Shareholder written notice of the Closing of the Merger immediately upon
such closing, such notice to state that all conditions to the closing of the Merger have been met
and that the closing of the Merger has been completed in its entirety. In the event that the
closing of the Merger has not occurred within thirty (30) days of the Closing Date referenced in
the Mitel Notice, the PTIC Put Notice delivered in accordance with Section 4 of this Agreement
shall be void and of no further effect and Mitel shall forthwith return to the Shareholder the
share certificates evidencing the Shares.
The Shareholder hereby agrees to vote (or cause to be voted) the Series B Shares, whether by way of
vote, in person or by proxy, at any shareholders meeting or by way of written consent, in favour
of, and to take all other actions necessary or desirable to approve the amendment of the articles
of Mitel to:
| | (a) | | create a new class of shares in the capital of Mitel, the
Class 1 convertible preferred shares, substantially on the terms and conditions set forth in the draft subscription
agreement provided to the Shareholder as Schedule A to the Consent and Waiver executed by
the Shareholder on or about the date hereof; and |
| |
| | (b) | | after the repurchase of the Shares and certain other shares in the capital of Mitel, to
delete from the articles the class A convertible preferred shares and class B convertible
preferred shares, together with all designated series thereof. |
To the extent permitted by law, the Shareholder hereby expressly waives any right of dissent or
appraisal under applicable laws with respect to the approvals set forth in paragraphs (a) and (b)
of this Section 7.
- 6 -
| 8. | | Agreement to Terminate Shareholders Agreement and Registration Rights Agreement |
The Shareholder hereby agrees to terminate, conditional upon the completion by Mitel of its
obligation to repurchase the Shares pursuant to this Agreement and upon the closing of the Merger:
| | (a) | | the Shareholder’s Agreement; and |
| |
| | (b) | | the Registration Rights Agreement dated as of the 23rd day of April, 2004
among Mitel, the Shareholder and certain other shareholders of Mitel (the “Registration
Rights Agreement”), |
in accordance with the terms of each of the Shareholders Agreement and the Registration Rights
Agreement. The form of such termination agreement shall be substantially as set forth in Schedule
“C” (Termination of Shareholders Agreement and Registration Rights Agreement) attached to this
Agreement. For greater certainty, this Agreement, and the termination of the Shareholder’s
Agreement and the Registration Rights Agreement contemplated hereby, shall be of no effect
whatsoever unless and until written notification from Mitel has been received by the Shareholder
that all conditions to closing of the Merger have been met and the Merger has been completed in its
entirety.
| 9. | | Agreement to Become a Party to Francisco Partners Shareholders Agreement |
As a condition to the Shareholder’s obligations pursuant to Sections 3, 4, 5 and 8 of this
Agreement, the Shareholder and Mitel hereby agree that the Shareholder shall, on the Closing Date,
conditional upon the closing of the Merger, become a party to the shareholders agreement to be
entered into by Mitel, Francisco Partners II, L.P. (“Francisco Partners”) and certain other
shareholders in Mitel, substantially in the form of agreement attached as Schedule “D” to this
Agreement, as a Shareholder (as defined in such shareholders agreement).
| 10. | | Representations, Warranties and Covenants of the Shareholder |
The Shareholder represents, warrants and covenants that:
- 7 -
| | (a) | | the Shareholder has the requisite power, authority and capacity to enter into this
Agreement (and all other agreements and documents required to be delivered hereunder) on
the terms and conditions herein set forth and to transfer the legal and beneficial right,
title and ownership of the Shares to Mitel and all necessary corporate action has been or
will be taken prior to the Closing Date on the part of the Shareholder to transfer the
legal and beneficial right, title and ownership of the Shares to Mitel on the Closing Date; |
| |
| | (b) | | the execution and delivery of this Agreement and the consummation of the transactions
contemplated by this Agreement have been duly authorized by all necessary corporate or
similar action on the part of the Shareholder. This Agreement and all documents executed
or to be executed by the Shareholder pursuant to this Agreement constitute and will
constitute on the Closing Date valid and binding obligations of the Shareholder enforceable
against it in accordance with their respective terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws relating to or affecting
creditors’ rights generally and subject to general principles of equity; |
| |
| | (c) | | the execution, delivery, and performance of this Agreement by the Shareholder will not
(i) constitute a violation of its articles of incorporation or by-laws, each as amended,
(ii) result in the breach of or constitute a default under any material agreement of the
Shareholder, or (iii) constitute a violation of any law applicable or relating to it or its
businesses; |
| |
| | (d) | | no Person, other than Mitel, has any agreement, option or right to purchase or acquire,
or capable of becoming an agreement for the purchase or acquisition of, the Shares; and |
| |
| | (e) | | the Shareholder has good and marketable title to the Shares and has the exclusive right
to dispose of the Shares. The Shares will be transferred and sold to Mitel free and clear
of all Encumbrances. |
| 11. | | Representations, Warranties and Covenants of Mitel |
Mitel hereby represents, warrants and covenants to the Shareholder that:
- 8 -
| | (a) | | Mitel has the requisite power, authority and capacity to enter into this Agreement (and
all other agreements and documents required to be delivered hereunder) and to carry out its
obligations under this Agreement on the terms and conditions herein set forth, including
the repurchase of the Shares set forth in this Agreement; |
| |
| | (b) | | the execution and delivery of this Agreement and the consummation of the transactions
contemplated by this Agreement have been duly authorized by all necessary corporate action
on the part of Mitel. This Agreement and all documents executed or to be executed by Mitel
pursuant to this Agreement constitute and will constitute on the Closing Date valid and
binding obligations of Mitel enforceable against it in accordance with their respective
terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and other laws relating to or affecting creditors’ rights generally and subject to general
principles of equity; |
| |
| | (c) | | the execution, delivery, and performance of this Agreement by Mitel (including the
acquisition of the Shares) will not (i) constitute a violation of its articles of
incorporation or by-laws, each as amended, (ii) result in the breach of or constitute a
default under any material agreement of Mitel, or (iii) constitute a violation of any law
applicable or relating to it or its businesses; and |
| |
| | (d) | | the issuance of the Class 1 Shares and Warrants to the Shareholder has been duly
authorized by Mitel and the Class 1 Shares, the Common Shares issuable upon the due
conversion of the Class 1 Shares and the Common Shares issuable upon the due exercise of
the Warrants referred to in Section 5(c) shall be validly issued as fully paid and
non-assessable shares in the capital of Mitel. |
| 12. | | Survival of Representations, Warranties and Covenants |
The respective representations, warranties and covenants of the Shareholder and Mitel contained
herein shall survive the consummation of the repurchase of the Shares. No investigations made by or
on behalf of Mitel or the Shareholder or any of their respective authorized agents at any time
shall have the effect of waiving, diminishing the scope of or otherwise affecting any
- 9 -
representation, warranty or covenant made by the Shareholder or Mitel, as the case may be, in or
pursuant to this Agreement.
The Shareholder shall sign, execute and deliver all documents, transfers, assignments, matters and
things which are convenient and necessary or which counsel for Mitel may advise for more completely
and effectually conveying, assigning and transferring to or vesting all right, title and interest
in the Shares in Mitel on the Closing Date.
Should the Shareholder, in the opinion of Mitel acting reasonably, fail to transfer the Shares to
Mitel in accordance with Section 5 or to vote the Series B Shares in accordance with Section 7, or
to fulfil any of its other obligations pursuant to this Agreement, then the Secretary of Mitel
shall be deemed to be irrevocably appointed as the true and lawful attorney for the Shareholder
with authority to do all things and execute and deliver, on behalf of and in the name of the
Shareholder, such consents, resolutions, proxies, deeds, transfers, share certificates,
resignations or other documents as may be necessary to complete the sale transaction contemplated
herein, and to vote the Series B Shares in accordance with Section 7, and the Shareholder shall
have no claim or cause of action against any Party hereto, or against any third party, as a result
of the Secretary of Mitel so acting as its attorney, or otherwise in connection with such sale
transaction or vote. Such appointment and power of attorney, being coupled with an interest, shall
not be revoked by the insolvency or bankruptcy of the Shareholder and the Shareholder hereby
ratifies and confirms and agrees to ratify and confirm all that the Secretary of Mitel may lawfully
do or cause to be done by virtue of such appointment and power.
The Parties shall, with reasonable diligence, do all such things and provide all such reasonable
assurances as may be required to consummate the transactions contemplated by this Agreement, and
each Party shall provide such further documents or instruments required by the other Party as may
be reasonably necessary or desirable to effect the purpose of this Agreement and carry out its
provisions.
- 10 -
| 16. | | Remedies and Specific Performance |
The rights and remedies of the Parties under this Agreement are cumulative and are not exclusive of
any rights or remedies that the Parties would otherwise have under this Agreement or otherwise.
The Parties agree that a breach by the other party of this Agreement would cause irreparable harm
and that money damages may not be an adequate remedy for violations of this Agreement and,
therefore that a Party may, in its sole discretion, apply to a court for specific performance,
injunctive, or such other relief as such court may deem just and proper in order to enforce this
Agreement or prevent any violation thereof.
Any notice, consent or approval required or permitted to be given in connection with this Agreement
(in this Section referred to as a “Notice”) shall be in writing and shall be sufficiently given if
delivered (whether in person, by courier service or other personal method of delivery), or if
transmitted by facsimile or e-mail:
| | (a) | | in the case of a Notice to the Shareholder at: |
Power Technology Investment Corporation
751, Square Victoria
Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Mr. Xxxxx Xxxxx
Fax: (000) 000-0000
| | (b) | | in the case of a Notice to Mitel at: |
Mitel Networks Corporation
000 Xxxxxx Xxxxx
X.X. Xxx 00000
Xxxxxx, XX X0X 0X0
Attention: Xxxxx Xxxxxxx
Fax: (000) 000-0000
| Any Party may, from time to time, change its address by giving Notice to the other Parties in
accordance with the provisions of this Section. |
- 11 -
| | (a) | | All amounts references herein are references to United States dollars unless otherwise
specifically indicated. |
| |
| | (b) | | Time is of the essence in the performance of the Parties’ respective obligations. |
| |
| | (c) | | This Agreement is a contract made under and shall be governed by and construed in
accordance with the laws of the Province of Ontario and the federal laws of Canada
applicable in the Province of Ontario. |
| |
| | (d) | | This Agreement enures to the benefit of and is binding upon the Parties and their
respective successors and assigns. |
| |
| | (e) | | No amendment, supplement, modification, waiver or termination of this Agreement and,
unless otherwise specified, no consent or approval by any Party, is binding unless executed
in writing by the Party to be bound. |
| |
| | (f) | | This Agreement may be executed by the Parties in counterparts and may be executed and
delivered by facsimile and all such counterparts and facsimiles together constitute one and
the same agreement. |
[The remainder of this page is intentionally left blank]
- 12 -
IN WITNESS OF WHICH the Shareholder and Mitel have executed this Agreement.
| | | | | |
| | POWER TECHNOLOGY INVESTMENT CORPORATION
| |
| | By: | /s/ Xxxxx Xxxxx
| |
| | | Name: | Xxxxx Xxxxx | |
| | | Title: | President and CEO | |
| |
| | MITEL NETWORKS CORPORATION
| |
| | By: | /s/
Xxxxx Xxxxxxx | |
| | | Name: | Xxxxx Xxxxxxx | |
| | | Title: | Chief Financial Officer | |
| |
SCHEDULE “A”
FORM OF PTIC CONVERSION NOTICE
NOTICE OF CONVERSION
WHEREAS:
| A. | | Mitel Networks Corporation (the “Corporation”) issued Class B Convertible Preferred
Shares, Series 1 (“Series B Shares”) to Power Technology Investment Corporation (the
“Holder”) on April 23, 2004. |
| |
| B. | | In order to effect an optional conversion of the Series B Shares into common shares in the
capital of the Corporation (the “Common Shares”), the Holder must, pursuant to Section 5.8 of
Schedule B to the Articles of Amendment of the Corporation filed April 23, 2004 (the
“Articles”), deliver this Notice. |
NOW THEREFORE:
The Holder hereby elects to convert 16,000,000 Series B Shares held by the Holder into 16,000,000
Common Shares pursuant to Section 5.1 of Schedule B to the Articles and to receive an additional
10,912,085 Common Shares, being the aggregate number of shares required to be delivered by the
Corporation pursuant to Section 5.4 of Schedule B to the Articles.
The certificate representing the Common Shares to be issued upon conversion shall be registered as
follows:
| | | | | |
| Name of Registrant | | Number of Common Shares | |
| Power Technology Investment Corporation
| | 26,912,085 | |
| 000, Xxxxxx Xxxxxxxx
| | | | |
| Xxxxxxxx, Xxxxxx X0X 0X0
| | | | |
DATED this day of , 2007.
| | | | | |
| | POWER TECHNOLOGY INVESTMENT
CORPORATION
| |
| | By: | | |
| | | Name: | Xxxxx Xxxxx | |
| | | Title: | President and CEO | |
SCHEDULE “B”
FORM OF PTIC PUT NOTICE
PUT NOTICE
| | | |
| TO:
| | Mitel Networks Corporation (the “Corporation”) |
|
| | |
| FROM:
| | Power Technology Investment Corporation (“PTIC”) |
|
| | |
| RE:
| | Shareholders Agreement dated as of April 23, 2004 among the
Corporation, EdgeStone Capital Equity Fund II-B GP, Inc., as agent
for EdgeStone Capital Equity Fund II-A, L.P. and its parallel
investors, and EdgeStone Capital Equity Fund II Nominee, Inc., as
nominee for EdgeStone Capital Equity Fund II-A, L.P. and its
parallel investors, Zarlink Semiconductor Inc., Power Technology
Investment Corporation, Xxxxxx Xxxxxx Corporation, Xxxxxxx X.
Xxxxxxxx and Celtic Tech Jet Limited, as amended by the Amending
Agreement dated as of June 26, 2006 and the Second Amending
Agreement dated as of May 30, 2007 (the “Shareholders Agreement”) |
WHEREAS:
| A. | | Section 6.7(a) of the Shareholders Agreement provides that if, on or prior to May 1,
2007, the Corporation has not completed an Initial Public Offering, PTIC shall have the
right (the “Put Rights”), exercisable from May 2, 2007 to November 1, 2007, solely
immediately prior to and conditional upon the closing of the acquisition of Inter-Tel
(Delaware) Incorporated (“Inter-Tel”) by the Corporation or a subsidiary of the Corporation
set forth in the merger agreement between the Corporation, Inter-Tel and a subsidiary of
the Corporation dated April 26, 2007 (the “Merger”), subject to the terms and conditions of
the Shareholders Agreement, to require the Corporation to purchase 13,456,043 Common Shares
issued to PTIC on conversion of the Series B Shares held by PTIC (the “PTIC Common
Shares”). |
| |
| B. | | PTIC now desires to exercise its Put Rights. |
| |
| C. | | This Put Notice is provided pursuant to Section 6.7(a) of the Shareholders Agreement. |
NOW THEREFORE:
| 1. | | All capitalized terms not otherwise defined herein shall have the meaning ascribed thereto in
the Shareholders Agreement. |
| |
| 2. | | The Corporation is hereby notified that PTIC hereby exercises its Put Rights in respect of
the PTIC Common Shares in accordance with the Shareholders Agreement conditional upon the
closing of the Merger and the Corporation is, therefore, required to purchase the |
- 2 -
| | | PTIC Common Shares immediately prior to and conditional upon the closing of the Merger. |
DATED , 2007.
| | | | | |
| | POWER TECHNOLOGY INVESTMENT CORPORATION
| |
| | By: | | |
| | | Name: | Xxxxx Xxxxx | |
| | | Title: | President and CEO | |
SCHEDULE “C”
FORM OF TERMINATION AGREEMENT OF
SHAREHOLDERS AGREEMENT AND
REGISTRATION RIGHTS AGREEMENT
Filed as an exhibit to
Amendment No. 2 to the Schedule 13D (Mitel as issuer) filed
with the Commission on September 26, 2007 by Xxxxxxx X. Xxxxxxxx,
Xxxxxx Xxxxxx Corporation and Celtic Tech Jet Limited and
incorporated therein by reference.
SCHEDULE “D”
FORM OF FRANCISCO PARTNERS SHAREHOLDERS AGREEMENT
Filed as an exhibit to
Amendment No. 2 to the Schedule 13D (Mitel as issuer) filed
with the Commission on September 26, 2007 by Xxxxxxx X. Xxxxxxxx,
Xxxxxx Xxxxxx Corporation and Celtic Tech Jet Limited and
incorporated therein by reference.
