Exhibit 2
STANDSTILL AGREEMENT
This STANDSTILL AGREEMENT (this "Agreement") is dated as of
September 26, 2001 among Xxxxxxxxxxx Communications Incorporated, a Delaware
corporation, and Xxxxx X. Xxxxxx (collectively, the "Xxxxxxxxxxx Stockholders"),
and Xxxxxx Xxxxxxxx, Xxxxx Xxxxxxxx and SPRI, Ltd. (collectively, the
"Management Stockholders").
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
SECTION 1. DEFINITIONS. In addition to the terms defined elsewhere
herein, when used herein the following terms shall have the meanings indicated:
"AFFILIATE" of a Person means any other Person controlling,
controlled by or under common control with such Person, whether by ownership of
voting securities, by contract or otherwise.
"BOARD" means the Company's Board of Directors.
"COMMON STOCK" means the Company's common stock, par value $.01 per
share.
"COMPANY" means Leapnet, Inc., a Delaware corporation.
"OWNERSHIP PERCENTAGE" means at any time, the ratio expressed as a
percentage of (i) the total number of shares of Common Stock beneficially owned
by the Xxxxxxxxxxx Stockholders to (ii) the total number of shares of
outstanding Common Stock, calculated on a fully-diluted basis.
"PERSON" means any individual, corporation, partnership, firm, joint
venture, association, limited liability company, joint-stock company, trust,
unincorporated organization, governmental or regulatory body or other legal
entity.
"PERMITTED OWNERSHIP LIMIT" means the number of shares of Common
Stock representing an Ownership Percentage of 20%.
"SPECIAL COMMITTEE" means any special committee formed or appointed
by the Board for the purpose of considering the SPRI Proposal.
"SPRI" means SPRI, Ltd., a Delaware corporation.
"SPRI PROPOSAL" means any proposal submitted to the Company by the
Management Stockholders prior to November 30, 2001, seeking, offering or
proposing to effect, (i) any acquisition of any securities (or beneficial
ownership thereof) or assets of the Company, or any
of its subsidiaries; (ii) any tender or exchange offer or merger or other
business combination involving the Company or any of its subsidiaries, (iii) any
recapitalization, restructuring, liquidation, dissolution or other extraordinary
transaction with respect to the Company or any of its subsidiaries or (iv) any
"solicitation" of "proxies" (as such terms are used in the proxy rules of the
Securities and Exchange Commission) or consents to vote any voting securities of
the Company.
"SUBSIDIARY" means, with respect to any Person, any other Person of
which at least a majority of the outstanding shares or other equity interests
having ordinary voting power for the election of directors or comparable
managers of such Person are owned, directly or indirectly, by the first Person
or one or more Subsidiaries of such first Person.
SECTION 2. STANDSTILL AGREEMENT. The Xxxxxxxxxxx Stockholders,
including its Affiliates, agree that until this Agreement is terminated in
accordance with Section 3 hereof, they will not in any manner, directly or
indirectly, (a) bid for or acquire any securities of the Company (or beneficial
ownership thereof) in excess of the Permitted Ownership Limit; (b) effect or
seek, offer or propose (whether publicly or otherwise) to effect, or cause or
participate in or in any way assist any other person to effect or seek, offer or
propose (whether publicly or otherwise) to effect or participate in, (i) any
acquisition of any securities (or beneficial ownership thereof) in excess of the
Permitted Ownership Limit or assets of the Company, or any of its subsidiaries,
except as contemplated in the SPRI Proposal; (ii) any tender or exchange offer
or merger or other business combination involving the Company or any of its
subsidiaries, (iii) any recapitalization, restructuring, liquidation,
dissolution or other extraordinary transaction with respect to the Company or
any of its subsidiaries or (iv) any "solicitation" of "proxies" (as such terms
are used in the proxy rules of the Securities and Exchange Commission) or
consents to vote any voting securities of the Company, except in favor of the
SPRI Proposal, (c) form, join or in any way participate in a "group" (as defined
under the Securities Exchange Act of 1934, as amended), with respect to the
securities of the Company, except as contemplated by this Agreement and the
transactions contemplated hereby, (d) otherwise act, alone or in concert with
others, to seek to control or influence the management, Board or policies of the
Company, (other than acting as a shareholder or director in the ordinary
course), (e) take any action (other than as required by the Securities Exchange
Act of 1934, as amended) which might force the Company to make a public
announcement regarding any of the types of matters set forth in (a) through (d)
above, (f) advise, assist or encourage any other persons in connection with the
foregoing, or (g) enter into any discussions or arrangements with any third
party (other than the Board, any committee of the Board or any representative of
the Company) with respect to any of the foregoing.
SECTION 3. TERMINATION.
(a) In the event the SPRI Proposal is rejected by the Special
Committee, this Agreement will terminate ninety (90) days after such rejection;
(b) In the event the SPRI Proposal is not rejected but the related
SPRI contract is not executed by the Company within sixty (60) days after the
date of this Agreement, this Agreement will terminate ninety (90) days after the
expiration of such sixty (60) days;
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(c) In the event the related SPRI contract is signed by the Company
within ninety (90) days after the date of this Ageement, this Agreement will
terminate (i) sixty (60) business days after the date such contract is
terminated according to its terms, or (ii) on the date the transactions
contemplated by such contract (as it may be amended) are consummated.
(d) Notwithstanding any other provision of this Agreement, if the
Board approves a transaction with any person other than the Management
Stockholders or the Xxxxxxxxxxx Stockholders, or their respective Affiliates
that would result in such person beneficially owning 25% or more of the Common
Stock of the Company or any securities convertible into Common Stock of the
Company, or any options, warrants or other rights to acquire Common Stock of the
Company (or a successor to the Company in a merger, consolidation transaction,
reorganization or any similar transaction) or all or substantially all of its
assets, or any person or "group" (as defined in the Securities Exchange Act of
1934, as amended) has commenced or publicly announced its intention to commence
a tender offer for 25% or more of the outstanding Common Stock of the Company or
any securities convertible into Common Stock of the Company, or any options,
warrants or other rights to acquire Common Stock of the Company or (i) the
Company shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or the Company shall make a general assignment
for the benefit of its creditors; or (ii) there shall be commenced against the
Company any case, proceeding or other action of a nature referred to in clause
(i) above that (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed, undischarged or unbonded
for a period of 60 days; or (iii) there shall be commenced against the Company
any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) the Company shall
take any action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above,
then this Agreement shall terminate immediately.
(e) In the event the Xxxxxxxxxxx Stockholders are no longer in
discussions about the SPRI Proposal with the Management Stockholders, the
Company or the Board, this Agreement will terminate sixty (60) days after such
termination of discussions.
SECTION 4. AMENDMENT AND WAIVER. Except as otherwise provided
herein, no amendment or waiver of any provision of this Agreement shall be
effective unless such amendment or waiver is approved in writing by the
Xxxxxxxxxxx Stockholders and the Management Stockholders. The failure of any
party to enforce any provision of this Agreement shall not be construed as a
waiver of such provision and shall not affect the right of such party thereafter
to enforce each provision of this Agreement in accordance with its terms.
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SECTION 5. SEVERABILITY. If any provision of this Agreement is held
to be invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other provision or any other jurisdiction, but this
Agreement shall be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision had never been contained
herein.
SECTION 6. ENTIRE AGREEMENT. Except as otherwise expressly set forth
herein, this document embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
SECTION 7. SUCCESSORS AND ASSIGNS. Except as otherwise provided in
this Section 7, this Agreement shall bind and inure to the benefit of and be
enforceable by the Xxxxxxxxxxx Stockholders and the Management Stockholders and
their respective permitted successors and assigns so long as such Xxxxxxxxxxx
Stockholders and the Management Stockholders and their respective permitted
successors and assigns hold Common Stock.
SECTION 8. COUNTERPARTS. This Agreement may be executed in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
SECTION 9. GOVERNING LAW. The corporate law of Delaware shall govern
all issues concerning the relative rights of the Company and its stockholders.
All other questions concerning the construction, validity and interpretation of
this Agreement shall be governed by the internal law, and not the law of
conflicts, of Delaware.
SECTION 10. DESCRIPTIVE HEADINGS. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
SECTION 11. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
[END OF PAGE]
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
XXXXXXXXXXX STOCKHOLDERS:
XXXXXXXXXXX COMMUNICATIONS INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President and Chief Operating Officer
/s/ Xxxxx X. Xxxxxx
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XXXXX X. XXXXXX
MANAGEMENT STOCKHOLDERS:
/s/ Xxxxxx Xxxxxxxx
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XXXXXX XXXXXXXX
/s/ Xxxxx Xxxxxxxx
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XXXXX XXXXXXXX
SPRI, LTD.
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
Title: President
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