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EXHIBIT 2.1
AGREEMENT OF MERGER
OF
CISCO SYSTEMS, INC.
AND
COMPATIBLE SYSTEMS CORPORATION
This Agreement of Merger, dated as of the 23nd day of March, 2000
("Merger Agreement"), between Cisco Systems, Inc., a California corporation
("Acquiror"), and Compatible Systems Corporation, a Colorado corporation
("Target").
RECITALS
A. Target was incorporated in the State of Colorado on December 13, 1985
and immediately prior to the Effective Time of the Merger (as defined below)
will have outstanding 5,138,693 shares of Common Stock ("Target Common Stock")
and 1,675,959 shares of Preferred Stock ("Target Preferred Stock").
B. Acquiror and Target have entered into an Agreement and Plan of Merger
and Reorganization (the "Agreement and Plan of Reorganization") providing for
certain representations, warranties, covenants and agreements in connection with
the transactions contemplated hereby. This Merger Agreement and the Agreement
and Plan of Reorganization are intended to be construed together to effectuate
their purpose.
C. The Boards of Directors of Target and Acquiror deem it advisable and
in their mutual best interests and in the best interests of the stockholder of
Target, that Target be acquired by Acquiror through a merger ("Merger") of
Target with and into Acquiror.
D. The Boards of Directors of Acquiror and Target and the stockholders
of Target have approved the Merger.
AGREEMENTS
The parties hereto hereby agree as follows:
1. Target shall be merged with and into Acquiror, and Acquiror
shall be the surviving corporation.
2. The Merger shall become effective at such time (the "Effective
Time") as this Merger Agreement and the officers' certificate of Target are
filed with the Secretary of State of the State of California pursuant to Section
1103 of the Corporations Code of the State of California.
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3. At the Effective Time of the Merger (i) each share of Target
Preferred Stock will convert into one share of Target Common Stock; (ii) all
shares of Target Common Stock that are owned directly or indirectly by Target,
Acquiror or any other direct or indirect wholly owned subsidiary of Target or
Acquiror shall be cancelled, and no securities of Acquiror or other
consideration shall be delivered in exchange therefor; and (iii) each of the
issued and outstanding shares of Target Common Stock (other than shares, if any,
held by persons who have not voted such shares for approval of the Merger and
with respect to which such persons shall become entitled to exercise dissenters'
rights in accordance with the Corporations Code of the State of California
("California Law"), referred to hereinafter as "Dissenting Shares") shall be
converted automatically into and exchanged for .4832569 of a share of Acquiror
Common Stock; provided, however, that no more than 3,846,153 shares of Common
Stock of Acquiror shall be issued in such exchange (including Acquiror Common
Stock reserved for issuance upon exercise of Target options and Target warrants
assumed by Acquiror). Those shares of Acquiror Common Stock to be issued as a
result of the Merger are referred to herein as the "Acquiror Shares".
4. Any Dissenting Shares shall not be converted into Acquiror
Common Stock but shall be converted into the right to receive such consideration
as may be determined to be due with respect to such Dissenting Shares pursuant
to the law of the State of Colorado. If after the Effective Time any Dissenting
Shares shall lose their status as Dissenting Shares, then as of the occurrence
of the event which causes the loss of such status, such shares shall be
converted into Acquiror Common Stock in accordance with Section 3.
5. Notwithstanding any other term or provision hereof, no
fractional shares of Acquiror Common Stock shall be issued, but in lieu thereof
each holder of shares of Target Common Stock who would otherwise, but for
rounding as provided herein, be entitled to receive a fraction of a share of
Acquiror Common Stock shall receive from Acquiror an amount of cash equal to the
per share market value of Acquiror Common Stock (deemed to be $52.00) multiplied
by the fraction of a share of Acquiror Common Stock to which such holder would
otherwise be entitled. The fractional share interests of each Target stockholder
shall be aggregated, so that no Target stockholder shall receive cash in an
amount greater than the value of one full share of Acquiror Common Stock.
6. The conversion of Target Common Stock and Target Preferred Stock
into Acquiror Common Stock as provided by this Merger Agreement shall occur
automatically at the Effective Time of the Merger without action by the holders
thereof. Each holder of Target Common Stock shall thereupon be entitled to
receive shares of Acquiror Common Stock in accordance with the Agreement and
Plan of Reorganization.
7. All the Effective Time of the Merger, the separate existence of
Target shall cease, and Acquiror shall succeed, without other transfer, to all
of the rights and properties of Target and shall be subject to all the debts and
liabilities thereof in the same manner as if Acquiror had itself incurred them.
All rights of creditors and all liens upon the property of each corporation
shall be preserved unimpaired, provided that such liens upon property of Target
shall be limited to the property affected thereby immediately prior to the
Effective Time of the Merger.
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8. This Merger Agreement is intended as a plan of reorganization within
the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended.
9. The Amended and Restated Articles of Incorporation of Acquiror in
effect immediately prior to the Effective Time shall be the Amended and
Restated Articles of Incorporation of the Surviving Corporation unless and
until thereafter amended.
10. The Bylaws of Acquiror in effect immediately prior to the Effective
Time shall be the Bylaws of the Surviving Corporation unless and until amended
or repealed as provided by applicable law, the Articles of Incorporation of the
Surviving Corporation and such Bylaws.
11. The directors and officers of Acquiror immediately prior to the
Effective Time shall be the directors and officers of the Surviving Corporation.
12. Notwithstanding the approval of this Merger Agreement by the
stockholders of Target, this Merger Agreement shall terminate forthwith in the
event that the Agreement and Plan of Reorganization shall be terminated as
therein provided.
13. In the event of the termination of this Merger Agreement as provided
above, this Merger Agreement shall forthwith become void and there shall be no
liability on the part of Target or Acquiror or their respective officers or
directors, except as otherwise provided in the Agreement and Plan of
Reorganization.
14. This Merger Agreement may be signed in one or more counterparts, each
of which shall be deemed an original and all of which shall constitute one
agreement.
15. This Merger Agreement may be amended by the parties hereto any time
before or after approval hereof by the stockholders of Target, but, after such
approval, no amendments shall be made which by law require the further approval
of such stockholders without obtaining such approval. This Merger Agreement may
not be amended except by an instrument in writing signed on behalf of each of
the parties hereto.
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IN WITNESS WHEREOF, the parties have executed this Merger Agreement as of
the date first written above.
CISCO SYSTEMS, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx,President
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, Secretary
COMPATIBLE SYSTEMS CORPORATION
By: /s/ Xxxx XxXxxxxxx
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Xxxx XxXxxxxxx, President
By: /s/ Xxx Xxxxxx
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Xxx Xxxxxx, Secretary
[SIGNATURE PAGE TO AGREEMENT OF MERGER]
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