SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
OneWave, Inc.
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(Name of Issuer)
Common Stock, par value $.001 per share
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(Title of Class and Securities)
68272R108
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(CUSIP Number of Class of Securities)
Charles Stefanidakis
Cambridge Technology Group
219 Vassar Street
Cambridge, Massachusetts 02139
(617) 876-2338
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
Copy to:
Thomas J. Dougherty, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, Massachusetts 02108
(617) 573-4800
April 22, 1997
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(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the
subject of this Statement because of Rule 13d-1(b)(3) or
(4), check the following: (X)
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Sundar Subramaniam
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
India
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 2,738,437 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
2,738,437 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,738,437 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
18.5%
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(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Legacy Investment Partnership
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 1,306,333 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
1,306,333 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,306,333 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* ( )
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
8.8%
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(14) TYPE OF REPORTING PERSON*
PN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
John J. Donovan, Jr.
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 0 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 1,306,333 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
0 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,306,333 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
261,266.6 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
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(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
James H. Donovan
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 0 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 1,306,333 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
0 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,306,333 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
261,266.6 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
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(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Carolyn S. Donovan
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 0 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 1,306,333 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
0 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,306,333 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
261,266.6 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
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(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Maureen D. Lantz
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 0 shares
BENEFICIALLY ---------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 1,306,333 shares
PERSON ---------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
0 shares
---------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,306,333 shares
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
261,266.6 shares
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
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(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Rebecca M. Donovan
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 0 shares
BENEFICIALLY ---------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 1,306,333 shares
PERSON ---------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
0 shares
---------------------------------------------
(10) SHARED DISPOSITIVE POWER
1,306,333 shares
- ---------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
261,266.6 shares
- ---------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
1.8%
- ---------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
IN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
J&S Limited Partnership
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
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(7) SOLE VOTING POWER
NUMBER OF
SHARES 981,978 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
981,978 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
- ---------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
981,978 shares
- ---------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* ( )
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
6.6%
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(14) TYPE OF REPORTING PERSON*
PN
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Controller Corp., Inc.
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS*
- ---------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
- ---------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
- ---------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES 981,978 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
981,978 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
- ---------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 shares
- ---------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
0%
- ---------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
CO
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
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(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
John J. Donovan, Sr.
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
- ---------------------------------------------------------------------------
(3) SEC USE ONLY
- ---------------------------------------------------------------------------
(4) SOURCE OF FUNDS*
- ---------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
- ---------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
- ---------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES 981,978 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
981,978 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
- ---------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
490,989 shares
- ---------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* (X)
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
3.3%
- ---------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
IN
- ---------------------------------------------------------------------------
* SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 68272R108
- ---------------------------------------------------------------------------
(1) NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Harrington Trust Limited, as Trustee of The Appleby Trust
- ---------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) (X)
(b) ( )
- ---------------------------------------------------------------------------
(3) SEC USE ONLY
- ---------------------------------------------------------------------------
(4) SOURCE OF FUNDS*
- ---------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
- ---------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Bermuda
- ---------------------------------------------------------------------------
(7) SOLE VOTING POWER
NUMBER OF
SHARES 2,722,123 shares
BENEFICIALLY ----------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH
REPORTING 0 shares
PERSON ----------------------------------------------
WITH (9) SOLE DISPOSITIVE POWER
2,722,123 shares
----------------------------------------------
(10) SHARED DISPOSITIVE POWER
0 shares
- ---------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,722,123 shares
- ---------------------------------------------------------------------------
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN
SHARES* ( )
- ---------------------------------------------------------------------------
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
18.4%
- ---------------------------------------------------------------------------
(14) TYPE OF REPORTING PERSON*
OO
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* SEE INSTRUCTIONS BEFORE FILLING OUT!
PRELIMINARY NOTE
This Schedule 13D is filed on behalf of a group within the
meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), consisting of, and amends statements on
Schedule 13G filed on behalf of, Sundar Subramaniam, Legacy Investment
Partnership, J&S Limited Partnership and Harrington Trust Limited, as
Trustee of the Appleby Trust (together, the "Reporting Persons").
Pursuant to the Stock Purchase Agreement (the "Stock Purchase Agreement")
dated as of April 22, 1997 by and among the Reporting Persons and Avix
Ventures, L.P., a Delaware limited partnership ("Avix"), the Reporting
Persons have agreed to sell to Avix an aggregate of 7,748,871 shares (the
"Shares") of common stock, par value $.001 per share (the "Common
Stock"), of OneWave, Inc., a Delaware corporation (the "Company"). A copy
of the Stock Purchase Agreement is filed as Exhibit A hereto.
The Stock Purchase Agreement contemplates that until the closing
of the sale contemplated thereby, and in the event that any matters are
brought before the stockholders of the Company for a vote, either at the
Company's annual meeting of stockholders or otherwise, the Reporting
Persons shall (i) attend or decline to attend such meeting for purposes
of determining the presence of a quorum thereat and (ii) vote the Shares
at such annual meeting or otherwise, in each case as instructed by Avix.
Therefore, as a result of the Stock Purchase Agreement and as set forth
herein, the Reporting Persons and Avix have agreed to take certain
actions which seek to direct or cause the direction of the management of
the Company and may vote their shares of Common Stock, in a manner
consistent with each other. Accordingly, the Reporting Persons and Avix
may be deemed to be acting together for the purpose of acquiring,
holding, voting or disposing of shares of Common Stock, within the
meanings of Section 13(d)(3) of the Exchange Act and Rule 13d-5 under the
Exchange Act. An Agreement to File a Joint Statement on Schedule 13D
among the Reporting Persons that this Schedule 13D be filed on behalf of
each of them is annexed as Exhibit B to this Schedule 13D.
ITEM 1. SECURITY AND ISSUER
Common stock, par value $.001 per share (the "Common Stock"), of
OneWave, Inc. (the "Company"). The Company's principal executive offices
are located at One Arsenal Marketplace, Watertown, MA 02172.
ITEM 2. IDENTITY AND BACKGROUND
(a-c) This Schedule 13D is filed on behalf of Sundar Subramaniam,
Legacy Investment Partnership, a Massachusetts general partnership
("Legacy"), J&S Limited Partnership, a Massachusetts limited partnership
("J&S"), and Harrington Trust Limited, as Trustee of The Appleby Trust, a
Bermuda trust (the "Trust"). The names, addresses, principal
occupations and citizenship or jurisdiction of incorporation, as the case
may be, of Mr. Subramaniam, Legacy, J&S and the Trust and of the partners
of each of Legacy and J&S and the beneficiaries of the Trust are set
forth on Exhibit C hereto.
(d) During the last five years, none of Mr. Subramaniam, Legacy
(nor, to its knowledge, the partners of Legacy), J&S (nor, to its
knowledge, the partners of J&S) or the Trust (nor, to its knowledge, the
beneficiaries of the Trust) has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
(e) During the last five years, none of Mr. Subramaniam, Legacy
(nor, to its knowledge, the partners of Legacy), J&S (nor, to its
knowledge, the partners of J&S) or the Trust (nor, to its knowledge the
beneficiaries of the Trust) has been a party to any civil proceeding of a
judicial or administrative body of competent jurisdiction as a result
of which such person is or was subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating
activities subject to Federal or state securities laws or finding any
violation with respect to such laws.
(f) The citizenship or jurisdiction of incorporation, as the case
may be, of each of the Reporting Persons, including each of the partners
of each of Legacy and J&S and the beneficiaries of the Trust, is set
forth on Exhibit C hereto.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER
CONSIDERATION
Not applicable.
ITEM 4. PURPOSE OF TRANSACTION
The Reporting Persons have made an investment decision to sell
their shares of Common Stock and Avix has made an investment decision to
buy such shares. In this connection, and pending the closing of the sale
contemplated by the Stock Purchase Agreement, Avix desires to be involved
in the management of the Company.
In this connection, on April 24, 1997, Legacy informed the
Company by letter (the "April 24 Letter") of its intent to nominate
pursuant to Section 2 of Article I of the Amended and Restated By-Laws of
the Company (the "By-Laws") and vote, at the next scheduled annual
meeting of stockholders of the Company, for a slate of Class I Directors
of the Company consisting of Mr. Lennart Mengwall, a general partner of
Avix, and Mr. Kevin Azzouz, a general partner of Avix, and to adopt any
amendments to the By-Laws as may be necessary to accomplish such action.
In connection with the intentions set forth in the April 24
Letter and in this Schedule 13D, the Reporting Persons, may contact and
confer periodically with the Company or others, including other
stockholders of the Company, as appropriate, to discuss matters relating
to the Company, including the matters the subject of the April 24 Letter,
or may take any other action which will maximize the value of the Common
Stock for all stockholders.
Except as described above and in Item 6 hereof, the Reporting
Persons have no present plans or proposals which relate to or would
result in any transaction specified in paragraphs (a) through (j) of Item
4 of Schedule 13D. In the future, however, the Reporting Persons reserve
the right to adopt such plans or proposals.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
The group comprised of the Reporting Persons may be deemed to
have beneficial ownership of 7,748,871 shares (constituting 52.3%) of the
outstanding Common Stock. The number and percentage of shares of Common
Stock beneficially owned by each Reporting Person and each other person
for which such disclosure is required, along with the number of shares as
to which each Reporting Person and each other person for which such
disclosure is required has sole or shared power to vote or direct the
vote and sole or shared power to dispose or direct the disposition is set
forth on Schedule I to this Schedule 13D, which is incorporated by
reference herein.
To the knowledge of the Reporting Persons, no person other than
each of the Reporting Persons has the right to receive or the power to
direct the receipt of dividends from, or the proceeds of the sale of, the
Common Stock owned by each of the respective Reporting Persons, except as
otherwise set forth herein.
The beneficiaries of the Trust (who exercise no voting or
investment power over the shares of Common Stock held by Harrington Trust
Limited, as Trustee of the Trust) are John J. Donovan, Jr., James H.
Donovan, Carolyn S. Donovan, Maureen D. Lantz and Rebecca M. Donovan.
On April 28, 1997, Sundar Subramaniam transferred 3,700 shares of
Common Stock as a gift. On April 28, 1997, Legacy transferred 27,000
shares as a gift.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO SECURITIES OF
THE ISSUER.
Reference is made to the Preliminary Note set forth on page 2 of
this Schedule 13D and to the information set forth in response to Item 4
and Item 5 of this Schedule 13D for information relating to the existence
of certain contracts, arrangements, understandings or relationships among
the Reporting Persons, which information is incorporated by reference
herein.
Pursuant to the Stock Purchase Agreement, the Reporting Persons
have agreed, subject to certain conditions to closing, to sell 7,748,871
shares of Common Stock to Avix. Until the closing of such sale, Mr.
Subramaniam, Legacy, J&S and the Trust have each agreed to vote the
shares of Common Stock he or it owns in accordance with the instructions
of Avix and to cooperate with Avix with respect to similar matters
relating to the record ownership of such Common Stock. The nominations
for election to the Board of Directors of the Company set forth in the
April 24 Letter were made in furtherance of such obligation.
John J. Donovan, Jr., James H. Donovan, Carolyn S. Donovan,
Maureen D. Lantz and Rebecca M. Donovan, the general partners of Legacy
(together, the "General Partners"), (i) are siblings and (ii) are
beneficiaries of the Trust, the trustee of which is Harrington Trust
Limited, which owns 2,722,123 shares of Common Stock. The General
Partners do not have beneficial ownership of any shares of Common Stock
held by the Trust within the meaning of Rule 13d-3 under the Exchange
Act. Of the shares of Common Stock held by the Trust, 1,600,000 shares
have been pledged by Harrington Trust Limited, as trustee, to Cambridge
Samsung Partners LLC ("CSP") as a guarantee of the satisfaction of
certain obligations. In addition, Sundar Subramaniam has pledged
1,600,000 shares of Common Stock to CSP as a guarantee of the
satisfaction of certain obligations. As of the date hereof, CSP has the
right to ownership of all such shares of Common Stock pledged to CSP by
the Trust and Mr. Subramaniam. Each of Harrington Trust Limited, as
trustee, and Sundar Subramaniam have pledged 45,500 shares to Private
Equity Holdings, L.P. and Permal Private Equity Holdings, L.P. as
guarantees of the satisfaction of certain obligations. J&S has pledged
981,978 shares of Common Stock to State Street Bank and Trust Company
("State Street") as a guarantee of the satisfaction of certain
obligations. As of the date hereof, State Street has the right to
ownership of any shares of Common Stock pledged to State Street.
Other than as set forth above, there are no contracts,
arrangements, understandings or relationships among the persons named in
Item 2 hereof and between such persons and any other person with respect
to any securities of the Company.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
1. Stock Purchase Agreement.
2. Joint Filing Agreement of the Reporting Persons.
SIGNATURE
After reasonable inquiry and to the best knowledge and belief
of the undersigned, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
May 2, 1997 /s/ Sundar Subramaniam
- ----------------------- --------------------------------------
Date Sundar Subramaniam
SIGNATURE
After reasonable inquiry and to the best knowledge and belief of
the undersigned, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
LEGACY INVESTMENT PARTNERSHIP
May 2, 1997 By:/s/ John J. Donovan, Jr.
- ----------------------- --------------------------------------
Date John J. Donovan, Jr.
Managing Partner
May 2, 1997 By:/s/ James H. Donovan
- ----------------------- --------------------------------------
Date James H. Donovan
May 2, 1997 By:/s/ Carolyn S. Donovan
- ----------------------- --------------------------------------
Date Carolyn S. Donovan
May 2, 1997 By:/s/ Maureen D. Lantz
- ----------------------- --------------------------------------
Date Maureen D. Lantz
May 2, 1997 By:/s/ Rebecca M. Donovan
- ----------------------- --------------------------------------
Date Rebecca M. Donovan
SIGNATURE
After reasonable inquiry and to the best knowledge and belief of
the undersigned, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
J&S LIMITED PARTNERSHIP
By: CONTROLLER CORP., INC.
General Partner
May 2, 1997 By:/s/ John J. Donovan, Sr.
- ----------------------- --------------------------------------
Date John J. Donovan, Sr.
President
SIGNATURE
After reasonable inquiry and to the best knowledge and belief of
the undersigned, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
HARRINGTON TRUST LIMITED, as Trust-
ee of The APPLEBY TRUST
May 2, 1997 By:/s/ Martin Phillipps
- ----------------------- --------------------------------------
Date Martin Phillipps
Managing Director
EXHIBIT A
STOCK PURCHASE AGREEMENT
AMONG
AVIX VENTURES, L.P. ("PURCHASER")
AND
APPLEBY TRUST, BY
HARRINGTON TRUST LIMITED, AS TRUSTEE,
J&S LIMITED PARTNERSHIP,
LEGACY INVESTMENT PARTNERSHIP,
SUNDAR SUBRAMANIAM (THE "SELLERS")
DATED AS OF APRIL 22, 1997
TABLE OF CONTENTS
Page
1. Sale and Purchase of Shares.................................... 1
1.1 Sale and Purchase of Shares.......................... 1
2. Purchase Price and Payment..................................... 1
2.1 Purchase Price and Payment........................... 1
2.2 Contingent Purchase Price............................ 2
2.3 Arbitrator's Adjustment.............................. 2
3. Closing and Termination........................................ 3
3.1 Closing Date......................................... 3
3.2 Termination of Agreement............................. 3
3.3 Procedure Upon Termination........................... 4
3.4 Effect of Termination................................ 4
4. Representations and Warranties of the Sellers.................. 4
4.1 Organization and Good Standing....................... 5
4.2 Authorization of Agreement........................... 5
4.3 Conflicts; Consents of Third Parties................. 5
4.4 Ownership and Transfer of Shares..................... 6
4.5 Related Party Transactions........................... 6
4.6 No Misrepresentation................................. 6
4.7 Litigation........................................... 7
4.8 Financial Advisors................................... 7
5. Representations and Warranties of Purchaser.................... 7
5.1 Organization and Good Standing....................... 7
5.2 Authorization of Agreement........................... 7
5.3 Conflicts; Consents of Third Parties................. 8
5.4 Litigation........................................... 8
5.5 Financial Advisors................................... 8
5.6 Investment Experience, Investment
Intent, Etc.......................................... 8
6. Covenants...................................................... 9
6.1 Consents............................................. 9
6.2 Other Actions........................................ 10
6.3 No Solicitation...................................... 10
6.4 Publicity............................................ 10
6.5 Repayment of Loans................................... 11
6.6 Irrevocable Proxy.................................... 11
7. Conditions to Closing.......................................... 11
7.1 Conditions Precedent to Obligations of
Purchaser.......................................... 11
7.2 Conditions Precedent to Obligations of
the Sellers........................................ 12
8. Documents to be Delivered...................................... 13
8.1 Documents to be Delivered by the Sellers............. 13
8.2 Documents to be Delivered by Purchaser............... 13
9. Miscellaneous.................................................. 14
9.1 Certain Definitions.................................. 14
9.2 Payment of Sales, Use or Similar Taxes............... 16
9.3 Survival of Representations and
Warranties......................................... 16
9.4 Costs and Expenses................................... 16
9.5 Specific Performance................................. 16
9.6 Further Assurances................................... 16
9.7 Entire Agreement; Amendments and Waivers............. 17
9.8 Governing Law........................................ 17
9.9 Table of Contents and Headings....................... 17
9.10 Notices.............................................. 17
9.11 Severability......................................... 18
9.12 Binding Effect; Assignment........................... 18
9.13 Sellers' Representative.............................. 19
9.14 Counterparts......................................... 19
ANNEXES
ANNEX A Schedule of Sellers and Purchase Price
for Shares
EXHIBITS
EXHIBIT A Form of Non-Recourse Promissory Note
EXHIBIT B Form of Pledge Agreement
SCHEDULES
Schedule 4.4 Liens
Schedule 4.5 Related Party Transactions
Schedule 4.8 Financial Advisors
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (the "Agreement") is made as of the
22nd day of April, 1997, by and among Avix Ventures, L.P. ("Purchaser")
and Appleby Trust, by Harrington Trust Limited, as trustee, J&S Limited
Partnership, Legacy Investment Partnership and Sundar Subramaniam (the
"Sellers").
W I T N E S S E T H:
WHEREAS, the Sellers own an aggregate of 7,748,871 shares of
common stock, $.001 par value per share (the "Shares") of OneWave, Inc.,
a Delaware corporation (the "Company"); and
WHEREAS, the Sellers desire to sell to Purchaser, and Purchaser
desires to purchase from the Sellers, the Shares for the purchase price
and upon the terms and conditions hereinafter set forth; and
WHEREAS, certain terms used in this Agreement are defined in
Section 9.1;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter contained, the parties hereby agree
as follows:
ARTICLE I
SALE AND PURCHASE OF SHARES
1.1 Sale and Purchase of Shares. Upon the terms and subject to
the conditions contained herein, on the Closing Date, each Seller shall
sell, assign, transfer, convey and deliver to Purchaser, and Purchaser
shall purchase from each Seller, the Shares of such Seller set forth
opposite such Seller's name on Annex A hereto.
ARTICLE II
PURCHASE PRICE AND PAYMENT
2.1 Purchase Price and Payment. The purchase price for the
Shares shall be an aggregate amount equal to $8,000,000 (the "Purchase
Price"), subject to adjustment as provided in Section 2.3 below. The
Purchase Price shall be paid as follows: (i) $3,000,000 in cash to be
paid at the Closing in the form of a wire transfer, (ii) $3,000,000 to be
paid in the form of a Non-Recourse Promissory Note due six months from
the Closing Date substantially in the form of Exhibit A hereto and (iii)
$2,000,000 to be paid in the form of a Non-Recourse Promissory Note,
substantially in the form of Exhibit A hereto except that such note shall
be due 36 months from the Closing Date (subject to a reduction in the
maturity date as provided in Section 2.3 below). The Non-Recourse
Promissory Notes will be secured by a Pledge Agreement, substantially in
the form of Exhibit B hereto. The cash purchase price to be paid to each
Seller shall be equal to the total purchase price multiplied by the
percentage interest owned by each respective Seller (the "Seller's
Percentage Interest"), as set forth opposite each Seller's name on Annex
A hereto; the Non-Recourse Promissory Notes will be paid to John J.
Donovan, Jr., as agent for the Sellers.
2.2 Contingent Purchase Price. In the event that Purchaser
sells any of the Shares being purchased hereunder, the Sellers shall be
entitled to receive an additional payment, to be paid within ten (10)
days after such sale, equal in the aggregate to (i) 15% of the proceeds,
net of commissions and selling costs (the "net proceeds"), received by
Purchaser in such sale in excess of $5 per share and (ii) an additional
5% of the net proceeds received by Purchaser in such sale in excess of
$10 per share. In each case, (i) the Purchaser shall pay the additional
payment to the Sellers either in cash or in property, depending on the
type of consideration received by the Purchaser at the time such shares
are sold, (ii) each individual Seller shall receive an amount equal to
the total amount of the additional payment multiplied by such Seller's
Percentage Interest, unless the Sellers and Purchaser mutually agree
otherwise and (iii) the per share prices in the preceding sentence shall
be adjusted in the event of that the Company declares and effectuates a
stock dividend, stock split, reverse stock split or recapitalization. All
certificates for Shares registered in the name of the Purchaser or its
nominee shall bear an appropriate legend making reference to the Sellers'
rights under this Section 2.2.
2.3 Arbitrator's Adjustment. On the date which is 17 months
after the Closing Date, each of Purchaser and the Sellers shall submit to
James G. Nondorf or, in the event Mr. Nondorf is unable or unwilling to
serve, to a successor arbitrator designated by Mr. Nondorf if he is able
to do so or jointly by Purchaser and the Sellers if he is unable to do so
(in either case, the "Arbitrator") such information as it or they deem
relevant to an evaluation of the economic and other benefits to the
Purchaser of its ownership of the Shares. In his sole discretion, based
on the information submitted to him by Purchaser and the Sellers and on
such other information, if any, as the Arbitrator deems relevant, the
Arbitrator, by written notice to Purchaser and the Sellers, may, but is
under no obligation to, (i) shorten, to a date not earlier than a date 18
months following the Closing Date, the due date of the $2,000,000
Non-Recourse Promissory Note referred to in Section 2.1(iii) above and/or
(ii) increase the amount of contingent consideration payable pursuant to
Section 2.2 above by an amount equal to up to 10% of the net proceeds
received by the Purchaser in any sale of the Shares for a price in excess
of $2.00 per share but less than or equal to $5.50 per share, which
additional contingent consideration shall be payable when and as the
contingent consideration payable pursuant to Section 2.2 shall be
payable. The Arbitrator shall be free to exercise his independent
discretion in determining whether any adjustment pursuant to this Section
2.3 shall be appropriate. The determination of the Arbitrator hereunder
shall be final and non-appealable and shall be binding upon Purchaser and
the Sellers.
ARTICLE III
CLOSING AND TERMINATION
3.1 Closing Date. Subject to the satisfaction of the conditions
set forth in Sections 7.1 and 7.2 hereof (or the waiver thereof by the
party entitled to waive that condition), the closing of the sale and
purchase of the Shares provided for in Section 1(A) hereof (the
"Closing") shall take place at the offices of Brobeck, Phleger &
Harrison, New York, New York, at 10:00 a.m., on May 15, 1997, or at such
other time and place as Purchaser and the Sellers shall mutually agree.
The date on which the Closing shall be held is referred to in this
Agreement as the "Closing Date". At the Closing, each Seller shall
deliver to Purchaser a certificate or certificates representing the
Shares that Purchaser is purchasing from such Seller, against payment of
the purchase price therefor by check, wire transfer, or such other form
of payment as shall be mutually agreed upon by Purchaser and such Seller.
3.2 Termination of Agreement. This Agreement may be terminated
prior to the Closing as follows:
(a) At the election of Purchaser on or after June 15, 1997, if
the Closing shall not have occurred by the close of business on such
date, provided that Purchaser is not in default of any of its obligations
hereunder;
(b) by mutual written consent of the Sellers' Representative
and Purchaser; or
(c) by the Sellers' Representative or Purchaser if there shall
be in effect a final nonappealable Order of a Governmental Body of
competent jurisdiction restraining, enjoining or otherwise prohibiting
the consummation of the transactions contemplated hereby; it being agreed
that the parties hereto shall promptly appeal any adverse determination
which is not nonappealable (and pursue such appeal with reasonable
diligence).
3.3 Procedure Upon Termination. In the event of termination and
abandonment by Purchaser or the Sellers, or both, pursuant to Section 3.2
hereof, written notice thereof shall forthwith be given to the other
party or parties, and this Agreement shall terminate, and the purchase of
the Shares hereunder shall be abandoned, without further action by
Purchaser or the Sellers. If this Agreement is terminated as provided
herein each party shall redeliver all documents, work papers and other
material of any other party relating to the transactions contemplated
hereby, whether so obtained before or after the execution hereof, to the
party furnishing the same.
3.4 Effect of Termination. In the event that this Agreement is
validly terminated as provided herein, then each of the parties shall be
relieved of their duties and obligations arising under this Agreement
after the date of such termination and such termination shall be without
liability to Purchaser or any Seller; provided, however, that the
obligations of the parties set forth in Section 9.4 hereof shall survive
any such termination and shall be enforceable hereunder; provided,
further, however, that nothing in this Section 3.4 shall relieve
Purchaser or any Seller of any liability for a breach of this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers hereby, jointly and not severally, represent and
warrant to Purchaser that:
4.1 Organization and Good Standing.
If such Seller is a corporate entity, it is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation. If such Seller is a partnership, it is
a partnership duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization. If such Seller is a
trust, it is a trust duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization.
4.2 Authorization of Agreement. Such Seller has all requisite
power, authority and legal capacity to execute and deliver this Agreement
and each other agreement, document, or instrument or certificate
contemplated by this Agreement or to be executed by such Seller in
connection with the consummation of the transactions contemplated by this
Agreement (together with this Agreement, the "Seller Documents"), and to
consummate the transactions contemplated hereby and thereby. This
Agreement has been, and each of the Seller Documents will be at or prior
to the Closing, duly and validly executed and delivered by such Seller
and (assuming the due authorization, execution and delivery by the other
parties hereto and thereto) this Agreement constitutes, and each of the
Seller Documents when so executed and delivered will constitute, legal,
valid and binding obligations of such Seller, enforceable against such
Seller in accordance with their respective terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally, and subject, as to
enforceability, to general principles of equity, including principles
of commercial reasonableness, good faith and fair dealing (regardless of
whether enforcement is sought in a proceeding at law or in equity).
4.3 Conflicts; Consents of Third Parties. (a) None of the
execution and delivery by such Seller of this Agreement and the Seller
Documents, the consummation of the transactions contemplated hereby or
thereby, or compliance by such Seller with any of the provisions hereof
or thereof will (i) conflict with, or result in the breach of, any
provision of the certificate of incorporation or by-laws or comparable
organizational documents of such Seller; (ii) conflict with, violate,
result in the breach or termination of, or constitute a default under any
note, bond, mortgage, indenture, license, agreement or other instrument
or obligation to which such Seller is a party or by which it or any of
its properties or assets is bound; (iii) violate any statute, rule,
regulation, order or decree of any governmental body or authority by
which such Seller is bound; or (iv) result in the creation of any Lien
upon the properties or assets of such Seller except, in case of clauses
(ii), (iii) and (iv), for such violations, breaches or defaults as would
not, individually or in the aggregate, have a Material Adverse Effect.
(b) No consent, waiver, approval, Order, Permit or
authorization of, or declaration or filing with, or notification to, any
Person or Governmental Body is required on the part of such Seller or the
Company in connection with the execution and delivery of this Agreement
or the Seller Documents, or the compliance by such Seller or the Company
as the case may be, with any of the provisions hereof or thereof.
4.4 Ownership and Transfer of Shares. Such Seller is the record
and beneficial owner of the Shares indicated as being owned by such
Seller on Annex A hereto, free and clear of any and all Liens, except for
Liens described on Schedule 4.4 hereof, which Liens shall be discharged
prior to Closing and evidence of such discharge shall be provided to the
Purchaser. Such Seller has the power and authority to sell, transfer,
assign and deliver such Shares as provided in this Agreement, and such
delivery will convey to Purchaser good and marketable title to such
Shares, free and clear of any and all Liens.
4.5 Related Party Transactions. Except as set forth on Schedule
4.5 hereto, neither such Seller nor any of its Affiliates has borrowed
any moneys from or has outstanding any indebtedness or other similar
obligations to the Company. Except as set forth in Schedule 4.5 hereto,
neither such Seller, any Affiliate of such Seller nor any officer or
employee of any of them (i) owns any direct or indirect interest of any
kind in, or controls or is a director, officer, employee or partner of,
or consultant to, or lender to or borrower from or has the right to
participate in the profits of, any Person which is (A) a competitor,
supplier, customer, landlord, tenant, creditor or debtor of the Company,
(B) engaged in a business related to the business of the Company or (C) a
participant in any transaction to which the Company is a party or (ii) is
a party to any Contract with the Company.
4.6 No Misrepresentation. No representation or warranty of such
Seller contained in this Agreement or in any schedule hereto or in any
certificate or other instrument furnished by such Seller to Purchaser
pursuant to the terms hereof, contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements
contained herein or therein not misleading.
4.7 Litigation. There are no Legal Proceedings pending or, to
the best knowledge of such Seller, threatened that are reasonably likely
to prohibit or restrain the ability of such Seller to enter into this
Agreement or consummate the transactions contemplated hereby.
4.8 Financial Advisors. Except as set forth on Schedule 4.8
hereof, no Person has acted, directly or indirectly, as a broker, finder
or financial advisor for such Seller, or to the best of such Seller's
knowledge, any of the other Sellers, in connection with the transactions
contemplated by this Agreement and no Person is entitled to any fee or
commission or like payment in respect thereof.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to the Sellers that:
5.1 Organization and Good Standing. Purchaser is a limited
partnership duly organized, validly existing and in good standing under
the laws of the State of Delaware.
5.2 Authorization of Agreement. Purchaser has full partnership
power and authority to execute and deliver this Agreement, the
Non-Recourse Promissory Notes, the Pledge Agreement and each other
agreement, document, instrument or certificate contemplated by this
Agreement or to be executed by Purchaser in connection with the
consummation of the transactions contemplated hereby and thereby (the
"Purchaser Documents"), and to consummate the transactions contemplated
hereby and thereby. The execution, delivery and performance by Purchaser
of this Agreement and each Purchaser Document have been duly authorized
by all necessary partnership action on behalf of Purchaser. This
Agreement has been, and each Purchaser Document will be at or prior to
the Closing, duly executed and delivered by Purchaser and (assuming the
due authorization, execution and delivery by the other parties hereto and
thereto) this Agreement constitutes, and each Purchaser Document when so
executed and delivered will constitute, legal, valid and binding
obligations of Purchaser, enforceable against Purchaser in accordance
with their respective terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to
enforceability, to general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of
whether enforcement is sought in a proceeding at law or in equity).
5.3 Conflicts; Consents of Third Parties.
(a) Neither the execution and delivery by Purchaser of this
Agreement and of the Purchaser Documents, nor the compliance by Purchaser
with any of the provisions hereof or thereof will (i) conflict with, or
result in the breach of, any provision of the partnership agreement of
Purchaser, (ii) conflict with, violate, result in the breach of, or
constitute a default under any note, bond, mortgage, indenture, license,
agreement or other obligation to which Purchaser is a party or by which
Purchaser or its properties or assets are bound or (iii) violate any
statute, rule, regulation, order or decree of any governmental body or
authority by which Purchaser is bound, except, in the case of clauses
(ii) and (iii), for such violations, breaches or defaults as would not,
individually or in the aggregate, have a material adverse effect on the
business, properties, results of operations, prospects, conditions
(financial or otherwise) of Purchaser.
(b) No consent, waiver, approval, Order, Permit or
authorization of, or declaration or filing with, or notification to, any
Person or Governmental Body is required on the part of Purchaser in
connection with the execution and delivery of this Agreement or the
Purchaser Documents or the compliance by Purchaser with any of the
provisions hereof or thereof.
5.4 Litigation. There are no Legal Proceedings pending or, to
the best knowledge of Purchaser, threatened that are reasonably likely to
prohibit or restrain the ability of Purchaser to enter into this
Agreement or consummate the transactions contemplated hereby.
5.5 Financial Advisors. No Person has acted, directly or
indirectly, as a broker, finder or financial advisor for Purchaser in
connection with the transactions contemplated by this Agreement and no person
is entitled to any fee or commission or like payment in respect thereof.
5.6 Investment Experience, Investment Intent, Etc.
(a) Purchaser acknowledges that, in making the decision to
purchase the Shares, it has relied solely upon independent investigations
made by it and not upon any representations made by the Sellers with
respect to the Company or the Shares, except for the representations and
warranties of the Sellers contained in this Agreement.
(b) Purchaser understands that the Shares are being offered and
sold to it in reliance on specific exemptions from the registration
requirements of the Federal and state securities laws and that the
Sellers are relying, in part, upon the truth and accuracy of the
representations, warranties, agreements, acknowledgements and
understandings of Purchaser set forth herein in order to determine the
applicability of such exemptions and the suitability of Purchaser to
acquire the Shares.
(c) Purchaser is aware that the Shares have not been registered
under the Securities Act of 1933, as amended (the "Securities Act"), and
may only be offered or sold pursuant to registration under the Securities
Act or an available exemption or exclusion therefrom.
(d) Purchaser is an "accredited investor" within the meaning of
Rule 501 of Regulation D under the Securities Act.
(e) Purchaser has sufficient knowledge and experience in
investing in companies similar to the Company so as to be able to
evaluate the risks and merits of its investment in the Company and
Purchaser is able to bear the financial risks thereof.
(f) Purchaser is acquiring the Shares for its own account for
the purpose of investment and not with a view to or for sale in
connection with any distribution thereof.
(g) The purchase of the Shares is consistent with the general
investment objectives of Purchaser.
(h) Purchaser acknowledges that certain of the foregoing
representations and warranties can, and will, be relied upon by the
Company and any transfer agent of the Company in connection with the
transfer of the Shares from the Sellers to Purchaser.
ARTICLE VI
COVENANTS
6.1 Consents. The Sellers shall use their best efforts, and
Purchaser shall cooperate with the Sellers to obtain at the earliest
practicable date any and all consents and approvals required to
consummate the transactions contemplated by this Agreement; provided,
however, that neither the Sellers nor Purchaser shall be obligated to pay
any consideration therefor to any third party from whom consent or
approval is requested.
6.2 Other Actions. Each of the Sellers and Purchaser shall use
its best efforts to (i) take all actions necessary or appropriate to
consummate the transactions contemplated by this Agreement and (ii) cause
the fulfillment at the earliest practicable date of all of the conditions
to their respective obligations to consummate the transactions
contemplated by this Agreement.
6.3 No Solicitation. Until the Closing Date, the Sellers will
not, and will use its best efforts to prevent the Company or any of the
Company's directors, officers, employees, representatives or agents
(collectively, the "Representatives") from, directly or indirectly, (i)
discussing, negotiating, undertaking, authorizing, recommending,
proposing or entering into, either as the proposed surviving, merged,
acquiring or acquired corporation, any transaction involving a merger,
consolidation, business combination, purchase or disposition of any
amount of the assets or capital stock or other equity interest in the
Company other than the transactions contemplated by this Agreement (an
"Acquisition Transaction"), (ii) facilitating, encouraging, soliciting or
initiating discussions, negotiations or submissions of proposals or
offers in respect of an Acquisition Transaction, (iii) furnishing or
causing to be furnished, to any Person, any information concerning the
business, operations, properties or assets of the Company in connection
with an Acquisition Transaction, or (iv) otherwise cooperating in any way
with, or assisting or participating in, facilitating or encouraging, any
effort or attempt by any other Person to do or seek any of the foregoing.
The Sellers will inform Purchaser in writing immediately following the
receipt by any Seller, the Company or any Representative of any proposal
or inquiry in respect of any Acquisition Transaction.
6.4 Publicity. None of the Sellers nor Purchaser shall issue
any press release or public announcement concerning this Agreement or the
transactions contemplated hereby without obtaining the prior written
approval of the other party hereto, which approval will not be
unreasonably withheld or delayed, unless, in the sole judgment of
Purchaser, disclosure is otherwise required by applicable Law or by the
applicable rules of any stock exchange, provided that, to the extent
required by applicable law, the party intending to make such release
shall use its best efforts consistent with such applicable law to consult
with the other party with respect to the text thereof.
6.5 Repayment of Loans. On or prior to the Closing Date, any
and all loans or other advances to the Sellers or any of their
Affiliates, including any accrued and unpaid interest thereon, shall be
repaid in full to the Company.
6.6 Irrevocable Proxy. In the event that, at any time after
this Agreement has been executed and the Sellers are still the owners of
record of the Shares, any matters are brought before the stockholders of
the Company for a vote, either at the Company's Annual Meeting of
Stockholders or otherwise, the Sellers hereby irrevocably agree to (i)
attend or decline to attend such meeting for purposes of determining the
presence of a quorum thereat and (ii) vote the Shares at such Annual
Meeting or otherwise, in each case as instructed by Purchaser. In
connection therewith, the Sellers shall consult with Purchaser to receive
voting instructions for each and every matter brought before the
stockholders for a vote during such period, and will not under any
circumstances attend such a meeting or vote the Shares other than in
accordance with such instructions. The Sellers also hereby agree to
cooperate with Purchaser in a similar fashion relating to any other
similar matters relating to the record ownership of the Shares.
ARTICLE VII
CONDITIONS TO CLOSING
7.1 Conditions Precedent to Obligations of Purchaser. The
obligation of Purchaser to consummate the transactions contemplated by
this Agreement is subject to the fulfillment, on or prior to the Closing
Date, of each of the following conditions (any or all of which may be
waived by Purchaser in whole or in part to the extent permitted by
applicable law):
(a) all representations and warranties of the Sellers contained
herein shall be true and correct as of the date hereof;
(b) all representations and warranties of the Sellers contained
herein shall be true and correct, at and as of the Closing Date with the
same effect as though those representations and warranties had been made
again at and as of that time;
(c) the Sellers shall have performed and complied in all
material respects with all obligations and covenants required by this
Agreement to be performed or complied with by them on or prior to the
Closing Date;
(d) Purchaser shall have been furnished with certificates
(dated the Closing Date and in form and substance reasonably satisfactory
to Purchaser) executed by each Seller certifying as to the fulfillment of
the conditions specified in Sections 7.1(a), 7.1(b) and 7.1(c) hereof;
(e) Certificates representing all of the Shares shall have
been, or shall at the Closing be, validly delivered and transferred to
Purchaser, free and clear of any and all Liens, accompanied by stock
powers duly endorsed in form sufficient to permit immediate transfer of
the Shares to Purchaser;
(f) Purchaser shall have obtained all consents and waivers
referred to in Section 5.3 hereof with respect to the transactions
contemplated by this Agreement and the Purchaser Documents;
(g) the Sellers shall have obtained all consents and waivers
referred to in Section 4.5 hereof, in a form reasonably satisfactory to
Purchaser, with respect to the transactions contemplated by this
Agreement and the Seller Documents;
(h) no Legal Proceedings shall have been instituted or
threatened or claim or demand made against the Sellers, the Company, or
Purchaser seeking to restrain or prohibit or to obtain substantial
damages with respect to the consummation of the transactions contemplated
hereby, and there shall not be in effect any Order by a Governmental Body
of competent jurisdiction restraining, enjoining or otherwise prohibiting
the consummation of the transactions contemplated hereby; and
(i) all Affiliate Loans shall have been repaid to the Company
prior to the Closing Date.
7.2 Conditions Precedent to Obligations of the Sellers. The
obligations of the Sellers to consummate the transactions contemplated by
this Agreement are subject to the fulfillment, prior to or on the Closing
Date, of each of the following conditions (any or all of which may be
waived by the Sellers in whole or in part to the extent permitted by
applicable law):
(a) all representations and warranties of Purchaser contained
herein shall be true and correct as of the date hereof;
(b) all representations and warranties of Purchaser contained
herein shall be true and correct in all material respects, at and as of
the Closing Date, with the same effect as though those representations
and warranties had been made again at and as of that date;
(c) Purchaser shall have performed and complied in all material
respects with all obligations and covenants required by this Agreement to
be performed or complied with by Purchaser on or prior to the Closing
Date;
(d) the Sellers shall have been furnished with certificates
(dated the Closing Date and in form and substance reasonably satisfactory
to the Sellers) executed by Purchaser certifying as to the fulfillment of
the conditions specified in Sections 7.2(a), 7.2(b) and 7.2(c) hereof;
(e) there shall not be in effect any Order by a Governmental
Body of competent jurisdiction restraining, enjoining or otherwise
prohibiting the consummation of the transactions contemplated hereby.
ARTICLE VIII
DOCUMENTS TO BE DELIVERED
8.1 Documents to be Delivered by the Sellers. At the Closing,
the Sellers shall deliver, or cause to be delivered, to Purchaser the
following:
(a) stock certificates representing the Shares, duly endorsed
in blank or accompanied by stock transfer powers and with all requisite
stock transfer tax stamps attached;
(b) copies of all consents and waivers referred to in Section
7.1(f) hereof;
(c) written evidence of the repayment to the Company of all
Affiliate Loans; and
(d) such other documents as Purchaser shall reasonably request.
8.2 Documents to be Delivered by Purchaser. At the Closing,
Purchaser shall deliver to the Sellers the following:
(a) evidence of the wire transfers referred to in Section 2
hereof;
(b) the Non-Recourse Promissory Notes;
(c) the Pledge Agreement, with stock powers sufficient to
permit transfer of the Shares pursuant to the provisions of such Pledge
Agreement; and
(d) such other documents as the Sellers shall reasonably
request.
ARTICLE IX
MISCELLANEOUS
9.1 Certain Definitions.
For purposes of this Agreement, the following terms shall have
the meanings specified in this Section 9.1:
"Affiliate" means, with respect to any Person, any other Person
controlling, controlled by or under common control with such Person.
"Closing" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"Closing Date" shall have the meaning ascribed to such term in
Section 3.1 hereof.
"Contract" means any Contract, agreement, indenture, note,
bond, loan, instrument, lease, commitment or other arrangement or
agreement.
"Governmental Body" means any government or governmental or
regulatory body thereof, or political subdivision thereof, whether
federal, state, local or foreign, or any agency, instrumentality or
authority thereof, or any court or arbitrator (public or private).
"Law" means any federal, state, local or foreign law (including
common law), statute, code, ordinance, rule, regulation or other
requirement.
"Legal Proceeding" means any judicial, administrative or
arbitral actions, suits, proceedings (public or private), claims or
governmental proceedings.
"Lien" means any lien, pledge, mortgage, deed of trust,
security interest, claim, lease, charge, option, right of first refusal,
easement, servitude, transfer restriction under any shareholder or
similar agreement, encumbrance or any other restriction or limitation
whatsoever.
"Material Adverse Change" means any material adverse change in
the business, properties, results of operations, prospects, condition
(financial or otherwise) of the Company.
"Material Adverse Effect" means any effect which has resulted
in, or is reasonably likely to result in, a Material Adverse Change.
"Order" means any order, injunction, judgment, decree, ruling,
writ, assessment or arbitration award.
"Permits" means any approvals, authorizations, consents,
licenses, permits or certificates.
"Person" means any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, unincorporated
organization, Governmental Body or other entity.
"Purchaser Documents" shall have the meaning ascribed to such
term in Section 5.2 hereof.
"Purchase Price" shall have the meaning ascribed to such term
in Section 2.1 hereof.
"Seller Documents" shall have the meaning ascribed to such term
in Section 4.2 hereof.
"Sellers' Representative" shall have the meaning ascribed to
such term in Section 9.13 hereof.
"Shares" shall have the meaning ascribed to such term in the
first recital of this Agreement.
"Taxes" means (i) all federal, state, local or foreign taxes,
charges, fees, imposts, levies or other assessments, including, without
limitation, all net income, gross receipts, capital, sales, use, ad
valorem, value added, transfer, franchise, profits, inventory, capital
stock, license, withholding, payroll, employment, social security,
unemployment, excise, severance, stamp, occupation, property and
estimated taxes, customs duties, fees, assessments and charges of any
kind whatsoever, (ii) all interest, penalties, fines, additions to tax or
additional amounts imposed by any taxing authority in connection with any
item described in clause (i) and (iii) any transferee liability in
respect of any items described in clauses (i) and/or (ii).
9.2 Payment of Sales, Use or Similar Taxes. All sales, use,
transfer, intangible, recordation, documentary stamp or similar Taxes or
charges, of any nature whatsoever, applicable to, or resulting from, the
transactions contemplated by this Agreement shall be borne by the
Sellers.
9.3 Survival of Representations and Warranties. The parties
hereto hereby agree that the representations and warranties contained in
this Agreement or in any certificate, document or instrument delivered in
connection herewith, shall survive the execution and delivery of this
Agreement, and the Closing hereunder, regardless of any investigation
made by the parties hereto; provided, however, that any claims or actions
with respect thereto shall terminate unless within thirty-six (36) months
after the Closing Date written notice of such claims is given to the
Sellers or such actions are commenced.
9.4 Costs and Expenses. Except as otherwise provided in this
Agreement, the Sellers and Purchaser shall each bear its own expenses incurred
in connection with the negotiation and execution of this Agreement and each
other agreement, document and instrument contemplated by this Agreement and
the consummation of the transactions contemplated hereby and thereby, it being
understood that in no event shall the Company bear any of such costs and
expenses.
9.5 Specific Performance. The Sellers acknowledge and agree
that the breach of this Agreement would cause irreparable damage to Purchaser
and that Purchaser will not have an adequate remedy at law. Therefore, the
obligations of the Sellers under this Agreement, including, without
limitation, the Sellers' obligation to sell the Shares to Purchaser, shall be
enforceable by a decree of specific performance issued by any court of
competent jurisdiction, and appropriate injunctive relief may be applied for
and granted in connection therewith. Such remedies shall, however, be
cumulative and not exclusive and shall be in addition to any other remedies
which any party may have under this Agreement or otherwise.
9.6 Further Assurances. The Sellers and Purchaser each agrees
to execute and deliver such other documents or agreements and to take such
other action as may be reasonably necessary or desirable for the
implementation of this Agreement and the consummation of the transactions
contemplated hereby.
9.7 Entire Agreement; Amendments and Waivers. This Agreement
(including the schedules and exhibits hereto) represents the entire
understanding and agreement between the parties hereto with respect to
the subject matter hereof and can be amended, supplemented or changed,
and any provision hereof can be waived, only by written instrument making
specific reference to this Agreement signed by the party against whom
enforcement of any such amendment, supplement, modification or waiver is
sought. No action taken pursuant to this Agreement, including without
limitation, any investigation by or on behalf of any party, shall be
deemed to constitute a waiver by the party taking such action of
compliance with any representation, warranty, covenant or agreement
contained herein. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a
further or continuing waiver of such breach or as a waiver of any other
or subsequent breach. No failure on the part of any party to exercise,
and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of
such right, power or remedy by such party preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. All
remedies hereunder are cumulative and are not exclusive of any other
remedies provided by law.
9.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
9.9 Table of Contents and Headings. The table of contents and
section headings of this Agreement are for reference purposes only and
are to be given no effect in the construction or interpretation of this
Agreement.
9.10 Notices. All notices and other communications under this
Agreement shall be in writing and shall be deemed given when delivered
personally or mailed by certified mail, return receipt requested, to the
parties (and shall also be transmitted by facsimile to the Persons
receiving copies thereof) at the following addresses (or to such other
address as a party may have specified by notice given to the other party
pursuant to this provision):
If to any Seller, to:
John J. Donovan, Jr.
219 Vassar Street
Cambridge, MA 02139
Fax: 617-441-8188
With a copy to:
Peabody & Arnold
50 Rowes Wharf
Boston, MA 02110
Attn: William E. Kelly, Esq.
Fax: 617-921-2125
If to Purchaser, to:
Avix Ventures, L.P.
20 Shady Acres
Darien, CT 06820
Attn: Lennart Mengwall
Fax: 203-655-6915
With a copy to:
Brobeck, Phleger & Harrison LLP
1633 Broadway, 47th Floor
New York, New York 10019
Attn: Richard R. Plumridge, Esq.
Fax: 212-586-7878
9.11 Severability. If any provision of this Agreement is
invalid or unenforceable, the balance of this Agreement shall remain in
effect.
9.12 Binding Effect; Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns. Nothing in this Agreement shall create
or be deemed to create any third party beneficiary rights in any person
or entity not a party to this Agreement except as provided below. No
assignment of this Agreement or of any rights or obligations hereunder
may be made by either the Sellers or Purchaser (by operation of law or
otherwise) without the prior written consent of the other parties hereto
and any attempted assignment without the required consents shall be void;
provided, however, that Purchaser may assign this Agreement and any or
all rights or obligations hereunder (including, without limitation,
Purchaser's rights to purchase the Shares and Purchaser's rights to seek
indemnification hereunder) to any Affiliate of the Purchaser. Upon any
such permitted assignment, the references in this Agreement to Purchaser
shall also apply to any such assignee unless the context otherwise
requires.
9.13 Sellers' Representative. John J. Donovan, Jr. and Sundar
Subramaniam, acting jointly, or such other persons as shall succeed them
pursuant to this Section 9.13, are hereby designated as the
representatives (the "Sellers' Representative") to act for and represent
the Sellers with respect to all matters arising out of Section 3.2 hereof
and in those other matters with respect to which this Agreement specifies
that the Sellers' Representative shall so act, as well as matters which
require notice to be given to the Sellers under this Agreement. In the
event of the death or incapacity of Mr. Donovan or Mr. Subramaniam, as
the case may be, the surviving person, or such other person or persons as
may be designated by a majority of the Sellers, shall succeed such person
as the Sellers' Representative.
9.14 Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all
of which taken together shall be deemed to be one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first written above.
AVIX VENTURES, L.P.
By: /s/ Lennart Mengwall
---------------------------------
Name: Lennart Mengwall
Title: General Partner
/s/ Sundar Subramaniam
-------------------------------------
Sundar Subramaniam
J&S LIMITED PARTNERSHIP
By: Controller Corp., Inc.,
its General Partner
By: /s/ John J. Donovan, Sr.
----------------------------------
Name: John J. Donovan, Sr.
Title: President
HARRINGTON TRUST LIMITED,
as Trustee of The Appleby Trust
By: /s/ Martin J. Phillipps
----------------------------------
Name: Martin J. Phillipps
Title: Managing Director
LEGACY INVESTMENT PARTNERSHIP
By: /s/ John J. Donovan, Jr.
----------------------------------
Name: John J. Donovan, Jr.
Title: Managing Partner
ANNEX A
Seller's
Number of Percentage
Name of Seller Shares Owned Interest
- -------------- ------------ ----------
Appleby Trust 2,722,123 35.13%
J&S Limited Partnership 981,978 12.67%
Legacy Investment 1,306,333 16.86%
Partnership
Sundar Subramaniam 2,738,437 35.34%
TOTALS 7,748,871 100.00%
EXHIBIT A
FORM OF NON-RECOURSE PROMISSORY NOTE
THE PROMISSORY NOTE REPRESENTED HEREBY WAS ORIGINALLY ISSUED ON APRIL
- ---, 1997, AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE RESOLD OR OTHERWISE TRANSFERRED WITHOUT
COMPLIANCE THEREWITH OR PURSUANT TO AN EXEMPTION THEREFROM.
NON-RECOURSE PROMISSORY NOTE
U.S. $3,000,000 Boston, Massachusetts
April , 1997
FOR VALUE RECEIVED, the undersigned, AVIX VENTURES, L.P., a
Delaware limited partnership (the "Partnership"), hereby promises to pay
to the order of John J. Donovan, Jr., as agent for each of the Sellers,
as defined and as enumerated on Schedule A hereto, or to any other holder
of this Non-Recourse Promissory Note (the Sellers or such other holder
being the "Payee"), an aggregate principal amount of THREE MILLION UNITED
STATES DOLLARS (U.S. $3,000,000) on October __, 1997 (the "Maturity Date").
Such principal is payable in lawful money of the United States of America
to the Payee at its principal place of business at the addresses set
forth on Schedule A hereto, or at such other place as the Payee may
designate from time to time in writing (such principal place of business
or other place being the "Payment Place"), in cash or other immediately
available funds.
SECTION 1. Payment of Principal. (a) Scheduled Payment. On the
Maturity Date, the Partnership shall pay to the Payee, in cash or other
immediately available funds, the entire unpaid principal amount of this
Note.
(b) Optional Prepayment. The Partnership may, at any time and
from time to time, without premium or penalty, prepay all or a portion of
the unpaid principal amount of this Note, payable in cash or other
immediately available funds. The Partnership shall give written notice of
prepayment of this Note or any portion hereof not less than 10 but not
more than 30 days prior to the date chosen for prepayment, which notice
shall specify the amount thereof to be prepaid and the date fixed for
prepayment. In the event that the Partnership shall prepay less than all
of the outstanding principal amount of this Note, the Partnership shall
deliver to the Payee upon such prepayment a replacement Note representing
the remaining outstanding principal amount of this Note.
SECTION 2. Security. For as long as any principal remains unpaid
under this Note, the Partnership hereby agrees to pledge _________ shares
of the Common Stock, par value $.001 per share, of OneWave, Inc., a
Delaware corporation [representing 50% of all Shares being purchased] as
security for the repayment of principal hereunder. If this Note is not paid
in full at the Maturity Date, the Payee shall have the right to cause the
Depository to liquidate such pledged shares or to transfer such pledged
shares into the name of its nominee or nominees, in each case pursuant to
the terms and conditions of a Pledge Agreement being executed on even date
herewith. The Payee shall have no other recourse against the Partnership
other than the pledged securities referred to in this Section 2.
SECTION 3. Affirmative Covenants. For as long as any principal
remains unpaid under this Note, the Partnership shall give prompt written
notice to the Payee of the occurrence of any Event of Default hereunder;
provided, however, that if any such Event of Default has been promptly
remedied or the Partnership is diligently attempting to remedy such Event
of Default (including the securing of waivers thereof), then the failure
to give notice hereunder shall not in and of itself constitute an Event
of Default hereunder.
SECTION 4. Events of Default. (a) For purposes of this Note, an
"Event of Default" shall be deemed to have occurred upon:
(i) any failure by the Partnership, after notice, to
pay all or any portion of principal under this Note, when the
same shall be due and payable in accordance with the terms
hereof, whether on the Maturity Date, by acceleration or
otherwise; or
(ii) any default by the Partnership in the due and
punctual performance or observance of the covenant of the
Partnership contained in (A) Section 3 of this Note, (B) the
Pledge Agreement or (C) the Stock Purchase Agreement dated as of
April __, 1997 among the Partnership and the Sellers, which
failure continues unremedied for a period of 20 days after
written notice of such default is given by the Payee to the
Partnership; or
(iii) (A) the filing by the Partnership of a
voluntary petition seeking liquidation, reorganization,
arrangement or readjustment, in any form, of its debts under
Title 11 of the United States Code (or corresponding provisions
of future laws) or any other applicable bankruptcy, insolvency
or similar law, or the filing by the Partnership of an answer
consenting to or acquiescing in any such petition, (B) the
making by the Partnership of any assignment for the benefit of
its creditors, or the admission by the Partnership in writing of
its inability to pay its debts as they become due, (C) the
filing of (x) an involuntary petition against the Partnership
under Title 11 of the United States Code, or any other
applicable bankruptcy, insolvency or similar law (or
corresponding provisions of future laws), (y) an application for
the appointment of a custodian, receiver, trustee or other
similar official for the Partnership for all or a substantial
part of the assets of the Partnership or (z) an involuntary
petition against the Partnership seeking liquidation, winding
up, reorganization, arrangement, adjustment, protection, relief
or composition of the Partnership or any of the Partnership's
debts under any other federal or state insolvency law, provided
that any such filing shall not have been vacated, set aside or
stayed within a 90 day period from the date thereof, or (D) the
entry against the Partnership of a final and nonappealable order
for relief under any bankruptcy, insolvency or similar law now
or hereafter in effect.
(b) Upon the occurrence and during the continuance of any Event
of Default described in Section 6(a) other than in clause (iv) thereof,
the Payee may, by written notice to the Partnership, declare all or any
portion of the unpaid principal amount of this Note to be immediately due
and payable. Upon the occurrence of any Event of Default described in
clause (iv) of Section 6(a), the unpaid principal amount of this Note
shall automatically become due and payable, without any action or notice
by the Payee. Demand, presentment, protest and notice of non-payment are
hereby waived by the Partnership.
SECTION 5. Waiver or Alteration. None of the provisions hereof
may be waived, altered or amended, except by a written instrument signed
by the Payee and the Partnership. In the case of any waiver, the
Partnership and the Payee shall be restored to their former respective
positions and rights hereunder, and any Event of Default waived shall be
deemed to be cured and not continuing, but no such waiver shall extend to
any subsequent or other Event of Default or impair any right consequent
thereon except to the extent expressly provided in such waiver.
SECTION 6. Remedies Cumulative. No failure to exercise or delay
in exercising any right, remedy, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein
provided are cumulative and not exclusive of any rights, remedies, powers
and privileges provided by law.
SECTION 7. Notices. Any notices or other communications required
or permitted hereunder shall be given in writing and personally delivered
with receipt acknowledged or mailed, postage prepaid, via registered
mail, return receipt requested, if to the Payee, at its address set forth
on Schedule A hereto or any other address notified in writing by the
Payee to the Partnership, and if to the Partnership, at its address at 20
Shady Acres, Darien, CT 06820, Attention: Lennart Mengwall, or any other
address notified in writing by the Partnership to the Payee. Any notice
given in conformity with the foregoing shall be deemed given when
personally delivered or upon the date of delivery specified in the
registered mail receipt.
SECTION 8. Governing Law. This Note shall be governed by, and
construed and enforced in accordance with the laws of the Commonwealth of
Massachusetts as in effect from time to time, without giving effect to
any choice of laws or conflict of laws principles thereof.
SECTION 9. Severability. If any provision of this Note is
invalid or unenforceable in any jurisdiction, the other provisions hereof
shall remain in full force and effect in such jurisdiction and the
remaining provisions hereof shall be liberally construed in favor of the
holder hereof in order to effectuate the provisions hereof and the
invalidity of any provision hereof in any jurisdiction shall not affect
the validity or enforceability of any other provision in any other
jurisdiction, including the State of Delaware.
SECTION 10. Costs of Collection. If the Payee is required to
commence suit to recover any amount due under this Note following an
Event of Default, the Payee shall be entitled to collect from the
Partnership reimbursement of such reasonable attorneys' fees and expenses
as may be actually incurred by the Payee at normal hourly rates of
counsel selected by the Payee in collecting or attempting to collect any
amount due hereunder.
SECTION 11. Successors and Assigns; Transferability. This Note
shall be binding upon and inure to the benefit of the Payee and the
Partnership and their respective transferees, successors and assigns;
provided, however, that the Partnership may not transfer or assign any of
its rights or obligations hereunder without the prior written consent of
the Payee. Within five Business Days after receipt of notice of any
assignment by the Payee to any person or entity (an "Assignee") of all or
any part of this Note, the Partnership shall execute and deliver to such
Assignee, in exchange for the surrendered Note or Notes, a new Note to
the order of such Assignee in an amount equal to the amount of this Note
assigned to it, and if the Payee has retained any amount owing to it
hereunder, a new Note to the order of the Payee in an amount equal to the
amount retained by it hereunder, which new Note or Notes shall be dated
the same date as the surrendered Note or Notes and be in substantially
the form of this Note, and such Assignee will be deemed the Payee under
the Note issued to it.
SECTION 12. Replacement of Note. Upon receipt of evidence
reasonably satisfactory to the Partnership of the loss, theft,
destruction or mutilation of this Note, and the Partnership's receipt of
an indemnity agreement of the Payee reasonably satisfactory to the
Partnership, the Partnership will, at the expense of the Payee, execute
and deliver, in lieu thereof, a new Note of like terms.
SECTION 13. No Set-Off. The obligations of the Partnership under
this Note are absolute and not subject to any right of set-off,
counterclaim, recoupment or defenses against the Payee of any kind
whatsoever.
SECTION 14. Descriptive Headings. The descriptive headings of
this Note are inserted for convenience only and do not constitute a part
of this Note.
IN WITNESS WHEREOF, each of the Partnership and the Sellers
have caused this Note to be executed as of the day and year first written
above.
AVIX VENTURES, L.P.
By:----------------------------------
Name: Lennart Mengwall
Title: General Partner
-------------------------------------
Sundar Subramaniam
J&S LIMITED PARTNERSHIP
By: Controller Corp., Inc.,
its General Partner
By:----------------------------------
Name: John J. Donovan, Sr.
Title: President
HARRINGTON TRUST LIMITED,
as Trustee of The Appleby Trust
By:----------------------------------
Name: Martin J. Phillipps
Title: Managing Director
LEGACY INVESTMENT PARTNERSHIP
By:----------------------------------
Name: John J. Donovan, Jr.
Title: Managing Partner
SCHEDULE A
NAMES AND ADDRESSES OF SELLERS
Harrington Trust Limited,
Trustee of The Appleby Trust
Cedar House
41 Cedar Avenue
Hamilton HM12, Bermuda
Sundar Subramaniam
219 Vassar Street
Cambridge, MA 02139
J&S Limited Partnership
219 Vassar Street
Cambridge, MA 02139
Legacy Investment Partnership
219 Vassar Street
Cambridge, MA 02139
EXHIBIT B
FORM OF PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (the "Pledge Agreement"), dated as of
April __, 1997, is made among AVIX VENTURES, L.P., a Delaware limited
partnership (the "Pledgor"), the Sellers listed on Schedule A of each of
the two Non-Recourse Promissory Notes, of even date herewith (the
"Notes"), among the Pledgor and each of the Sellers enumerated on
Schedule A thereto (the "Pledgees") and The State Street Bank & Trust
Company, as depositary bank (in such capacity, the "Depositary"). All
terms used but not defined herein shall have the meanings ascribed to
such terms in that certain Stock Purchase Agreement, made as of the
_____ day of April, 1997, by and among Avix Ventures, L.P. and Appleby
Trust, by Harrington Trust Limited, as trustee, J&S Limited Partnership,
Legacy Investment Partnership and Sundar Subramaniam.
It is a condition of the Notes that the Pledgor enter into this
Agreement and pledge to the Pledgees 4,843,044 shares, representing 62.5%
of the Shares (the "Pledged Securities") of the Common Stock, par value
$.001 per share, of OneWave, Inc., a Delaware corporation, to secure the
obligations of the Pledgor described below.
Accordingly, the parties hereto agree as follows:
SECTION 1 Definitions.
(a) Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Deposit Account" means the special purpose restricted deposit
account of the Pledgor with the Depositary established pursuant to
Section 3.
"Financing Statements" has the meaning set forth in Section
2(c).
"Pledged Collateral" has the meaning set forth in Section 2.
"UCC" means the Uniform Commercial Code as the same may, from
time to time, be in effect in the Commonwealth of Massachusetts;
provided, however, in the event that, by reason of mandatory provisions
of law, any or all of the attachment, perfection or priority of the
security interest in any Pledged Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than the
Commonwealth of Massachusetts, the term "UCC" shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection or priority
and for purposes of definitions related to such provisions.
(b) Terms Defined in UCC. Where applicable and except as
otherwise defined herein, terms used in this Agreement shall have the
meanings assigned to them in the UCC.
SECTION 2 Security Interest.
(a) Grant of Security Interest. As security for the performance
of its obligations under the Notes, the Pledgor hereby pledges, assigns,
transfers, hypothecates and sets over to the Pledgees, and hereby grants
to the Pledgees a security interest in, all of the Pledgor's right, title
and interest in, to and under (i) the Deposit Account, all Pledged
Securities held therein, and any cash interest or dividends paid thereon,
(ii) all rights, interests and claims with respect to the Deposit
Account, including all such rights, interest and claims under all related
agreements, instruments and other documents, and in respect of all
guaranties, security, letters of credit, insurance, warranties and other
undertakings, (iii) all books, records and other documentation of the
Pledgor related to the Deposit Account, and (iv) all proceeds of any and
all of the foregoing, in each case whether presently existing or owned or
hereafter arising or acquired and wherever located (collectively, the
"Pledged Collateral"). Notwithstanding any other provision herein, the
Pledgor shall retain its right to vote in all stockholder votes held at
all times unless and until the Pledgees have directed the Depositary to
transfer or deliver any of the Pledged Collateral to the Pledgees upon
the occurrence of an Event of Default (as hereinafter defined).
(b) Notice of Security Interest. In accordance with Section
8-313 of the Massachusetts UCC, written notice of the security interest
of the Pledgees in the Deposit Account is hereby given to the Depositary.
(c) Financing Statements, Etc. The Pledgor shall execute and
deliver to the Pledgees at any time and from time to time, all financing
statements, continuation financing statements, termination statements,
notices, and all other documents and instruments (the "Financing
Statements") which the Pledgees may request, in form satisfactory to the
Pledgees, to perfect and continue perfected, maintain the priority of or
provide notice of the pledge of and security interest in the Pledged
Collateral and to accomplish the purposes of this Agreement.
(d) Continuing Security Interest. The Pledgor agrees that this
Agreement shall create a continuing security interest in and pledge of
the Pledged Collateral which shall remain in effect until terminated in
accordance with Section 16.
SECTION 3 The Deposit Account; Administration of the Pledged
Collateral.
(a) Establishment of Deposit Account. For purposes of this
Agreement, the Depositary has established for the Pledgor a special
purpose deposit account more fully described in Schedule 1 (the "Deposit
Account") over which the Pledgees shall have exclusive control and the
sole right of withdrawal. The Pledgor agrees that except as otherwise
expressly provided in this Agreement, upon the irrevocable deposit of the
Pledged Securities into the Deposit Account, the Pledgor shall not have
any right of withdrawal with respect to such securities, or any cash
interest or dividends which may accrue with respect to such securities
and/or funds in the Deposit Account for so long as the obligations of the
Pledgor under either or both of the Non-Recourse Promissory Notes (the
"Secured Obligation") has not been performed in full. The Pledgor
irrevocably waives until the termination of this Agreement in accordance
with Section 16 (i) the right to make withdrawals from the Deposit
Account; and (ii) the right to instruct the Depositary to honor drafts
drawn against the Deposit Account.
(b) Appointment of Depositary; Pledged Collateral. The Pledgees
hereby appoints The State Street Bank & Trust Company as Depositary
hereunder. The State Street Bank & Trust Company hereby agrees to act as
Depositary hereunder and to accept and hold in accordance with the terms
and conditions of this Agreement the Pledged Securities deposited into
the Deposit Account hereunder and other Pledged Collateral transferred or
delivered to it hereunder and to release such funds and other Pledged
Collateral to the Pledgees pursuant to the terms and conditions hereof.
The Depositary agrees to maintain the Deposit Account separately and
wholly segregated from all other securities, investments, instruments and
funds on deposit with or held by the Depositary.
(c) Interest on the Deposit Account. Interest on the cash funds
on deposit with the Depositary in the Deposit Account shall accrue at a
rate per annum equal at all times to the rate specified by the Depositary
as its money market rate and shall be paid into the Deposit Account on
the fifth business day after the end of each month, including the month
in which the Deposit Account is terminated. No interest shall accrue on
any amount deposited into the Deposit Account if such amount is withdrawn
on the date of deposit. All computations of interest in respect of the
Deposit Account shall be made on the basis of a year of 365 days for the
actual number of days (including the first day but excluding the last
day) occurring in the period for which such interest is payable. Each
determination by the Depositary hereunder of a rate of interest and of
any change therein and the calculation of interest payable in the absence
of manifest error shall be conclusive and binding on the parties.
(d) Statements. The Depositary shall provide to the Pledgees and
the Pledgor a quarterly statement listing the balance of the Deposit
Account and the other Pledged Collateral, if any, then held by the
Depositary.
(e) Pledgees's General Authority.
(i) The Pledgees shall have the right upon the occurrence of an
Event of Default, following prior written notice to the Pledgor, directly
or through the Depositary, to vote and to give consents, ratifications
and waivers with respect to the Pledged Collateral and exercise all
rights of conversion, exchange, subscription or any other rights,
privileges or options pertaining to the Pledged Collateral, as if the
Pledgees were the absolute owner thereof; provided that the Pledgees
shall have no duty to exercise any of the foregoing rights afforded to it
and shall not be responsible to the Pledgor or any other Person for any
failure to do so or delay in doing so.
(ii) The Pledgees shall have the right, for and in the name,
place and stead of the Pledgor, to execute endorsements, assignments or
other instruments of conveyance or transfer with respect to all or any of
the Pledged Collateral, to endorse any checks, drafts, money orders and
other instruments relating thereto; upon and after the occurrence of any
Event of Default, to sue for, collect, receive and give acquittance for
all moneys due or to become due in connection with the Pledged Collateral
and otherwise to file any claims, take any action or institute, defend,
settle or adjust any actions, suits or proceedings with respect to the
Pledged Collateral; and to execute any and all such other documents and
instruments, and do any and all such acts and things, as the Pledgees may
deem necessary or desirable to protect, collect, realize upon and
preserve the Pledged Collateral, to enforce the Pledgees's rights with
respect to the Pledged Collateral and to accomplish the purposes of this
Agreement.
(iii) At any time and from time to time, the Pledgees may cause
any of the Pledged Collateral to be held in, or transferred into, its
name or into the name of its nominee or nominees. The Pledgees shall at
all times have the right to exchange uncertificated Pledged Collateral
for certificated Pledged Collateral, and to exchange certificated Pledged
Collateral for certificates of larger or smaller denominations, for any
purpose consistent with this Agreement.
(iv) Beyond the exercise of reasonable care by the Depositary to
assure the safe custody of Pledged Collateral while held hereunder and
the accounting for moneys actually received by the Pledgees or the
Depositary with respect thereto, neither the Pledgees nor the Depositary
shall have any duty or liability to exercise or preserve any rights,
privileges or powers pertaining to the Pledged Collateral.
(f) Appointment of Pledgees as Attorney-in-Fact. For the purpose
of enabling the Pledgees to exercise its rights under this Section 3 or
otherwise in connection with this Agreement, the Pledgor hereby
constitutes and appoints the Pledgees (and any of the Pledgees's
officers, employees or agents designated by the Pledgees) its true and
lawful attorney-in-fact, with full power and authority to (i) sign any
Financing Statements which must be executed or filed to perfect or
continue perfected, maintain the priority of or provide notice of the
pledge of and security interest in the Pledged Collateral, (ii) make any
deposit or withdrawal or order any transfer of funds to or from the
Deposit Account, and (iii) collect any Pledged Collateral, execute any
notice, assignment, endorsement or other instrument or document, and do
any and all acts and things for and on behalf of the Pledgor, which the
Pledgees may deem necessary or desirable to protect, collect, realize
upon and preserve the Pledged Collateral, to enforce the Pledgees's
rights with respect to the Pledged Collateral and to accomplish the
purposes hereof. Such appointment is coupled with an interest and
irrevocable so long as the Secured Obligation has not been performed in
full. The Pledgor hereby ratifies, to the extent permitted by law, all
that the Pledgees shall lawfully and in good faith do or cause to be done
by virtue of and in compliance with this Section 3(f).
(g) Depositary Acts as Agent of Pledgees. The Pledgor
understands and agrees that the Depositary is acting hereunder, and
holding all Pledged Collateral hereunder, solely as the agent and for the
benefit of, the Pledgees.
(h) Depositary Waiver. The Depositary shall hold the Pledged
Collateral free of, and hereby waives, any Liens, charges, demands, or
other claims which it may have upon or with respect to the Pledged
Collateral.
(i) Concerning the Depositary. The Depositary is authorized to
take such action and exercise such powers under this Agreement as are
delegated to the Depositary by the terms hereof, together with such
powers as are reasonably incidental thereto. The duties and obligations
of the Depositary are strictly limited to those expressly provided for
herein, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise
exist against the Depositary. As to any matters not expressly provided
for by this Agreement (including the timing and methods of realization
upon the Pledged Collateral), the Depositary shall act or refrain from
acting (and shall be fully protected in so acting or refraining from
acting) upon the instructions of the Pledgees, except that in the absence
of such instructions the Depositary may, but shall not be required to,
exercise its discretion to act or refrain from acting. The Depositary
shall not be required to take any action hereunder which exposes the
Depositary to liability or which is contrary to this Agreement or
applicable law. Nothing in this Agreement shall, or shall be construed
to, constitute the Depositary a trustee or fiduciary for the Pledgees. In
performing its functions and duties hereunder, the Depositary does not
assume and shall not be deemed to have assumed any obligation towards or
relationship of agency or trust with or for the Pledgor. Neither the
Depositary nor any affiliate thereof nor any of their respective
directors, officers, employees or agents shall be liable for any action
taken or omitted to be taken by it or them under or in connection with
this Agreement, except for its or their own gross negligence or willful
misconduct.
(j) Resignation or Removal of Depositary.
(i) Subject to the further provisions of this subsection (i),
the Depositary may resign at any time as Depositary hereunder by its
delivery to the Pledgor and the Pledgees of written notice of
resignation. The Depositary may be removed by the Pledgees at any time,
with or without cause, by written notice of removal delivered to the
Depositary. Upon any such resignation or removal the Pledgees may,
without other formality than appointment and designation in writing,
appoint a successor Depositary.
(ii) Upon acceptance by a qualified successor Depositary of
its appointment hereunder, and upon payment of the retiring Depositary's
accrued charges and fees hereunder, the retiring Depositary shall
transmit to such successor for deposit in the Deposit Account established
by such successor, all funds, if any, then on deposit in the Deposit
Account, and shall deliver to such successor all other Pledged Collateral
then held by it hereunder, against receipt by such successor.
(iii) Anything herein to the contrary notwithstanding, the
Depositary shall not be discharged from its duties or obligations
hereunder following its resignation or removal until: (A) a successor
Depositary has been appointed by the Pledgees and has accepted its
appointment hereunder; (B) a new Deposit Account has been established by
such successor for purposes of this Agreement; (C) all Pledged Collateral
then held by the retiring Depositary hereunder have been delivered to
such successor; (D) all funds maintained by the retiring Depositary in
the Deposit Account, have been remitted to such successor for deposit in
such new Deposit Account; (E) all notices to third parties required to be
given have been given by the Pledgor; (F) all action required by the
Pledgees has been taken to continue the Pledgees's perfected first
priority security interest in the Pledged Collateral; and (G) such
successor has executed and delivered such agreements and instruments as
the Pledgor or the Pledgees may have requested in connection with such
successor's appointment as Depositary.
(iv) Any successor Depositary hereunder shall provide the
Pledgor and the Pledgees with its address, telephone, and facsimile
numbers, to be used for purposes of Section 7.
(v) Any successor Depositary hereunder shall be a bank or trust
company having an office in New York, New York, be a member of the
Federal Reserve System and be authorized to accept deposits and offer
checking account facilities.
SECTION 4 Covenants. So long as the Secured Obligation remains
unsatisfied, the Pledgor agrees that:
(a) Preservation of Collateral. The Pledgor will do and perform
all reasonable acts that may be necessary and appropriate to maintain,
preserve and protect the Pledged Collateral.
(b) Compliance with Laws, Etc. The Pledgor will comply with all
laws, regulations and ordinances relating in a material way to the
possession, maintenance and control of the Pledged Collateral.
(c) Disposition of Pledged Collateral. The Pledgor will not
surrender or lose possession of (other than to the Pledgees or the
Depositary or, with the prior consent of the Pledgees, to any other
depositary or financial intermediary), exchange, sell, convey, assign or
otherwise dispose of or transfer the Pledged Collateral or any right,
title or interest therein.
(d) Liens. The Pledgor will not create, incur or permit to exist
any Liens upon or with respect to the Pledged Collateral, other than the
security interest of and pledge to the Pledgees created by this
Agreement.
(e) Further Assurances. The Pledgor will promptly, upon the
written request from time to time of the Pledgees or the Depositary,
execute, acknowledge and deliver, and file and record, all such financing
statements and other documents and instruments, and take all such action,
as shall be reasonably necessary to carry out the purposes of this
Agreement.
SECTION 5 Remedies.
(a) Remedies. If an event of default occurs pursuant to the
terms of the Notes (an "Event of Default"), then the Pledgees shall have,
in addition to all other rights and remedies granted to it in this
Agreement, all rights and remedies of a secured party under the UCC and
other applicable laws.
(b) Release of Deposit Account and Pledged Collateral to
Pledgees. Upon the occurrence of the Event of Default and subject to the
last sentence of this Section 5(b), the Pledgees may deliver to the
Depositary a notice directing the Depositary to release all or any part
of the balance of the Deposit Account to the Pledgees and transfer or
deliver to the Pledgees, or dispose of, any Pledged Collateral. Upon
receipt of such notice and in accordance with the Pledgees's written
direction, the Depositary shall forthwith (i) pay to the Pledgees all or
any portion of the cash in the Deposit Account and (ii) as to any Pledged
Collateral, either (A) transfer and deliver such Pledged Collateral to
the Pledgees (along with appropriate endorsements, assignments or other
similar documentation) for sale or other disposition by the Pledgees or
(B) sell or otherwise dispose of such Pledged Collateral and remit to the
Pledgees forthwith the proceeds of such sale or disposition. The Pledgor
acknowledges and agrees that any such release of funds in the Deposit
Account, or any sale or other disposition of Pledged Collateral by the
Depositary or the Pledgees, may result in the liquidation of time
deposits constituting all or a portion of the Pledged Collateral, whether
or not such time deposits have matured and notwithstanding the fact
that such liquidation may give rise to penalties or other breakage costs
as a result of an early withdrawal of funds. Notwithstanding the
foregoing, should the Pledgees elect to exercise its rights pursuant to
this Section 5(b), such election shall be deemed to reduce any obligation
of the Pledgor to pay any amounts to the Pledgees in connection with such
sale of the Pledged Collateral.
SECTION 6 Certain Waivers. The Pledgor waives, to the fullest
extent permitted by law, (i) any right to require the Pledgees (A) to
proceed against any Person, (B) to exhaust any other collateral or
security for the Secured Obligation, (C) to pursue any remedy in the
Pledgees's power, or (D) to make or give any presentments, demands for
performance, notices of nonperformance, protests, notices of protests or
notices of dishonor in connection with any of the Pledged Collateral; and
(ii) all claims, damages, and demands against the Pledgees arising out of
the repossession, retention, sale or application of the proceeds of any
sale of the Pledged Collateral.
SECTION 7 Notices. All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing
(including by facsimile transmission) and shall be mailed, sent or
delivered at or to the address or facsimile number of the respective
party or parties set forth on the signature pages hereof, or at or to
such other address or facsimile number as such party or parties shall
have designated in a written notice to the other party or parties. All
such notices and communications shall be effective (i) if delivered by
hand, when delivered; (ii) if sent by mail, upon the earlier of the date
of receipt or five (5) Business Days after deposit in the mail, first
class (or air mail, with respect to communications to be sent to or from
the United States), postage prepaid; and (iii) if sent by facsimile
transmission, when sent; except that notices from the Pledgor under
Section 3 shall not be effective until actually received. Instructions
for the disbursement of funds, or any other assets in the Deposit
Account, shall be made only upon Depositary's receipt of written
instructions, which may include instructions sent by facsimile
transmission. The Depositary shall be entitled to rely upon any notices,
communications or instructions that the Depositary deems to be
reasonable.
SECTION 8 No Waiver; Cumulative Remedies. No failure on the part
of the Depositary or the Pledgees to exercise, and no delay in
exercising, any right, remedy, power or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such
right, remedy, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege.
The rights and remedies under this Agreement are cumulative and not
exclusive of any rights, remedies, powers and privileges that may
otherwise be available to the Depositary or the Pledgees.
SECTION 9 Costs and Expenses; Other Charges.
(a) Costs and Expenses. The Pledgor agrees to pay on demand:
(i) the reasonable out-of-pocket costs and expenses of the
Depositary and any of its affiliates, and the reasonable fees and
disbursements of counsel to the Depositary, in connection with the
negotiation, preparation, execution, delivery and administration of this
Agreement, and any amendments, modifications or waivers of the terms
thereof, and the custody of the Pledged Collateral;
(ii) all title, appraisal (including the allocated cost of
internal appraisal services), survey, audit, consulting, search,
recording, filing and similar costs, fees and expenses incurred or
sustained by the Pledgees, the Depositary or any of their respective
Affiliates in connection with this Agreement or the Pledged Collateral;
and
(iii) all costs and expenses of the Pledgees, the Depositary and
their respective Affiliates, and the fees and disbursements of counsel
(including the allocated costs of internal counsel), in connection with
the enforcement or attempted enforcement of, and preservation of any
rights or interest under, this Agreement, any out-of-court workout or
other refinancing or restructuring or in any bankruptcy case, and the
protection, sale or collection of, or other realization upon, any of the
Pledged Collateral, including any and all losses, costs and expenses
sustained by the Pledgees or the Depositary as a result of any failure by
the Pledgor to perform or observe its obligations contained herein.
(b) Interest. Any cash amounts payable to the Pledgees or the
Depositary under this Section 9 or otherwise under this Agreement if not
paid upon demand shall bear interest from the date of such demand until
paid in full, at the prime rate of interest then being charged by the
Depositary.
SECTION 10 Binding Effect. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the Pledgor, the Depositary
and the Pledgees and their respective successors and assigns.
SECTION 11 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF
MASSACHUSETTS, EXCEPT AS REQUIRED BY MANDATORY PROVISIONS OF LAW AND TO
THE EXTENT THE VALIDITY OR PERFECTION OF THE SECURITY INTERESTS
HEREUNDER, OR THE REMEDIES HEREUNDER, IN RESPECT OF ANY PLEDGED
COLLATERAL ARE GOVERNED BY THE LAW OF A JURISDICTION OTHER THAN THE
COMMONWEALTH OF MASSACHUSETTS.
SECTION 12 Entire Agreement; Amendment.
(a) Entire Agreement. This Agreement constitutes the entire
agreement of the Pledgor, the Pledgees and the Depositary with respect to
the matters set forth herein and supersedes any prior agreements,
commitments, discussions and understandings, oral or written, with
respect thereto.
(b) Amendments and Waivers. This Agreement may not be amended
except by a writing signed by the Pledgor, the Depositary and the
Pledgees. No waiver of any rights of the Pledgees under any provision of
this Agreement or consent to any departure by the Pledgor or the
Depositary therefrom shall be effective unless in writing and signed by
the Depositary and the Pledgees. Any such amendment, waiver or consent
shall be effective only in the specific instance and for the specific
purpose for which given.
SECTION 13 Severability. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and
valid under all applicable laws and regulations. If, however, any
provision of this Agreement shall be prohibited by or invalid under any
such law or regulation in any jurisdiction, it shall, as to such
jurisdiction, be deemed modified to conform to the minimum requirements
of such law or regulation, or, if for any reason it is not deemed so
modified, it shall be ineffective and invalid only to the extent of such
prohibition or invalidity without affecting the remaining provisions of
this Agreement, or the validity or effectiveness of such provision in any
other jurisdiction.
SECTION 14 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute but one and the
same agreement.
SECTION 15 No Inconsistent Requirements. The Pledgor
acknowledges that this Agreement may contain covenants and other terms
and provisions variously stated regarding the same or similar matters,
and agrees that all such covenants, terms and provisions are cumulative
and all shall be performed and satisfied in accordance with their
respective terms.
SECTION 16 Termination.
(a) Upon the performance in full of the Pledgor's obligations
under the Non-Recourse Promissory Note in the aggregate principal amount
of $3,000,000, this Agreement shall terminate with respect to 2,905,827
of the shares of Common Stock of the Company and the Pledgees shall
promptly instruct the Depositary in writing, which may include
instructions sent by facsimile transmission, to give the Pledgor full
access to and control over such shares of Common Stock, and each of the
Pledgees and the Depositary shall execute and deliver to the Pledgor such
documents and instruments reasonably requested by the Pledgor as shall be
necessary to evidence termination of the security interests given by the
Pledgor to the Pledgees hereunder relating to such shares. Upon such an
occurrence, the defined term Pledged Securities shall be re-defined to
mean 1,937,217 shares of Common Stock of the Company.
(b) Upon the performance in full of the Pledgor's obligations
under both the Non-Recourse Promissory Note in the aggregate principal
amount of $3,000,000 and the Non-Recourse Note in the aggregate principal
amount of $2,000,000, this Agreement shall terminate and the Pledgees
shall promptly instruct the Depositary in writing, which may include
instructions sent by facsimile transmission, to give the Pledgor full
access to and control over the Deposit Account and to transfer or
deliver, or cause to be transferred or delivered, to the Pledgor any
Pledged Collateral held by or for the Depositary, and each of the
Pledgees and the Depositary shall execute and deliver to the Pledgor such
documents and instruments reasonably requested by the Pledgor as shall be
necessary to evidence termination of all security interests given by the
Pledgor to the Pledgees hereunder.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, as of the date first above written.
THE PLEDGOR
AVIX VENTURES, L.P.
By:--------------------------------
Name: Lennart Mengwall
Title: General Partner
THE DEPOSITARY
THE STATE STREET BANK & TRUST COMPANY
By:--------------------------------
Name:
Title:
THE PLEDGEES
-----------------------------------
Sundar Subramaniam
J&S LIMITED PARTNERSHIP
By: Controller Corp., Inc.,
its General Partner
By:-------------------------------
Name: John J. Donovan, Sr.
Title: President
HARRINGTON TRUST LIMITED,
as Trustee of The Appleby Trust
By:-------------------------------
Name: Martin J. Phillipps
Title: Managing Director
LEGACY INVESTMENT PARTNERSHIP
By:-------------------------------
Name: John J. Donovan, Jr.
Title: Managing Partner
SCHEDULE 1
to the Pledge Agreement
DEPOSIT ACCOUNT
SCHEDULE 4.4
LIENS
The Shares owned by J&S Limited Partnership are pledged to The State
Street Bank & Trust Company, Boston, Massachusetts.
120,000 of the Shares owned by Appleby Trust are pledged to Permal
Private Equity Partners and Private Equity Partners.
SCHEDULE 4.5
RELATED PARTY TRANSACTIONS
1. The Company has sold software licenses and was engaged to develop
applications as subcontractor for Hewlett-Packard Company in connection
with the development of vertical applications for Internet Business
Systems Incorporated ("IBS"). Mr. Subramaniam and John J. Donovan, Sr.
are directors of IBS, and 50% of the outstanding voting stock of IBS is
owned by a limited liability company of which trusts for the benefit of
Mr. Subramaniam and members of the Donovan family are members and
Controller Corp., Inc. (the general partner of J&S Limited Partnership)
is the manager. The parties contemplated that substantially all of the
funding for such licenses and services would be provided by IBS and other
entities affiliated with the Sellers. The licensed software has not been
delivered to IBS and, to the Sellers' knowledge, the development of the
applications has not been satisfactorily completed. IBS and J&S Limited
Partnership are engaged in discussions with Hewlett-Packard Company and
the Company regarding this project.
2. International Integration Incorporated, of which Mr. Subramaniam and a
partnership between Mr. Subramaniam and The Appleby Trust are
stockholders, has acted as a reseller of the Company's products.
3. Several entities affiliated with the Sellers held licenses for use
and/or resale of the Company's products. The Company has demanded that
all affiliates of the Sellers terminate their use of the Company's
products.
SCHEDULE 4.8
FINANCIAL ADVISORS
None
EXHIBIT B
JOINT FILING AGREEMENT
In accordance with Rule 13-1(f) under the Securities Exchange Act of
1934, as amended, the undersigned agree to the joint filing on behalf of
each of them of a statement on Schedule 13D (including amendments
thereto) with respect to the common stock, par value $.001 per share, of
OneWave, Inc., a Delaware corporation, and further agree that this Joint
Filing Agreement be included as an Exhibit to such joint filings. In
evidence thereof, the undersigned, being duly authorized, have executed
this Joint Filing Agreement this 28th day of April, 1997.
/s/ Sundar Subramaniam
-------------------------
Sundar Subramaniam
LEGACY INVESTMENT PARTNERSHIP
By:/s/ John J. Donovan, Jr.
-------------------------
John J. Donovan, Jr.
Managing Partner
By:/s/ James H. Donovan
-------------------------
James H. Donovan
By:/s/ Carolyn S. Donovan
-------------------------
Carolyn S. Donovan
By:/s/ Maureen D. Lantz
-------------------------
Maureen D. Lantz
By:/s/ Rebecca M. Donovan
-------------------------
Rebecca M. Donovan
J&S LIMITED PARTNERSHIP
By: CONTROLLER CORP., INC.
General Partner
By:/s/ John J. Donovan, Sr.
-------------------------
John J. Donovan, Sr.
President
HARRINGTON TRUST LIMITED, as
Trustee of the APPLEBY TRUST
By:/s/ Martin Phillipps
-------------------------
Martin Phillipps
Managing Director
<TABLE>
<CAPTION>
EXHIBIT C
RESIDENCE OR PRINCIPAL OCCUPATION STATE OF INCORPORATION
NAME BUSINESS ADDRESS OR EMPLOYMENT OR CITIZENSHIP
<S> <C> <C> <C>
Sundar Subramaniam 219 Vassar Street Consultant, Cambridge India
Cambridge, MA 02139 Technology Group
Legacy Investment 219 Vassar Street Venture Capital Massachusetts
Partnership Cambridge, MA 02139 Investment
John J. Donovan, Jr. 219 Vassar Street Manager of Strategic United States of America
Cambridge, MA 02139 Relations, Cambridge
Technology Group
James H. Donovan 53 State Street Investment Banker, United States of America
Boston, MA 02109 Goldman Sachs & Co.
Carolyn S. Donovan 2809 Boston Street #356 Resident M.D., Johns United States of America
Baltimore, MD 21224 Hopkins Hospital,
Baltimore, MD
Maureen D. Lantz 232 Powder Mill Road Housewife United States of America
Concord, MA 01742
Rebecca M. Donovan 5537 North Military Trail Business School United States of America
#1906 Graduate
Boca Raton, FL 33496
J&S Limited Partnership 219 Vassar Street Investment Partnership Massachusetts
Cambridge, MA 02139
Controller Corp., Inc. 219 Vassar Street General Partner of Massachusetts
Cambridge, MA 02139 J&S
John J. Donovan, Sr. 219 Vassar Street Chairman, Cambridge United States of America
Cambridge, MA 02139 Technology Group
Harrington Trust Limited, Cedar House Trustee Bermuda
as Trustee of The Appleby 41 Cedar Avenue
Trust Hamilton, Bermuda HM12
</TABLE>
<TABLE>
<CAPTION>
SCHEDULE I
BENEFICIAL OWNERSHIP OF REPORTING PERSONS
NUMBER OF NUMBER OF
NUMBER AND NUMBER OF NUMBER OF SHARES SOLE SHARES SHARED
PERCENTAGE SHARES SOLE SHARES SHARED POWER TO POWER TO
OF SHARES POWER TO VOTE POWER TO DISPOSE OR DISPOSE OR
BENEFICIALLY OR DIRECT VOTE OR DIRECT DIRECT THE DIRECT THE
NAME OWNED THE VOTE THE VOTE DISPOSITION DISPOSITION
<S> <C> <C> <C> <C> <C> <C>
Sundar Subramaniam (1) 2,738,437 2,738,437 0 2,738,437 0
(18.5%)
Legacy Investment Partnership 1,306,333 1,306,333 0 1,306,333 0
(8.8%)
John J. Donovan, Jr. (2) (9) 261,266.6 0 1,306,333 0 1,306,333
(1.8%)
James H. Donovan (3) (9) 261,266.6 0 1,306,333 0 1,306,333
(1.8%)
Carolyn S. Donovan (4) (9) 261,266.6 0 1,306,333 0 1,306,333
(1.8%)
Maureen D. Lantz (5) (9) 261,266.6 0 1,306,333 0 1,306,333
(1.8%)
Rebecca M. Donovan (6) (9) 261,266.6 0 1,306,333 0 1,306,333
(1.8%)
J&S Limited Partnership 981,978 981,978 0 981,978 0
(6.6%)
Controller Corp., Inc. (7) 0 981,978 0 981,978 0
(N/A)
John J. Donovan, Sr. (8) 490,989 981,978 0 981,978 0
(3.3%)
Harrington Trust Limited, as 2,722,123 2,722,123 0 2,722,123 0
Trustee of The Appleby Trust (18.4%)
(9)
</TABLE>
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1. Sundar Subramaniam holds a 50% beneficial interest in
J&S which holds 981,978 shares of Common Stock. Mr.
Subramaniam exercises no voting or investment power
over the shares held by J&S, and he disclaims
beneficial ownership thereof.
2. John J. Donovan, Jr. disclaims beneficial ownership of
four-fifths of the shares of Common Stock held by
Legacy which represents the proportionate interest of
the other general partners of Legacy. The filing of
this Schedule 13D shall not be construed as an
admission that John J. Donovan, Jr. is, for the pur-
poses of Sections 13(d) or 13(g) under the Act, the
beneficial owner of four-fifths of the shares of
Common Stock held by Legacy.
3. James H. Donovan disclaims beneficial ownership of
four-fifths of the shares of Common Stock held by Legacy
which represents the proportionate interest of the
other general partners of Legacy. The filing of this
Schedule 13D shall not be construed as an admission
that James H. Donovan is, for the purposes of Sec-
tions 13(d) or 13(g) under the Act, the beneficial
owner of four-fifths of the shares of Common Stock
held by Legacy.
4. Carolyn S. Donovan disclaims beneficial ownership of
four-fifths of the shares of Common Stock held by
Legacy which represents the proportionate interest of
the other general partners of Legacy. The filing of
this Schedule 13D shall not be construed as an admis-
sion that Carolyn S. Donovan is, for the purposes of
Sections 13(d) or 13(g) under the Act, the beneficial
owner of four-fifths of the shares of Common Stock
held by Legacy.
5. Maureen D. Lantz disclaims beneficial ownership of
four-fifths of the shares of Common Stock held by Legacy
which represents the proportionate interest of the
other general partners of Legacy. The filing of this
Schedule 13D shall not be construed as an admission
that Maureen D. Lantz is, for the purposes of Sec-
tions 13(d) or 13(g) under the Act, the beneficial
owner of four-fifths of the shares of Common Stock
held by Legacy.
6. Rebecca M. Donovan disclaims beneficial ownership of
four-fifths of the shares of Common Stock held by
Legacy which represents the proportionate interest of
the other general partners of Legacy. The filing of
this Schedule 13D shall not be construed as an admis-
sion that Rebecca M. Donovan is, for the purposes of
Sections 13(d) or 13(g) under the Act, the beneficial
owner of four-fifths of the shares of Common Stock
held by Legacy.
7. Controller Corp., Inc., as the sole General Partner of
J&S, disclaims beneficial ownership of the shares of
Common Stock held by J&S. The filing of this Schedule
13D shall not be construed as an admission that
Controller Corp., Inc. is, for the purposes of Section 13(d)
or 13(g) under the Act, the beneficial owner of the
shares of Common Stock held by J&S.
8. John J. Donovan, Sr. is a limited partner of J&S and
the sole stockholder of the sole general partner of
J&S. He disclaims beneficial ownership of 490,989
shares of Common Stock, representing the portion of
the shares held by J&S that constitute the beneficial
interest of the other limited partner of J&S. The
filing of this Schedule 13D shall not be construed as
an admission that John J. Donovan, Sr. is, for the
purposes of Sections 13(d) or 13(g) under the Act, the
beneficial owner of the portion of the shares of
Common Stock held by J&S representing the beneficial
interest of the other limited partner of J&S. See footnote 1
above for information with respect to Sundar
Subramaniam, the other limited partner of J&S.
9. Harrington Trust Limited, as Trustee of the Appleby
Trust ("Harrington"), act solely as trustee.
Harrington disclaims beneficial ownership of the
2,722,123 shares of Common Stock held by The Appleby
Trust. The filing of this Schedule 13D shall not be
construed as an admission that Harrington is, for the
purposes of Sections 13(d) or 13(g) under the Act, the
beneficial owner of 2,722,123 shares of Common Stock
held by Harrington. The beneficiaries of the Trust
(who exercise no voting or investment power over the
shares of Common Stock held by Harrington Trust
Limited, as Trustee of the Trust) are John J. Donovan,
Jr., James H. Donovan, Carolyn S. Donovan, Maureen D.
Lantz and Rebecca M. Donovan.
