EXECUTION COPY
VOTING AGREEMENT
This Voting Agreement (the "Agreement"@) is made and entered
into as of May __, 1999, among Silicon Bandwidth, Inc., a Delaware
corporation ("Purchaser"), each undersigned shareholder
("shareholder") of The Panda Project, Inc., a corporation existing
under the laws of Florida ("Seller"), and Seller.
RECITALS
WHEREAS, pursuant to a letter of agreement dated as of even
date herewith, by and between Purchaser and Seller (such agreement as
it may be amended or restated is hereinafter referred to as the
"Letter Agreement"), the parties agreed that on the signing of the
Letter Agreement, Purchaser and each Shareholder would execute and
deliver a Voting Agreement containing the terms and conditions set
forth in the Letter Agreement together with such other terms and
conditions as may be agreed to by the parties to the Letter Agreement
acting reasonably;
WHEREAS, a special committee of the board of directors of
Seller has determined that the transactions contemplated by the Letter
Agreement are fair to, and in the best interests of, the shareholders
of Seller and has approved such transactions;
WHEREAS, Purchaser has agreed to acquire substantially all of
the assets of Seller (the "Acquisition") in exchange for common stock
of Purchaser ("Purchaser Common Stock") and the assumption of certain
Seller liabilities by Purchaser;
WHEREAS, in order to induce Purchaser to consummate the
Acquisition, Seller has agreed to use its best efforts to solicit the
proxy of certain shareholders of Seller on behalf of Purchaser, and to
cause certain shareholders of Seller to execute and deliver voting
agreements to Purchaser;
WHEREAS, each Shareholder is the registered and beneficial
owner of at least such number of (i) shares of the outstanding capital
stock of Seller as is indicated on the signature page of this
Agreement (the "Shares") and/or (ii) securities convertible into or
exercisable for shares of capital stock of Seller as indicated on the
signature page of the Agreement (the "Share Equivalents");
WHEREAS, Helix (PEI), Inc. ("Helix") is an undersigned
Shareholder and holder of a security interest in certain assets of
Seller (the "Security Interest"); and
WHEREAS, in order to induce Purchaser to consummate the
Acquisition, Helix and Seller have agreed to renegotiate the terms of
the Security Interest.
NOW, THEREFORE, the parties agree as follows:
1. Share Ownership and Agreement to Retain Shares.
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1.1 Transfer and Encumbrance.
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(a) Purchaser acknowledges and agrees that, subject
to Section 1.2 hereof, this Agreement only pertains to the number of
Shares and Share Equivalents indicated on the signature page and that
Shareholder may be the beneficial owner of Shares and Share
Equivalents which are not subject to this Agreement.
(b) Each Shareholder is the beneficial owner of
that number of Shares and Share Equivalents set forth opposite such
Shareholder's name on the signature page hereto and, except as
otherwise set forth on the signature page hereto, has held such Shares
and Share Equivalents at all times since the date set forth on such
signature page. No other person or entity not a signatory to this
Agreement has a beneficial interest in or a right to acquire such
Shares or Share Equivalents or any portion of such Shares or Share
Equivalents. The Shares and Share Equivalents are and will be at all
times up until the Expiration Date free and clear of any liens,
claims, options, charges or other encumbrances.
(c) Each Shareholder agrees not to transfer (except
as may be specifically required by this Agreement, court order or by
operation of law), sell, exchange, pledge or otherwise dispose of or
encumber the Shares, Share Equivalents or any New Shares (as defined
below), or to make any offer or agreement relating thereto, at any
time prior to the Expiration Date. As used herein, the term
"Expiration Date" shall mean the earlier to occur of (i) the Closing
Date (as defined in the Letter Agreement) of the Acquisition, and (ii)
six months after the date of the termination of the Letter Agreement.
1.2 New Shares. Each Shareholder agrees that to the extent
necessary to achieve approval of such matters (if it is described in
Section (a)(i) or rejection of such matters described in Section
2(a)(ii)) shares of capital stock of Seller that such Shareholder
purchases or with respect to which such Shareholder otherwise acquires
beneficial ownership after the date of this Agreement and prior to the
Expiration Date ("New Shares") (such New Shares to exclude an
aggregate of 1,057,471 shares of Common Stock of Seller to be issued
to AGR Halifax Fund, Ltd., Leonardo, L.P., GAM Arbitrage Investments,
Inc., AG Super Fund International Partners, L.P., Raphael, L.P. and
Ramius Fund, L.P. upon the conversion of 27.6 shares of Series A
Preferred Stock of Seller) shall be subject to the terms and
conditions of this Agreement to the same extent as if they constituted
Shares.
2. Agreements Regarding Shares and Share Equivalents.
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(a) Prior to the Expiration Date, at every meeting
of the shareholders of Seller called with respect to any of the
following, and at every adjournment thereof, and on every action or
approval by written resolution of the shareholders of Seller with
respect to any of the following, each Shareholder shall vote the
Shares and any New Shares (i) in favor of approval of the Acquisition
and any matter that could reasonably be expected to facilitate the
Acquisition and (ii) against any proposal for any recapitalization,
merger, sale of assets or other business combination (other than the
Acquisition) between Seller and any person or entity other than
Purchaser.
(b) Prior to the record date set for the first
shareholders meeting relating to any matter covered by Section 2(a)
above, each undersigned holder of Share Equivalents shall exercise or
convert such number of Share Equivalents, as the case may be, into
capital stock of Seller, pro rata in the amount determined by
Purchaser to be necessary to achieve approval of such matters (if it
is described in Section 2(a)(i)) or rejection of such matters (if it
is described in Section 2(a)(ii)), and vote such shares as set forth
in Section 2(a) above.
3. Irrevocable Proxy. Each Shareholder is hereby
delivering to Purchaser a duly executed proxy in the form attached
hereto as Exhibit 1 (the "Proxy") with respect to each meeting of
shareholders of Seller, such Proxy to cover the total number of Shares
and New Shares in respect of which each Shareholder is entitled to
vote at any such meeting. Upon the execution of this Agreement by
each Shareholder, each Shareholder hereby revokes any and all prior
proxies given by it with respect to the Shares and agrees not to grant
any subsequent proxies with respect to the Shares or any New Shares
until after the Expiration Date.
4. Agreements Regarding Security Interest.
(a) Prior to the record date set for the first
shareholders meeting relating to any matter covered by Section 3(a)
above, Seller and Helix shall enter into an agreement to restructure
the indebtedness of Seller (the "Secured Debt") currently secured by
Helix's security interest in certain assets of Seller in the form
attached hereto as Exhibit 2 (the "Restructuring Agreement"), and
effective as of the Closing Seller and Helix shall effectuate such
restructuring.
(b) The Restructuring Agreement shall provide that
(i) Helix shall release its security interest in all assets of Seller
other than its intellectual property assets and (ii) the terms of the
Secured Debt shall be modified so that (A) the Secured Debt accrues
interest after the Closing at a rate of 6% per annum, calculated on a
monthly basis, (B) any interest accrued with respect to the Secured
Debt prior to the Closing is forgiven by Helix and (C) the Secured
Debt shall be subject to (x) a principal payment obligation of
$1,000,000 immediately after the Closing and (y) principal and
interest payments aggregating $100,000 per month on each of the
monthly anniversaries of the Closing (and such lesser amount on the
eleventh monthly anniversary of the Closing as shall satisfy all
remaining principal and interest on the Secured Debt).
5. Representations and Warranties of Shareholder. Each
Shareholder hereby represents and warrants to Purchaser as follows:
(a) such Shareholder has all requisite power and authority to enter
into this Agreement and to consummate the transactions contemplated
hereby; (b) this Agreement has been duly authorized, executed and
delivered by such Shareholder and constitutes a valid and binding
obligation of such Shareholder enforceable against such Shareholder in
accordance with its terms; (c) if such Shareholder is a natural person
and is married, and the Shares constitute community property or
otherwise need spousal or other approval for this Agreement to be
legal, valid and binding, this Agreement has been duly authorized,
executed and delivered by, and constitutes a valid and binding
agreement of, such Shareholder's spouse, enforceable against such
spouse in accordance with its terms, and (d) no trust of which such
Shareholder is a trustee requires the consent of any beneficiary to
the execution and delivery of this Agreement or to the consummation of
the transactions contemplated hereby.
6. Additional Documents. Each Shareholder hereby covenants
and agrees to execute and deliver any additional documents reasonably
required for the consummation of the Acquisition or to carry out the
purpose and intent of this Agreement.
7. Consent and Waiver. Each Shareholder hereby gives any
consents or waivers that are reasonably required for the consummation
of the Acquisition under the terms of any agreement to which such
Shareholder is a party or pursuant to any rights such Shareholder may
have.
8. Termination. This Agreement and the Proxy delivered in
connection herewith shall terminate and shall have no further force or
effect as of the Expiration Date.
9. Miscellaneous.
9.1 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, then the remainder
of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected,
impaired or invalidated.
9.2 Binding Effect and Assignment. This Agreement and
all of the provisions hereof shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and
permitted assigns, but, except as otherwise specifically provided
herein, neither this Agreement nor any of the rights, interests or
obligations of the parties hereto may be assigned by either of the
parties without the prior written consent of the other. This
Agreement is intended to bind each Shareholder as a shareholder of
Seller only with respect to the specific matters set forth herein.
9.3 Amendment and Modification. This Agreement may not
be modified, amended, altered or supplemented except by the execution
and delivery of a written agreement executed by the parties hereto.
9.4 Specific Performance; Injunctive Relief. The
parties hereto acknowledge that Purchaser will be irreparably harmed
and that there will be no adequate remedy at law for a violation of
any of the covenants or agreements of each Shareholder set forth
herein. Therefore, it is agreed that, in addition to any other
remedies that may be available to Purchaser upon any such violation,
Purchaser shall have the right to enforce such covenants and
agreements by specific performance, injunctive relief or by any other
means available to Purchaser at law or in equity and each Shareholder
hereby waives any and all defenses which could exist in its favor in
connection with such enforcement and waives any requirement for the
security or posting of any bond in connection with such enforcement.
9.5 Notices. All notices, requests, demands or other
communications that are required or may be given pursuant to the terms
of this Voting Agreement shall be in writing and shall be deemed to
have been duly given upon receipt by delivery in person, by telecopy
or facsimile, by registered or certified mail or by a nationally
recognized courier service to the respective parties as follows:
(a) If to a Shareholder, at the address set forth
below such Shareholder's signature at the end hereof.
(b) if to Purchaser, to:
Silicon Bandwidth, Inc.
0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxx, Phleger & Xxxxxxxx LLP
Xxx Xxxxxx Xxxxx
Xxxxx Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Facsimile No.: (000) 000-0000
(c) if to Seller, to:
The Panda Project
000 Xxxxxx Xxxxx Xxxxxxx
Xxxx Xxxxx, XX 00000
with a copy to:
5300 First Union Financial Center
000 Xxxxx Xxxxxxxx Xxxx.
Xxxxx, XX 00000-0000
Attention: Xxxx Xxxxxxxx
Facsimile No.: (000) 000-0000
or to such other address as any party hereto may designate for itself
by notice given as herein provided.
9.6 Governing Law. This Agreement shall be governed
by, construed and enforced in accordance with the laws of the State of
New York, except to the extent mandatorily governed by the laws of the
State of Florida.
9.7 Entire Agreement. This Agreement and the Proxy
contain the entire understanding of the parties in respect of the
subject matter hereof, and supersede all prior negotiations and
understandings between the parties with respect to such subject
matter.
9.8 Counterpart. This Agreement may be executed in
several counterparts, each of which shall be an original, but all of
which together shall constitute one and the same agreement.
9.9 Effect of Headings. The section headings herein
are for convenience only and shall not affect the construction or
interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Voting Agreement
to be executed as of the date first above written.
SILICON BANDWIDTH, INC. SHAREHOLDER
By:
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(Signature)
Name:
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(Print Name)
Title:
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(Print Address)
THE PANDA PROJECT, INC.
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(Print Address)
By:
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(Print Telephone Number)
Name:
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Title:
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(Social Security or Tax I.D. Number)
Total Number of Shares and Share Equivalents owned on the date hereof:
Common Stock:
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Series A Preferred Stock:
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(Print type of Share Equivalents) (Number of Share Equivalents)
[SIGNATURE PAGE TO VOTING AGREEMENT]
EXHIBIT 1
IRREVOCABLE PROXY
TO VOTE STOCK OF
SELLER
The undersigned shareholder of The Panda Project, Inc., a
Florida corporation ("Seller"), hereby irrevocably (to the full extent
permitted by the Florida Business Corporations Act) appoints the
members of the Board of Directors of Silicon Bandwidth, Inc., a
Delaware corporation ("Purchaser"), and each of them, or any other
designee of Purchaser, as the sole and exclusive attorneys and proxies
of the undersigned, with full power of substitution and
resubstitution, to vote and exercise all voting and related rights (to
the full extent that the undersigned is entitled to do so) with
respect to all of the shares of capital stock of Seller that now are
or hereafter may be beneficially owned by the undersigned, and any and
all other shares or securities of Seller issued or issuable in respect
thereof on or after the date hereof (collectively, the "Shares") in
accordance with the terms of this Irrevocable Proxy. The Shares
beneficially owned by the undersigned shareholder of Seller as of the
date of this Irrevocable Proxy are listed on the final page of this
Irrevocable Proxy. Upon the undersigned's execution of this
Irrevocable Proxy, any and all prior proxies given by the undersigned
with respect to any Shares are hereby revoked and the undersigned
agrees not to grant any subsequent proxies with respect to the Shares
until after the Expiration Date (as defined below).
This Irrevocable Proxy is irrevocable (to the extent provided
in the Florida Business Corporations Act), is coupled with an
interest, including, but not limited to, that certain Voting Agreement
dated as of even date herewith by and among Purchaser, Seller, and the
undersigned, and is granted in consideration of Purchaser entering
into that certain letter agreement dated of even date herewith between
Seller and Purchaser (the "Letter Agreement"), which agreement
provides for the acquisition by Purchaser of substantially all of the
assets of Seller (the "Acquisition"). As used herein, the term
"Expiration Date" shall mean the earlier to occur of (i) such date and
time as the Acquisition shall become effective in accordance with the
terms and provisions of the Letter Agreement, and (ii) six months
after the date of termination of the Letter Agreement.
The attorneys and proxies named above, and each of them are
hereby authorized and empowered by the undersigned, at any time prior
to the Expiration Date, to act as the undersigned's attorney and proxy
to vote the Shares, and to exercise all voting and other rights of the
undersigned with respect to the Shares (including, without limitation,
the power to execute and deliver written consents pursuant to the
Florida Business Corporations Act), at every annual, special or
adjourned meeting of the shareholders of Seller and in every written
consent in lieu of such meeting (i) in favor of approval of the
Acquisition, in favor of any matter that could reasonably be expected
to facilitate the Acquisition and against any proposal for any
recapitalization, merger, sale of assets or other business combination
relating to the Seller (other than the Transaction) and (ii) against
any other action or agreement that would result in a breach of any
covenant, representation or warranty or any other obligation or
agreement of Seller under an acquisition agreement in respect of the
Transaction or which would result in any of the conditions to the
completion of the Transaction not being fulfilled.
The attorneys and proxies named above may not exercise this
Irrevocable Proxy on any other matter except as provided above. The
undersigned shareholder may vote the Shares on all other matters.
All authority herein conferred shall survive the death or
incapacity of the undersigned and any obligation of the undersigned
hereunder shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
This Irrevocable Proxy is coupled with an interest as
aforesaid and is irrevocable.
Dated: May __, 1999
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(Signature of Shareholder)
(Print Name of Shareholder)
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Shares beneficially owned:
_________ shares of Common Stock of Seller
_________ shares of Series A Preferred Stock
of Seller
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(Print type and number of Share Equivalents)
[SIGNATURE PAGE TO IRREVOCABLE PROXY]
Exhibit 2
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Restructuring Agreement
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