SHARE AGREEMENT May 21, 2007
Exhibit (d)(2)
May 21, 2007
Reference is made to the Agreement and Plan of Merger (the “Merger Agreement”), by and
among Oreo Acquisition Co., LLC, a Delaware limited liability company (including its successors and
assigns under the Merger Agreement, “Buyer”), Bridgeport Networks, Inc., a Delaware
corporation (the “Corporation”), Harbinger Capital Partners Master Fund I, Ltd., a Cayman
Islands corporation and Harbinger Capital Partners Special Situations Fund, L.P., a Delaware
limited partnership (together “Harbinger”), Polaris Venture Partners IV, L.P., Polaris
Venture Partners Entrepreneurs’ Fund IV, L.P., General Catalyst Group II, L.P., GC Entrepreneurs
Fund II, L.P., Toronto Dominion Capital (U.S.A.), Inc., and BCE, Inc. (each, an “Investor”
and, collectively, the “Investors”), Xxxxxxx Xxxxxx, Xxxxxx Xxxxxx, Xxxx Xxxxxxxxx, Xxxxxx
Xxxxxxxxxx, Xxxxxx Xxx and Xxxxx xx Xxxxxxxx (each, an “Executive”, and collectively, the
“Executives”, and together with the Investors, each, a “Seller” and collectively,
the “Sellers”). Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Merger Agreement.
(a) Simultaneously with the Effective Time, the Investors shall purchase shares of Openwave
Common Stock from the Buyer for an aggregate purchase price of $4,000,000. Each Investor shall
purchase from Buyer, and Buyer shall sell to such Investor, at the final price per share paid in
the consummated Tender Offer, the percentage of the securities required to be purchased pursuant to
this paragraph (a) as is set forth opposite such Investor’s name on Annex I.
(b) In the event that, after the Effective Time and prior to the twelve-month anniversary of
the Effective Time, Openwave declares and pays a cash dividend on shares of Openwave Common Stock
(a “Post-Closing Dividend”), each Executive shall purchase from Buyer, and Buyer shall sell
to such Executive, for a purchase price equal to the Post-Closing Dividend paid to such Executive
less the Executive’s Post-Closing Dividend Tax Liability as determined below (the “Executive’s
After-Tax Dividend”) that number of shares of Openwave Common Stock determined by dividing (x) the
Executive’s After-Tax Dividend by the (y) volume weighted average price per share (the
“Post-Dividend Price”) of the Openwave Common Stock over the five trading days commencing
the trading day after the payment date of such dividend. Such purchase shall occur on the trading
day immediately following such fifth trading day. Harbinger shall notify each Executive of the
amount of the Post-Closing Dividend to be paid to such Executive prior to the date the Post-Closing
Dividend is payable, and shall provide to each Executive a copy of this Share Agreement (this
“Agreement”) together with a letter reminding such Executive of his obligation to provide
the notice set forth in this paragraph (b). With respect to each Executive, the Executive’s
Post-Closing Dividend Tax Liability shall be an amount equal to the federal, state and local income
taxes payable by the Executive in connection with its receipt of the Post-Closing Dividend. The
Executive will provide to Harbinger no later than the later of (A) three (3) business days prior to
the date the Post-Closing Dividend is payable or (B) fifteen (15) business days following receipt
of the notice from Harbinger described in the preceding sentence, a letter calculating the
Executive’s tax liability in
connection with such Post-Closing Dividend, which letter shall reflect (i) the Executive’s estimated tax basis
in its Openwave Common Stock on the date the Post-Closing Dividend will be paid, (ii) the date the
Executive’s holding period in their Openwave Common Stock began for U.S. federal income tax
purposes and (iii) the federal, state and local income tax rates used to compute the Executive’s
Post-Closing Dividend Tax Liability. Each Executive shall determine the Executive’s Post-Closing
Dividend Tax Liability based upon the information provided to him in the Notice described in
paragraph (c) of this Agreement. In the event that the amount of the Post-Closing Dividend
reported by Openwave as a dividend differs from the amount provided in the Notice and such
difference results in a change in the Executive’s Post-Closing Dividend Tax Liability, if the
difference results in an increased tax liability for the Executive, Harbinger shall purchase shares
from such Executive, and if the difference results in a decreased tax liability for th Executive,
the Executive shall purchase shares from Harbinger, in each case, in the same manner as provided
for in paragraph (c) based upon a purchase price equal to such difference in the Executive’s
Post-Closing Dividend Tax Liability. The Letter provided by an Executive to Harbinger pursuant to
this paragraph (b) shall be treated as correct absent clear error. If an Executive does not
provide a letter to Harbinger at the time and in the manner provided for in this paragraph (b) such
Executive’s Post-Closing Dividend Tax Liability shall be treated as zero.
(c) Not later than 10 days prior to the payment of any Post-Closing Dividend, Harbinger shall
cause Openwave to provide the Sellers a notice (the “Notice”) indicating whether Openwave
reasonably expects that it will have current year “earnings and profits” (as defined in the
Internal Revenue Code) or accumulated earnings and profits and, if the Notice indicates that any
earnings and profits are expected, the portion, of such Post-Closing Dividend which Openwave
reasonably expects will be treated as a dividend for U.S. federal income tax purposes. The
Investors shall purchase shares of Openwave Common Stock from Harbinger for a purchase price equal
to (X) 60% of the amount of the Post-Closing Dividend that is treated as a dividend for U.S.
federal income tax purposes in the Notice plus (Y) 100% of the amount of such distribution
in excess of the amount treated as a dividend for U.S. federal income tax purposes pursuant to the
Notice, at a price per share equal to the Post-Dividend Price. In the event that the amount of the
distribution actually reported as a dividend by Openwave is higher than that provided in the
Notice, Harbinger shall, at the election of each Investor (an “Electing Investor”), repurchase
shares from each Electing Investor at the Post-Dividend Price for an aggregate purchase price equal
to the difference between the total purchase price paid by each Electing Investor in purchasing
shares pursuant to this paragraph (c) and the amount that each Electing Investor would have paid if
the amount treated as a dividend for U.S. tax purposes in the Notice provided by Openwave had been
equal to the amount actually reported as such. Such repurchase would occur at a date specified by
the Electing Investor not later than 200 days after the determination of the amount of the
distribution actually reported as a dividend.
(d) In the event of any purchase by the Sellers of shares of Openwave Common Stock from the
Buyer pursuant to this Agreement, as promptly as practicable following such a purchase, Harbinger
shall use its reasonable best efforts to cause Openwave to file and maintain the effectiveness of a
shelf registration statement allowing for the resale of such shares of Openwave Common Stock until
such time as such shares may be sold without restriction pursuant to Rule 144(k) under the Exchange
Act.
(e) Any provision of this Agreement may be amended or waived if such amendment or waiver is in
writing and is signed, (i) in the case of a waiver, by the party against whom the waiver is to be
effective, or (ii) in the case of any amendment, by Harbinger and a majority-in-interest of the
Sellers, provided, however, that any such amendment which treats the Executives in a manner which
is materially different and adverse from the Investors shall also require the approval of a
majority-in-interest of the Executives. A majority-in-interest shall be determined based upon the
number of outstanding shares of Openwave Common Stock held by each Seller.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.
| OREO ACQUISITION CO., LLC |
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| By: | /s/ Xxxxxxx X. Xxxxx, Xx. | |||
| Name: | Xxxxxxx X. Xxxxx, Xx. | |||
| Title: | Vice President | |||
| HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD. |
||||
| By: | Harbinger Capital Partners Offshore Manager, L.L.C. | |||
| By: | HMC Investors, L.L.C., Managing Member | |||
| By: | /s/ Xxxxxxx X. Xxxxx, Xx. | |||
| Name: | Xxxxxxx X. Xxxxx, Xx. | |||
| Title: | Executive Vice President | |||
| HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS FUND, L.P. |
||||
| By: | Harbinger Capital Partners Special Situations GP, LLC | |||
| By: | HMC - New York, Inc., Managing Member | |||
| By: | /s/ Xxxxxxx X. Xxxxx, Xx. | |||
| Name: | Xxxxxxx X. Xxxxx, Xx. | |||
| Title: | Executive Vice President | |||
| POLARIS VENTURE PARTNERS IV, L.P. |
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| By: | /s/ J. Xxxxxx Xxxxxx | |||
| Name: | J. Xxxxxx Xxxxxx | |||
| Title: | General Partner | |||
| POLARIS VENTURE PARTNERS ENTREPRENEURS’ FUND IV, L.P. |
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| By: | /s/ J. Xxxxxx Xxxxxx | |||
| Name: | J. Xxxxxx Xxxxxx | |||
| Title: | General Partner | |||
| GENERAL CATALYST GROUP II, L.P. |
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| By: | General Catalyst Partners II, LP its General Partner | |||
| By: | General Catalyst XX XX, LLC its General Partner | |||
| By: | /s/ Xxxxxxx X. Xxxxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxxxx | |||
| Title: | Member & CFO | |||
| GC ENTREPRENEURS FUND II, L.P. |
||||
| By: | General Catalyst Partners II, LP its General Partner | |||
| By: | General Catalyst XX XX, LLC its General Partner | |||
| By: | /s/ Xxxxxxx X. Xxxxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxxxx | |||
| Title: | Member & CFO | |||
| TORONTO DOMINION CAPITAL (U.S.A.), INC. |
||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxx | |||
| Title: | Vice President | |||
| BCE, INC. |
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| By: | /s/ Xxxx Xxxxxxxx | |||
| Name: | Xxxx Xxxxxxxx | |||
| Title: | Managing Director | |||
| XXXXXXX XXXXXX |
||||
| /s/ Xxxxxxx Xxxxxx | ||||
| XXXXXX XXXXXX |
||||
| /s/ Xxxxxx Xxxxxx | ||||
| XXXXXX XXXXXXXXXX |
||||
| /s/ Xxxxxx Xxxxxxxxxx | ||||
| XXXX XXXXXXXXX |
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| /s/ Xxxx Xxxxxxxxx | ||||
| XXXXXX XXX |
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| /s/ Xxxxxx Xxx | ||||
| XXXXX XX XXXXXXXX |
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| /s/ Xxxxx xx Xxxxxxxx | ||||
Annex I
Polaris Venture Partners IV, L.P. |
36.69 | % | ||
Polaris Venture Partners Entrepreneurs’ Fund IV, L.P. |
.65 | % | ||
General Catalyst Group II, L.P. |
35.99 | % | ||
GC Entrepreneurs Fund II, L.P. |
1.36 | % | ||
Toronto Dominion Capital (U.S.A.) Inc. |
17.26 | % | ||
BCE, Inc. |
8.05 | % |
