SUPPORT AGREEMENT
EXECUTION
VERSION
This
SUPPORT AGREEMENT, dated August 26, 2017 (this “Agreement”), is entered
into by and among the parties set forth on Schedule I hereto (each a
“Principal
Stockholder” and, collectively, the
“Principal
Stockholders”) and Birch Communications Holdings,
Inc., a Georgia corporation (“BCHI”). The Principal
Stockholders and BCHI are sometimes referred to herein individually
as a “Party” and collectively
as the “Parties.” Capitalized
terms used herein without definition shall have the respective
meanings specified in the Merger Agreement.
RECITALS
A. BCHI,
Fusion Telecommunications International, Inc., a Delaware
corporation (the
“Company”), and Fusion
BCHI Acquisition LLC, a Delaware limited liability company
(“Merger
Sub”), have entered into a Merger Agreement, dated as
of the date hereof (as the same may be amended or modified, the
“Merger
Agreement”), providing, among other things, for the
merger of BCHI with and into Merger Sub, a wholly owned subsidiary
of the Company, and the issuance of common stock, par value $.01
per share, of the Company (the “Common Stock”) to the
shareholders of BCHI, upon the terms and subject to the terms and
conditions set forth in the Merger Agreement.
B. On
the date of this Agreement, each Principal Stockholder is the
beneficial owner of certain Company Common Stock and Company
Preferred Stock as set forth opposite such Principal
Stockholder’s name on Schedule I (collectively, the
“Shares”).
C. The
Shares comprise 10.5% of the issued and outstanding shares of
Common Stock, and represent in the aggregate 9.8% of the votes
entitled to be cast by the holders of Common Stock (the
“Stockholders”) on matters
on which such Stockholders are entitled to vote.
D. As
a condition to its willingness to enter into the Merger Agreement,
BCHI has requested that the Principal Stockholders enter into this
Agreement.
NOW,
THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in
this Agreement and in the Merger Agreement, and intending to be
legally bound hereby, the Parties agree as follows:
1.
Voting; Proxy.
(a) Voting.
Each Principal Stockholder hereby agrees that from and after the
date hereof and until the earlier of (i) the termination of this
Agreement in accordance with its terms, (ii) the termination of the
Merger Agreement in accordance with its terms, (iii) the Effective
Time, (iv) with regard to any Principal Stockholder, the entry by
the Company, without prior written consent of such Principal
Stockholder, into any amendment or modification of the Merger
Agreement which results in (A) a change which is materially adverse
to such Principal Stockholder or (B) the extension of the Outside
Date (except in accordance with Section
8.1(b)(i) of the Merger
Agreement), or (v) the mutual written agreement of the parties
hereto to terminate this Agreement (such earlier date, the
“Expiration
Date”), at any meeting of
the Stockholders, however called, or at any adjournment thereof, or
in any circumstance in which the vote, consent or other approval of
the Stockholders is sought, such Principal Stockholder, if it is
entitled to do so, shall appear at each such meeting or otherwise
cause all of its Covered Shares to be counted as present thereat
for purposes of calculating a quorum and vote its Covered Shares,
or cause its Covered Shares to be voted, (x) for approval of the
Merger Agreement and any transactions contemplated thereby
(including the Merger) and, subject to subclause (iv) above, for
approval of any amendment to the Merger Agreement under
Section
9.5 thereof and (y) against:
(A) any Alternative Proposal, (B) any action that would reasonably
be expected to result in (1) a breach of or failure to perform any
representation, warranty, covenant or agreement of the Company
under the Merger Agreement or (2) any of the conditions set forth
in Article
VII of the Merger Agreement not being satisfied or (C)
any action that would prevent or materially delay or would
reasonably be expected to prevent or materially delay, consummation
of the Merger (clauses (x) and (y), the “Required
Votes”). Except as
explicitly set forth in this Section
1(a), nothing in this Agreement
shall limit the right of any Principal Stockholder to vote
(including by proxy or written consent, if applicable) in favor of,
against or abstain with respect to any matters presented to the
Company’s stockholders.
(b) Irrevocable
Proxy.
(i) From
and after the date of this Agreement until the Expiration Date,
each Principal Stockholder hereby irrevocably grants to, and
appoints, BCHI, and any Person designated in writing by BCHI, and
each of them individually, such Principal Stockholder’s proxy
and attorney-in-fact (with full power of substitution), for and in
the name, place and stead of such Principal Stockholder, to vote
all of the Covered Shares owned by such Principal Stockholder and
entitled to vote as of the applicable record date or grant a
consent or approval in respect of the Covered Shares owned by such
Principal Stockholder and entitled to vote as of the applicable
date, in accordance with the Required Votes; provided, further,
that any grant of such proxy shall only entitle BCHI or its
designee to vote on the matters specified in the definition of
Required Vote, and each such Principal Stockholder shall retain the
authority to vote on all other matters.
(ii) Each
Principal Stockholder hereby represents and warrants to BCHI that
any proxies heretofore given in respect of the Covered Shares owned
by such Principal Stockholder are not irrevocable and that any such
proxies are hereby revoked. Each Principal Stockholder hereby
affirms that the irrevocable proxy set forth in this
Section
1(b) is given in connection
with the execution of the Merger Agreement and that such
irrevocable proxy is given to secure the performance of the duties
of such Principal Stockholder under this Agreement. Each Principal
Stockholder hereby further affirms that the irrevocable proxy
granted herein is coupled with an interest and, except as set forth
in this Section
1(b), is intended to be
irrevocable until the Expiration Date, at which time it will
terminate automatically. Each Principal Stockholder hereby ratifies
and confirms all actions that such irrevocable proxy may lawfully
take or cause to be taken by virtue hereof. If for any reason the
proxy granted herein is not irrevocable, each Principal Stockholder
agrees to vote the Covered Shares owned by it and take such other
required actions in accordance with Section
1(a).
(c) No
Obligation to Exercise Rights or Options. Nothing contained in this Agreement shall
require any Principal Stockholder (or shall entitle any proxy of
any Principal Stockholder) to convert, exercise or exchange any
rights, options, warrants or convertible securities in order to
obtain any underlying new Shares.
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2.
No Disposition or Solicitation.
(a) No
Disposition or Adverse Act.
Each Principal Stockholder hereby covenants and agrees that, from
the date hereof until the earlier of the (i) the Expiration Date or
(y) the date on which the Stockholder Approval is obtained, except
as contemplated by this Agreement and the Merger Agreement, such
Principal Stockholder shall not and shall cause its Representatives
not to (without the prior written consent of BCHI, in its sole
discretion), (i) Transfer any or all of the Covered Shares owned by
such Principal Stockholder or any interest therein or enter into
any Contract, including any option, with respect to any Transfer of
any or all of the Covered Shares owned by such Principal
Stockholder or any interest therein; other than (A)(1) any Transfer
made for estate planning purposes or to a charitable institution
for philanthropic purposes, or (2) any Transfer to an Affiliate of
such Principal Stockholder, but only if, in each case, prior to the
effectiveness of such Transfer, the transferee agrees in writing to
be bound by the applicable terms of this Agreement and written
notice of such Transfer is delivered to BCHI pursuant to
Section
8(e) hereof, (B) a Transfer
pursuant to any trust or will of such Principal Stockholder or by
the laws of intestate succession, or (C) a Transfer solely in
connection with the payment of the exercise price or the
satisfaction of any tax withholding obligations arising from the
exercise of any rights, stock options or warrants or the conversion
of any convertible securities, (iii) grant any proxy,
power-of-attorney or other authorization with respect to any or all
of the Covered Shares owned by such Principal Stockholder that is
inconsistent with this Agreement, (iv) deposit any or all of the
Covered Shares owned by such Principal Stockholder into a voting
trust or enter into a voting agreement or arrangement with respect
to any or all of the Covered Shares owned by such Principal
Stockholder or (v) agree to take any of the actions prohibited by
the foregoing clauses (i)-(iv). Any attempted Transfer of Covered
Shares or any interest therein in violation of this
Section
2(a) shall be null and
void.
(b) No
Solicitation. Prior to the
Expiration Date, each Principal Stockholder hereby agrees that such
Principal Stockholder (solely in its capacity as a stockholder of
the Company) shall not, and shall instruct and cause its
Representatives and controlled Affiliates not to, directly or
indirectly:
(i) initiate,
solicit or knowingly facilitate or encourage any inquiries,
discussions regarding, or the making or submission of, any
proposal, request or offer that constitutes, or could reasonably be
expected to lead to, an Alternative Proposal;
(ii) approve,
endorse, recommend or enter into any Contract or agreement in
principle, whether written or oral, with any Person (other than
BCHI) concerning any letter of intent, memorandum of understanding,
acquisition agreement, merger agreement, joint venture agreement,
partnership agreement or other similar Contract concerning an
Alternative Proposal (other than negotiating and entering into a
confidentiality agreement as described in Section
6.3(a)(iii) of the Merger
Agreement);
(iii) conduct,
engage in, continue or otherwise participate in any discussions or
negotiations to facilitate any proposal that constitutes an
Alternative Proposal;
(iv) furnish
any non-public information relating to the Company or any of the
Company Subsidiaries to any third party that, to the knowledge of
such Principal Stockholder, is seeking to make, or has made, an
Alternative Proposal; or
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(v) resolve
or publicly propose or announce to do any of the
foregoing;
Notwithstanding the foregoing, nothing contained herein shall
prohibit any Principal Stockholder or such Principal
Stockholder’s Representatives or Controlled Affiliates from
providing information or participating in any discussions or
negotiations with respect to a possible stockholders’ consent
or voting agreement in connection with an Alternative Proposal at
such time (and to the extent) that the Company becomes permitted to
take the actions set forth in Section
6.3(a)(ii) of the Merger
Agreement with respect to such Alternative
Proposal.
3.
Capacity
. Each
Principal Stockholder is signing this Agreement solely in such
Principal Stockholder’s capacity as a stockholder of the
Company and nothing contained herein shall in any way limit or
affect such Principal Stockholder (or any Representative of a
Principal Stockholder) from exercising its fiduciary duties as a
director or officer of the Company or any of its Subsidiaries or
from otherwise taking any action or inaction in its capacity as a
director and/or officer of the Company, and no such exercise of
fiduciary duties or action or inaction taken in such capacity as a
director and/or officer shall be deemed to constitute a breach of
this Agreement; provided, that the foregoing shall not limit the
obligations of such Principal Stockholder in its capacity as a
director and/or officer of the Company under the Merger
Agreement.
4.
Additional Agreements.
(a) Certain
Events. In the event of any
share dividend, subdivision, reclassification, recapitalization,
split, split-up, share distribution, combination, exchange of
shares or similar transaction or other change in the capital
structure of the Company affecting the Covered Shares or the
acquisition of Additional Owned Shares by a Principal Stockholder,
(i) the type and number of Covered Shares shall be adjusted
appropriately to reflect the effect of such occurrence and (ii)
this Agreement and the obligations hereunder shall automatically
attach to any additional Covered Shares issued to or acquired by
such Principal Stockholder.
(b) Stop
Transfer; Legends. In
furtherance of this Agreement, each Principal Stockholder hereby
authorizes and instructs the Company (including through the
Company’s transfer agent, if any) to enter a stop transfer
order with respect to all of the Covered Shares and to legend the
certificates, if any, evidencing the Covered Shares. Each Principal
Stockholder agrees that it will instruct the Company, as promptly
as practicable after the date of this Agreement, to (i) make a
notation on its records and give instructions to the transfer
agent, if any, for the Covered Shares not to permit, during the
Term, any Transfer of the Covered Shares and (ii) place (or cause
the transfer agent for the Covered Shares to place) the legend
described below on any certificates evidencing the Covered Shares;
provided, that the Company’s transfer agent shall also be
instructed that the stop transfer order (and all other
restrictions) shall terminate on the earlier of (x) the Expiration
Date and (y) the date on which the Company Stockholder Approval is
obtained.
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“THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON VOTING AND TRANSFER AND
CERTAIN OTHER LIMITATIONS SET FORTH IN THAT CERTAIN SUPPORT
AGREEMENT, DATED AS OF AUGUST 26, 2017,
AMONG THE HOLDER OF THIS CERTIFICATE AND BIRCH COMMUNICATIONS
HOLDINGS, INC. AS THE SAME MAY BE AMENDED FROM TIME TO TIME, A
COPY OF WHICH SUPPORT AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE
OF FUSION TELECOMMUNICATIONS INTERNATIONAL,
INC.
(c) Commencement
or Participation in Actions.
Each Principal Stockholder hereby agrees not to commence or
participate in, and to take all actions necessary to opt out of any
class in, any class action with respect to, any Transaction
Litigation, including any claim (i) challenging the validity of, or
seeking to enjoin the operation of, any provision of this Agreement
or the Merger Agreement, (ii) alleging a breach of any duty of the
Company Board in connection with this Agreement or the Merger
Agreement or the transactions contemplated hereby or thereby or
(iii) making any claim against BCHI, Merger Sub or their
Representatives or Affiliates in connection with the Merger
Agreement or the transactions contemplated thereby, other than a
claim to enforce the Merger Agreement in accordance with its
terms.
(d) Communications.
Unless required by applicable Law, each Principal Stockholder shall
not, and shall cause its Representatives not to, make any press
release, public announcement or other public communication with
respect to this Agreement and the Merger Agreement and the
transactions contemplated hereby and thereby, without the prior
written consent of BCHI. Each Principal Stockholder hereby agrees
to permit the Company to publish and disclose, including in filings
with the SEC, this Agreement and such Principal Stockholder’s
identity and ownership of the Shares and the nature of such
Principal Stockholder’s commitments, arrangements and
understandings under this Agreement.
(e) Additional
Owned Shares. Each Principal
Stockholder hereby agrees to notify BCHI promptly in writing of the
number and description of any Additional Owned Shares acquired by
such Principal Stockholder after the date of this Agreement and
prior to the Expiration Date.
(f) Waiver
of Appraisal Rights and Actions. Each Principal Stockholder hereby waives any
rights of appraisal or rights to dissent from the Merger or the
adoption of the Merger Agreement that such Principal Stockholder
may have under applicable Law, including under Section 262 of the
DGCL, and will not exercise or permit any such rights of appraisal
or rights of dissent to be exercised with respect to the such
Principal Stockholder’s Shares.
(g) Stockholders’
Agreement. Each Principal
Stockholder covenants and agrees to enter into, and timely execute
and deliver, the Stockholders’ Agreement at the
Closing.
5.
Representations and Warranties of the
Principal Stockholders. Each Principal Stockholder
represents and warrants to BCHI as follows:
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(a) Title.
Such Principal Stockholder is the sole beneficial owner of the
Owned Shares reflected for such Principal Stockholder on
Schedule
I hereto. The Owned Shares that
are reflected for such Principal Stockholder on Schedule I hereto
constitute all of the Equity Interests in the Company owned of
record or beneficially by such Principal Stockholder or its
respective Affiliates on the date hereof (other than Equity
interests that do not entitle the holder thereof to vote for the
election of directors of the Company). Such Principal Stockholder
has sole voting power, sole power of disposition and sole power to
issue instructions with respect to the matters set forth in this
Agreement with respect to all of the Covered Shares that are owned
beneficially, by such Principal Stockholder with no limitations,
qualifications or restrictions on such rights, subject to
applicable securities Laws and the terms of this Agreement. Except
as permitted or required by this Agreement, the Covered Shares that
are owned, or that are hereafter acquired, by such Principal
Stockholder (and the certificates representing such shares, if any)
are now, and at all times during the term hereof will be, or, in
the case of Covered Shares acquired after the date hereof, at all
times from the time such Covered Shares are acquired will be, held
by such Principal Stockholder, free and clear of any and all Liens
whatsoever on title, or restrictions on transfer or exercise of any
rights of such Principal Stockholder (other than under applicable
securities Laws, as created by this Agreement or pursuant to any
written policies of the Company with respect to the trading of
securities in connection with xxxxxxx xxxxxxx restrictions,
applicable securities laws and similar
considerations).
(b) Organization
and Qualification. If such
Principal Stockholder is an entity, such Principal Stockholder is
duly formed or organized (as applicable), validly existing and in
good standing under the Laws of the jurisdiction in which it is
formed or organized, as applicable.
(c) Authority.
Such Principal Stockholder has all necessary power and authority
and has taken all action necessary in order to execute and deliver
this Agreement and perform all of such Principal
Stockholder’s obligations under this Agreement and consummate
the transactions contemplated hereby, and no other proceedings or
actions on the part of such Principal Stockholder or, if such
Principal Stockholder is an entity, its board of directors or
managers or other corporate governing body or Person are necessary
to authorize the execution, delivery or performance of this
Agreement or the consummation of the transactions contemplated
hereby.
(d) Due
Execution and Delivery. This
Agreement has been duly executed and delivered by such Principal
Stockholder and, assuming due authorization, execution and delivery
of this Agreement by BCHI, constitutes the valid and binding
obligation of such Principal Stockholder, enforceable against such
Principal Stockholder in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, moratorium,
reorganization or similar laws affecting the rights of creditors
generally and the availability of equitable remedies (regardless of
whether such enforceability is considered in a proceeding in law or
equity).
(e) No
Filings; No Conflict or Default. Neither the execution and delivery of this
Agreement by such Principal Stockholder nor the consummation by
such Principal Stockholder of the transactions contemplated by this
Agreement, nor compliance by such Principal Stockholder with any of
the terms or provisions of this Agreement, will (i) if such
Principal Stockholder is an entity, conflict with or violate any
provision of the organizational documents of such Principal
Stockholder, (ii) assuming that the consents referred to in
Section
3.4 and Section 4.4
of the Merger Agreement are obtained
and the filings referred to in Section 3.4
and Section 4.4
of the Merger Agreement are made, (A)
violate, in any material respect, any Law or Order applicable to
such Principal Stockholder or by which it is bound or affected or
(B) violate or conflict with, or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a
default) under any Contract to which such Principal Stockholder is
a party, or (iii) result in the exercisability of any right to
purchase or acquire the Covered Shares of such Principal
Stockholder.
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(f) No
Litigation. As of the date
hereof, there is no Action pending or, to the knowledge of such
Principal Stockholder, threatened, against or affecting such
Principal Stockholder that would reasonably be expected to impair
the ability of such Principal Stockholder to perform its
obligations hereunder or consummate the transactions contemplated
hereby.
(g) No
Fees. No broker, investment
banker or financial advisor is entitled to any broker’s,
finder’s or financial advisor’s fee or commission, or
the reimbursement of expenses, in connection with the transactions
contemplated hereby based on Contracts made by or on behalf of such
Principal Stockholder.
(h) Receipt
of Merger Agreement; Reliance.
Such Principal Stockholder has received and reviewed a copy of the
Merger Agreement. Such Principal Stockholder understands and
acknowledges that BCHI has entered into the Merger Agreement in
reliance upon such Principal Stockholder’s anticipated
execution, delivery and performance of this
Agreement.
6.
Representations and Warranties of
BCHI. BCHI represents and warrants to the Principal
Stockholders as follows:
(a) Organization
and Qualification. BCHI is a
legal entity duly formed or organized (as applicable), validly
existing and in good standing under the Laws of the jurisdiction in
which it is formed or organized, as applicable.
(b) Authority.
BCHI has all necessary power and authority and has taken all action
necessary in order to execute and deliver this Agreement and
perform all of its respective obligations under this Agreement and
consummate the transactions contemplated hereby, and no other
proceedings or actions on the part of BCHI or its board of
directors are necessary to authorize the execution, delivery or
performance of this Agreement or the consummation of the
transactions contemplated hereby.
(c) Due
Execution and Delivery. This
Agreement has been duly executed and delivered by BCHI and,
assuming due authorization, execution and delivery of this
Agreement by the Principal Stockholders, constitutes a valid and
binding obligation of BCHI, enforceable against BCHI in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, moratorium, reorganization or similar laws affecting the
rights of creditors generally and the availability of equitable
remedies (regardless of whether such enforceability is considered
in a proceeding in law or equity).
(d) No
Filings; No Conflict or Default. Neither the execution and delivery of this
Agreement by BCHI nor the consummation by BCHI of the transactions
contemplated by this Agreement, nor compliance by BCHI with any of
the terms or provisions of this Agreement, will (A) violate, in any
material respect, any Law or Order applicable to BCHI or by which
it is bound or affected or (B) violate or conflict with, or
constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under any Contract to
which BCHI is a party.
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7.
Termination.
The
term (the “Term”) of this Agreement
shall commence on the date hereof and shall terminate upon the
Expiration Date; provided
that (i) nothing herein shall relieve any Party from liability for
any breach of this Agreement prior to its termination and (ii) this
Section 7 and
Section 8 shall
survive any termination of this Agreement.
8.
Miscellaneous.
(a) Entire
Agreement. This Agreement
(together with the Schedule hereto) constitutes the entire
agreement and supersedes all prior agreements and understandings,
both written and oral, among the Parties with respect to the
subject matter of this Agreement.
(b) No
Assignment. Except as
contemplated by Section
2(a), neither this Agreement
nor any of the rights, interests or obligations hereunder will be
assigned by any of the Parties hereto (whether by operation of law
or otherwise) without the prior written consent of the other
Parties and any attempt to do so will be null and void, but no such
assignment will release any assigning Party from its obligations
hereunder. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of and be enforceable by the
Parties hereto and their respective permitted successors and
assigns.
(c) Binding
Successors. Each Principal
Stockholder agrees that this Agreement and the obligations
hereunder shall attach to the Covered Shares beneficially owned by
such Principal Stockholder and shall be binding upon any Person to
which legal or beneficial ownership of such Covered Shares shall
pass, whether by operation of law or otherwise.
(d) Amendments.
Subject to compliance with applicable Law, the Parties may modify
or amend this Agreement only by written agreement executed and
delivered by duly authorized officers of the respective
Parties.
(e) Notices.
All notices and other communications in connection with this
Agreement will be in writing and will be deemed given to a Party
when delivered personally, sent via electronic mail (but only if
followed by an express courier (with confirmation) on the next
Business Day), mailed by registered or certified mail (return
receipt requested) or delivered by an express courier (with
confirmation) at the following addresses, or email addresses (or at
such other address or email address for a Party as will be
specified by like notice):
If to
BCHI, to:
Birch
Communications Holdings, Inc.
c/o
Birch Communications, Inc.
000
Xxxxxxxxxx Xxxxx Xxxx XX
Xxxxxxx, Xxxxxxx
00000
Attention: Xxxxxx
X. Xxxxxxxx, Xx., Senior Vice President and General
Counsel
Email:
xxxxx.xxxxxxxx@xxxxx.xxx
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with a
copy (which will not constitute notice) to:
Xxxxx
Day
0000
Xxxxxxxxx Xxxxxx, X.X.
Xxxxx
000
Xxxxxxx, Xxxxxxx
00000-0000
Attention: Xxxxxxx
X. Xxxxxxx
Email:
xxxxxxxxx@xxxxxxxx.xxx
If to any Principal Stockholder, to the address
set forth below such Principal Stockholder’s name on
Schedule
I hereto.
(f) Severability.
If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction or other authority to
be invalid, void, unenforceable, such term, provision, covenant or
restriction will be deemed to be modified to the extent necessary
to render it valid, effective and enforceable, and the remainder of
the terms, provisions, covenants and restrictions of this Agreement
will remain in full force and effect and will in no way be
affected, impaired or invalidated.
(g) Remedies.
The Parties hereto agree that immediate, extensive and irreparable
damage, for which monetary damages would not be an adequate remedy,
would occur in the event that the Parties hereto do not perform
their obligations under the provisions of this Agreement in
accordance with its specified terms or otherwise breach such
provisions. Accordingly, the Parties acknowledge and agree that the
Parties will be entitled, in addition to any other remedy to which
they are entitled at law or in equity to seek an injunction or
injunctions, specific performance or other equitable relief to
prevent breaches of this Agreement and to enforce specifically the
terms and provisions hereof in the Chosen Courts without proof of
damages or otherwise, and that such explicit rights of specific
enforcement are an integral part of the transactions contemplated
hereby and, without such rights, none of the Principal Stockholders
or BCHI would have entered into this Agreement. Each of the Parties
hereto agrees that it will not oppose the granting of an
injunction, specific performance and other equitable relief on the
basis that the other Parties hereto have an adequate remedy at law
or an award of specific performance is not an appropriate remedy
for any reason at law or in equity.
(h) No
Waiver. Any agreement on the
part of a Party to any such extension or waiver will be valid only
if set forth in a written instrument signed on behalf of such
Party, but such extension or waiver or failure to insist on strict
compliance with an obligation, covenant, agreement or condition
will not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.
(i) No
Third Party Beneficiaries. This
Agreement is not intended to confer on any Person, other than the
Parties hereto and their respective successors and permitted
assigns, any rights or remedies hereunder.
(j) Governing
Law. This Agreement will be
governed and construed in accordance with the internal Laws of the
State of Delaware, without regard to any applicable conflict of
laws principles (whether of the State of Delaware or any other
jurisdiction).
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(k) Submission
to Jurisdiction. Each of the
Parties hereto hereby irrevocably and unconditionally submits, for
itself and its property, to the exclusive jurisdiction and venue of
the Chancery Court of the State of Delaware and, in the absence of
such jurisdiction, the United States District Court for the
District of Delaware, and, in the absence of such federal
jurisdiction, the parties consent to be subject to the exclusive
jurisdiction of any Delaware state court sitting in New Castle
County (together, the “Chosen Courts”),
in any action or proceeding arising out of or relating to this
Agreement or for recognition or enforcement of any judgment
relating thereto, and each of the Parties hereby irrevocably and
unconditionally (i) agrees not to commence any such action or
proceeding except in the Chosen Courts, (ii) agrees that any
claim in respect of any such action or proceeding may be heard and
determined in the Chosen Courts, and any appellate court hearing
actions or proceedings therefrom, (iii) waives, to the fullest
extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any such action
or proceeding in the Chosen Courts, and (iv) waives, to the
fullest extent it may legally and effectively do so, the defense of
an inconvenient forum to the maintenance of such action or
proceeding in the Chosen Courts. Each of the Parties hereto agrees
that a final judgment in any such action or proceeding will be
conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by Law.
Each of the Parties hereto agrees that a final
judgment in any such action or proceeding will be conclusive and
may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by Law.
(l) Waiver
of Jury Trial. EACH PARTY
HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH
WAIVERS, (ii) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF
SUCH WAIVERS, (iii) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (iv) IT
HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
8(l).
(m) Construction.
When a reference is made in this
Agreement to Sections, Exhibits or Schedules, such reference will
be to a Section of or Exhibit or Schedule to this Agreement unless
otherwise indicated. The headings contained in this Agreement are
for reference purposes only and will not affect in any way the
meaning or interpretation of this Agreement. Whenever the words
“include,” “includes” or
“including” are used in this Agreement, they will be
deemed to be followed by the words “without
limitation.” Unless the context otherwise requires,
(i) “or” is disjunctive but not necessarily
exclusive, (ii) words in the singular include the plural and
vice versa, and (iii) the use in this Agreement of a pronoun
in reference to a Party hereto includes the masculine, feminine or
neuter, as the context may require. All the Schedules and Exhibits
to this Agreement will be deemed part of this Agreement and
included in any reference to this Agreement. The Parties have
participated jointly in negotiating and drafting this Agreement. In
the event that an ambiguity or a question of intent or
interpretation arises, this Agreement will be construed as if
drafted jointly by the Parties, and no presumption or burden of
proof will arise favoring or disfavoring any Party by virtue of the
authorship of any provision of this Agreement.
- 10 -
(n) Counterparts.
This Agreement may be executed in two or more counterparts, all of
which will be considered one and the same agreement and will become
effective when counterparts have been signed by each of the Parties
and delivered to the other Party, it being understood that each
Party need not sign the same counterpart.
(o) Expenses.
Except as otherwise provided herein, each Party shall pay such
Party’s own expenses incurred in connection with this
Agreement.
(p) No
Ownership Interest. Nothing
contained in this Agreement shall be deemed, upon execution, to
vest in BCHI any direct or indirect ownership or incidence of
ownership of or with respect to any Covered Shares. All rights,
ownership and economic benefits of and relating to the Covered
Shares shall remain vested in and belong to the Principal
Stockholders, and BCHI shall have no authority to manage, direct,
superintend, restrict, regulate, govern or administer any of the
policies or operations of the Company or exercise any power or
authority to direct the Principal Stockholders in the voting of any
of the Covered Shares, except as otherwise provided herein. This
Agreement is intended to create, and creates, a contractual
relationship and is not intended to create, and does not create,
any agency, partnership, joint venture or any like relationship
between the parties hereto.
(q) Certain
Definitions
. For
the purposes of this Agreement, capitalized terms used and not
otherwise defined herein shall have the respective meanings
ascribed to them in the Merger Agreement. Certain other terms have
the meanings ascribed to them below or elsewhere in this
Agreement.
“Additional Owned Shares”
means all shares of Common Stock that are owned of record and
beneficially by the Principal Stockholders and acquired after the
date hereof.
“Affiliate” has the
meaning set forth in the Merger Agreement; provided, however, that for purposes of this
Agreement, the Company shall not be deemed an Affiliate of any
Principal Stockholder.
“beneficial ownership”
(and related terms such as “beneficially owned” or
“beneficial owner”) has the meaning set forth in Rule
13d-3 under the Exchange Act.
“Covered Shares” means the
Owned Shares and Additional Owned Shares.
“Owned Shares” means all
shares of Common Stock that are owned beneficially by the Principal
Stockholders as of the date hereof.
“Transfer” means, with
respect to a Covered Share, the transfer, pledge, hypothecation,
encumbrance, assignment or other disposition (whether by sale,
merger, consolidation, liquidation, dissolution, dividend,
distribution or otherwise) of such Covered Share or the beneficial
ownership thereof, the offer to make such a transfer or other
disposition, and each Contract, including any option, whether or
not in writing, to effect any of the foregoing. As a verb,
“Transfer” shall have a
correlative meaning.
[Remainder of Page Intentionally Left Blank]
- 11 -
IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed as of the day and year first above written.
BCHI:
BIRCH
COMMUNICATIONS HOLDINGS, INC.
By: /s/
Xxxxxx X.
Xxxxxxxx
Name:
Xxxxxx X. Xxxxxxxx
Title:
Senior Vice President and
General
Counsel
PRINCIPAL
STOCKHOLDERS:
XXXXXX
X. XXXXX
By:
/s/ Xxxxxx X.
Xxxxx
XXXXXXX
X. XXXXX
By:
/s/ Xxxxxxx X.
Xxxxx
XXXXXX
X. XXXXXX
By:
/s/ Xxxxxx X.
Xxxxxx
XXXXXXX
X. DEL XXXXXXX
By:
/s/ Xxxxxxx X. Del
Giudice
XXXX
XXXXX
By: /s/ Xxxx Xxxxx
XXXXX
XXXX
By:
/s/ Xxxxx
Xxxx
XXXX
X’XXXXX
By:
Xxxx
X’Xxxxx
XXXXXXX
XXXXX
By:
/s/ Xxxxxxx
Xxxxx
SCHEDULE I
Principal Stockholders and Common Stock Held
|
Principal Stockholder and Notice Information
|
Shares of Common Stock Beneficially Owned
|
|
Xxxxxx
X. Xxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
1,768,415
|
|
Xxxxxxx
X. Xxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
137,075
|
|
Xxxxxx
X. Xxxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
91,216
|
|
Xxxxxxx
X. Del Giudice
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
64,220
|
|
Xxxx
Xxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
104,448
|
|
Xxxxx
Xxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
49,251
|
|
Xxxx X.
X’Xxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
103,452
|
|
Xxxxxxx
Xxxxx
c/o
Fusion Telecommunications
000
Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx, Xxx Xxxx 00000
|
63,860
|
