SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
Date of Report: (Date of earliest event reported):
April 11, 2000 (April 6, 2000)
Allstar Systems, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-21479
(State of Incorporation) (Commission File Number)
76-0515249
(IRS Employer Identification No.)
6401 Southwest Freeway
Houston, Texas 77074
(Address of Registrant's principal executive offices)
(713) 795-2000
(Registrant's telephone number, including area code)
(Not Applicable)
(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS
On April 7, 2000, Allstar Systems, Inc. (the "Company") issued a press
release announcing that on April 6, 2000 it had entered into an amendment (the
"APA Amendment") of the previously announced Asset Purchase Agreement, dated as
of March 16, 2000 (the "Purchase Agreement"), with Amherst Computer Products
Southwest, LP, a Texas limited partnership ("Amherst"), and Amherst
Technologies, L.L.C., a Nevada limited liability company ("AmTech"), relating to
the sale of certain assets and the ongoing business of its Computer Products
Division. Pursuant to the APA Amendment, in addition to the purchase price
provided in the Purchase Agreement, Amherst paid to the Company $250,000 as a
non-accountable expense reimbursement. In addition, pursuant to an Escrow
Agreement among the Company, Amherst and Compass Bank (the "Escrow Agreement"),
Amherst placed $500,000 in an escrow account to be applied to the purchase price
at closing of the transaction. If the transaction does not close, the Company
will receive all of the escrowed funds, unless the failure to close is due to a
breach by the Company of certain of its representations or obligations in the
Purchase Agreement or certain of the conditions to Amherst's obligations to
close in the Purchase Agreement not being satisfied, in which event, Amherst
will receive all of the escrowed funds; and provided that if the transaction
does not close because litigation is pending or threatened that prevents
consummation of the transaction or that could cause the transaction to be
rescinded once closed, the escrowed funds will be split equally between the
Company and Amherst.
In connection with the execution of the APA Amendment, James H. Long
entered into an amendment (the "VSA Amendment") of his Voting and Support
Agreement with Amherst. Pursuant to the VSA Amendment, Mr. Long agreed
unconditionally to vote his shares of common stock of the Company, representing
approximately 50.1% of the outstanding common stock of the Company, in favor of
approval and adoption of the Purchase Agreement and against any other
transaction involving the Computer Products Division. Mr. Long also executed a
proxy (the "Proxy") granting two designees of Amherst the right to vote his
shares in favor of the Purchase Agreement and against any other transaction
involving the Computer Products Division.
The APA Amendment, VSA Amendment, Escrow Agreement, Proxy and press
release are filed as exhibits hereto and are incorporated by reference. The
descriptions of the APA Amendment, VSA Amendment, Escrow Agreement and Proxy set
forth above do not purport to be complete and are qualified in their entirety by
reference to the provisions of such agreements.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(c) Exhibits
2.1 Amendment No. 1 to Asset Purchase Agreement, dated as of
April 6, 2000, by and among Amherst Computer Products Southwest, LP, Amherst
Technologies, L.L.C. and the Company.
99.1 Amendment No. 1 to Voting and Support Agreement, dated as of
April 6, 2000, by and between Amherst Computer Products Southwest, LP and James
H. Long.
99.2 Escrow Agreement, dated April 6, 2000, among the Company,
Amherst Computer Products Southwest, LP and Compass Bank.
99.3 Irrevocable Proxy and Limited Power of Attorney, dated April
6, 2000, executed by James H. Long.
99.4 Text of Press Release, dated April 7, 2000.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: April 11, 2000
ALLSTAR SYSTEMS, INC.
By: /s/ Donald R. Chadwick
Donald R. Chadwick
Secretary
<PAGE>
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION OF EXHIBIT
2.1 Amendment No. 1 to Asset Purchase Agreement, dated as of April 6,
2000, by and among Amherst Computer Products Southwest, LP,
Amherst Technologies, L.L.C. and the Company.
99.1 Amendment No. 1 to Voting and Support Agreement, dated as of
April 6, 2000, by and between Amherst Computer Products
Southwest, LP and James H. Long.
99.2 Escrow Agreement, dated April 6, 2000, among the Company, Amherst
Computer Products Southwest, LP and Compass Bank.
99.3 Irrevocable Proxy and Limited Power of Attorney, dated April 6,
2000, executed by James H. Long.
99.4 Text of Press Release, dated April 7, 2000.
AMENDMENT NO. 1 TO
ASSET PURCHASE AGREEMENT
This Amendment to Asset Purchase Agreement (the "Amendment"), dated as
of April 6, 2000, is entered into by and among Amherst Computer Products
Southwest, LP, a Texas limited partnership ("Amherst Southwest"), Amherst
Technologies, L.L.C., a Nevada limited liability company ("AmTech"), and Allstar
Systems, Inc., a Delaware corporation ("Allstar").
BACKGROUND:
A. Amherst Southwest, AmTech and Allstar have heretofore entered into
that certain Asset Purchase Agreement, dated as of March 16, 2000 (the "Asset
Purchase Agreement"). All capitalized terms used and not otherwise defined
herein shall have the meanings ascribed to them in the Asset Purchase Agreement.
B. The parties desire to make certain amendments to the Asset Purchase
Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, Amherst Southwest, AmTech and Allstar agree as follows.
AGREEMENTS
1. Status of the Asset Purchase Agreement. Except as specifically set
forth herein, the Asset Purchase Agreement shall remain in full force and effect
and shall not be waived, modified, superseded or otherwise affected by this
Amendment. This Amendment is not to be construed as a release, waiver or
modification of the terms, conditions, representations, warranties, covenants,
rights or remedies set forth in the Asset Purchase Agreement, except as
specifically set forth herein.
2. Amendments to the Asset Purchase Agreement.
(i) The following provision shall be added as Section 2.14 of the
agreement:
"2.14 Pre-Closing Escrow; Expense Reimbursement.
(a) On or before April 10, 2000, Amherst Southwest
shall wire transfer $500,000 into an escrow account with the
Escrow Agent to be established by the parties, such funds
(together with interest or income earned thereon) to be
applied against the Purchase Price upon Closing; provided
however, if the Closing of the transactions contemplated by
the Asset Purchase Agreement does not occur by June 30, 2000,
then the parties shall cause the $500,000 escrow amount
(together with interest or income earned thereon) to be paid
on or before July 5, 2000, as follows:
(1) If the Closing does not occur
solely because of the breach by Allstar of its
representations or obligations in, or a failure of
the conditions under, the following sections of the
Agreement, the funds in
<PAGE>
escrow shall be paid to Amherst Southwest: Sections
4.1, 4.2, 4.4, 4.8, 6.3, 7.1(f), 7.1(k), 7.1(l),
7.1(m), and 9.1(a).
(2) If the Closing does not occur
solely because of the failure of the condition of
Section 7.1(d) of the Agreement, the funds in escrow
shall be split evenly between and paid to Amherst
Southwest and Allstar.
(3) If the Closing does not occur
for any reason other than one which expressly
entitles Amherst Southwest to receive all or a
portion of the escrow funds under paragraphs 1 or 2
above, the escrow funds shall be paid to Allstar. The
form of Escrow Agreement shall be in substantially
the form of Exhibit A and attached to the Asset
Purchase Agreement as Exhibit G.
(b) On or before April 10, 2000, Amherst Southwest
agrees to pay to Allstar by wire transfer the sum of $250,000
in addition to the Purchase Price as a non-accountable expense
reimbursement."
(ii) Section 9.2 of the Agreement is hereby deleted
in its entirety and replaced with the following:
"9.2 Termination Fee. In the event that this
Agreement is terminated by Amherst Southwest pursuant
to Section 9.1(b)(3) or by Allstar pursuant to
Section 9.1(c)(3), Allstar shall within 2 Business
Days after such termination pay or cause to be paid
to Amherst Southwest, as compensation for lost
opportunities and reimbursement of out-of-pocket
expenses: (i) Five Hundred Thousand Dollars
($500,000), (ii) the amount of the escrow funds
(together with interest or income earned thereon)
under that certain Escrow Agreement dated as of April
6, 2000 among Allstar, Amherst Southwest and the
Escrow Agent thereunder, (iii) the amount of $250,000
previously paid by Amherst Southwest to Allstar
pursuant to Section 2.14(b), as a non-accountable
expense reimbursement, and Allstar shall assume and
Amherst Southwest shall assign to Allstar all rights
and obligations of Amherst Southwest under (1) the
Lease between Amherst Southwest and Weingarten Realty
Advisors for the premises located at 11727 W. Sam
Houston Parkway South, Suite D, Houston, Texas 77031,
and (2) Section 3 of the Voting Agreement, as
amended. AmTech and Amherst Southwest agree that upon
such payments to Amherst Southwest and the assumption
of such obligations by Allstar, Allstar shall have no
further liability to either of them arising under
this Agreement."
3. Effectiveness of this Amendment. The effectiveness of this Amendment
is contingent upon the execution of Amendment No. 1 to the Voting and Support
Agreement dated as of April 6, 2000 by and among Amherst Southwest and James H.
Long (the "Voting Agreement Amendment").
4. Representations and Warranties of Entities. Each of Amherst Southwest,
AmTech and Allstar represents and warrants that its execution, delivery and
performance of this Amendment has been duly authorized by all necessary
corporate and partnership action and that this Amendment is a legal, valid and
binding obligation of the parties in accordance with its terms. Allstar further
represents and warrants that its board of directors has approved the Voting and
Support Agreement dated as of March 16, 2000 between Amherst Southwest, and
James H. Long, and the Voting Agreement Amendment, in a manner sufficient to
make the restrictions contained in Section 203 of the Delaware General
Corporation Law inapplicable to the transactions contemplated by the Asset
Purchase Agreement, as amended.
5. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.
6. Governing Law. This Amendment shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
date first above written.
AMHERST COMPUTER PRODUCTS SOUTHWEST, LP
By: /s/ Gerald Birin
Title: CFO
ALLSTAR SYSTEMS, INC.
By: /s/ James H. Long
Title: James H. Long,
Chief Executive Officer
AMHERST TECHNOLOGIES, L.L.C.
By: /s/ Gerald Birin
Title: CFO
AMENDMENT NO. 1
TO
VOTING AND SUPPORT AGREEMENT
This Amendment to Voting and Support Agreement (the "Amendment") dated
as of April 6, 2000 is entered into between Amherst Computer Products Southwest,
LP, a Texas limited partnership ("Amherst Southwest"), and James H. Long
("Long").
BACKGROUND
A. Amherst Southwest and Allstar Systems, Inc., a Delaware corporation
("Allstar"), have entered into an Asset Purchase Agreement dated as of March 16,
2000, as amended (the "Asset Purchase Agreement"), and Amherst Southwest and
Long have previously entered into a Voting and Support Agreement dated as of
March 16, 2000 (the "Voting Agreement"). Capitalized terms not otherwise defined
herein shall have the meanings assigned to them in the Asset Purchase Agreement.
B. Amherst and Long desire to make certain amendments to the Voting
Agreement to provide for Long, in addition to voting all of the Majority Shares
in favor of the Asset Purchase Agreement and the transactions contemplated
thereby, to (i) vote all of his Majority Shares against any other Acquisition
Proposal or any other sale or exchange of assets, lease transaction, merger,
consolidation, other business combination, or corporate reorganization, other
than that contemplated by the Asset Purchase Agreement, and to (ii) execute an
irrevocable proxy whereby he appoints Amherst Southwest's designees as attorneys
and proxies, with full power of substitution, to vote on behalf of Long, the
Majority Shares of which Long may be entitled to vote in favor of the
transactions contemplated by the Asset Purchase Agreement and to vote on behalf
of Long, the Majority Shares of which Long may be entitled to vote, against any
other Acquisition Proposal, whether solicited or unsolicited.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, Amherst Southwest and Long agree as follows.
AGREEMENTS
1. Status of the Voting Agreement. Except as specifically set forth
herein, the Voting Agreement shall remain in full force and effect and shall not
be waived, modified, superseded or otherwise affected by this Amendment. This
Amendment is not to be construed as a release, waiver or modification of the
terms, conditions, representations, warranties, covenants, rights or remedies
set forth in the Voting Agreement, except as specifically set forth herein.
2. Amendment to the Voting Agreement.
(a) Section 2(a) of the Voting Agreement is hereby deleted in
its entirety and replaced by the following:
<PAGE>
"(a) Majority Approval. Long agrees to vote all of the
Majority Shares in favor of the Asset Purchase Agreement and the
transactions contemplated thereby, and agrees to vote all of the
Majority Shares against any other Acquisition Proposal, whether
solicited or unsolicited. In addition, immediately upon execution
of this Agreement, Long further agrees to execute an irrevocable
proxy in the form attached as Exhibit A."
(b) Section 3 of the Voting Agreement is hereby renumbered to
become Section 4, and all terms previously stated therein shall remain in full
force and effect, and a new Section 3 of the Voting Agreement is hereby
inserted, which shall read as follows:
"3. Indemnification. Amherst Southwest agrees to
indemnify Long for one-half of any costs incurred in defense of
any lawsuit filed against Long complaining of Long's execution of
the proxy provided for under Section 2(a) of the Voting
Agreement, but in no event shall Amherst Southwest be required to
pay more than $100,000 in the aggregate pursuant to this
indemnification provision."
(c) The prior Section 4 of the Voting Agreement is hereby
renumbered to become Section 5, and all terms previously stated therein shall
remain in full force and effect unless amended hereby.
(d) Exhibit A attached to this Amendment shall be attached as
Exhibit A to the Voting Agreement.
3. Effectiveness of this Amendment. The effectiveness of this
Amendment is contingent upon the execution of Amendment No. 1 to Asset Purchase
Agreement dated as of April 6, 2000 by and among Amherst Southwest, Amherst
Technologies, L.L.C., a Nevada limited liability company ("AmTech"), and
Allstar. This Amendment shall automatically terminate if the escrow payment or
the expense reimbursement therein required is not timely made by Amherst
Southwest.
4. Representations and Warranties of Entities. Each of Amherst
Southwest and Long represents and warrants that its execution, delivery and
performance of this Amendment is duly authorized and that this Amendment is a
legal, valid and binding obligation of such party in accordance with its terms.
Long further represents and warrants that sufficient approval of the board of
directors of Allstar had been obtained for the Voting and Support Agreement
dated as of March 16, 2000 between Amherst Southwest, and James H. Long, and
this Amendment, in a manner sufficient to make the restrictions contained in
Section 203 of the Delaware General Corporation Law inapplicable to the
transactions contemplated by the Asset Purchase Agreement, as amended.
5. Counterparts. This Amendment may be executed in counterparts,
each of which shall be deemed an original and both of which together shall
constitute one and the same instrument.
6. Governing Law. This Amendment shall be governed by and construed
in accordance with the domestic laws of the State of Delaware without giving
effect to any choice or conflict of law provision or rule (whether of the State
of Delaware or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Delaware.
7. Further Assurances. Long agrees to take all action and execute
any documents in his capacity as a stockholder of Allstar consistent with a
request by the Company to its stockholders generally to approve the Asset
Purchase Agreement, including execution of a ballot card.
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of
the date first above written.
AMHERST COMPUTER PRODUCTS SOUTHWEST, LP
By: /s/ James H. Long By: /s/ Gerald Birin
James H. Long Gerald Birin, Chief Financial Officer
ESCROW AGREEMENT
This Agreement is entered into as of this 6th day of April, 2000, by
and among Amherst Computer Products Southwest, LP, a Texas limited partnership
("Amherst Southwest"), Allstar Systems, Inc., a Delaware corporation
("Allstar"), and Compass Bank, a bank organized under the laws of the State of
Alabama, as escrow agent (the "Escrow Agent").
RECITALS
A. Pursuant to that certain Asset Purchase Agreement (the "Purchase
Agreement") dated as of March 16, 2000, among Amherst Southwest, Allstar and
Amherst Technologies, L.L.C., as amended by Amendment No. 1 to Asset Purchase
Agreement, Amherst Southwest is acquiring certain assets of Allstar's CP
Division and El Paso IT Business. Capitalized terms used in this Agreement,
unless otherwise defined, shall have the meanings ascribed to them in the
Purchase Agreement.
B. The execution and delivery of this Escrow Agreement is required by
Amendment No. 1 to Asset Purchase Agreement, which requires Amherst Southwest to
deposit the sum of Five Hundred Thousand Dollars ($500,000) (the "Escrow Fund")
with the Escrow Agent pursuant to the terms of the Purchase Agreement and this
Escrow Agreement.
NOW THEREFORE, in consideration of the promises and covenants set forth
below, the parties hereto agree as follows:
1. Appointment; Delivery of Escrow Fund at Closing. Upon the terms and
subject to the conditions of this Escrow Agreement and the Voting Agreement,
Amherst Southwest and Allstar hereby appoint the Escrow Agent to act as escrow
agent with respect to the Escrow Fund (which shall include any earnings
thereon), and the Escrow Agent hereby accepts such appointment and agrees to
hold and deliver the Escrow Fund in accordance with the terms and provisions
hereof. The Escrow Fund shall be held by the Escrow Agent in a separate account
for the benefit of Amherst Southwest and Allstar as provided in this Escrow
Agreement.
2. Disbursement of Escrow Fund. The Escrow Agent shall disburse the Escrow
Fund in accordance with (1) the joint written instructions of Allstar and
Amherst Southwest, or (2) the terms of any arbitration or Court order obtained
pursuant to Section 3 hereof. Allstar and Amherst Southwest acknowledge their
respective obligations to provide joint written instructions for the
disbursement of the Escrow Fund pursuant to the terms of the Purchase Agreement.
<PAGE>
3. Resolution of Disputed Claims.
(a) All disputes arising out of or relating to (i) this Agreement or any
notice or instrument delivered pursuant to the terms hereof, or the transactions
contemplated hereby, or (ii) the validity, interpretation, breach, or violation
or termination hereof (including disputes arising under this Section 3 (each a
"Dispute"), shall be finally and solely determined and settled by a nationally
recognized certified public accounting firm selected by mutual agreement of the
Parties, which firm is not rendering (and during the preceding two-year period,
has not rendered) services to any of the parties or their respective Affiliates
(the "Arbitrating Accountant"). In connection with the resolution of any Dispute
hereunder, the Arbitrating Accountant shall have access to all documents,
records, work papers, facilities and personnel necessary to perform its function
as arbitrator. The award of the Arbitrating Accountant shall be (1) the sole and
exclusive remedy of the parties, (2) enforceable in any court of competent
jurisdiction and (3) final and binding (absent manifest error) on the parties
hereto. Amherst Southwest, on the one hand, and Allstar, on the other hand,
shall each pay one-half of the fees and expenses of the Arbitrating Accountant
with respect to any Dispute.
(b) In the event that Allstar and Amherst Southwest are unable to mutually
agree on the Arbitrating Accountant within thirty (30) days, the Dispute shall
be finally and solely determined and settled by arbitration in Houston, Texas in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association and this Section 3. Such arbitration shall be conducted by a single
arbitrator, whom Allstar and Amherst Southwest shall request to be experienced
in legal, financial and accounting matters. In any such arbitration proceedings,
the arbitrator shall adopt and apply the provisions of the Federal Rules of
Civil Procedure relating to discovery so that each party shall allow and may
obtain discovery of any matter not privileged which is relevant to the subject
matter involved in the arbitration to the same extent as if such arbitration
were a civil action pending in a United States District Court for the Southern
District of Texas. The arbitrator may proceed to an award notwithstanding the
failure of any party to participate in such proceedings. The prevailing party in
the arbitration proceeding shall be entitled to an award of reasonable
attorneys' fees incurred in connection with the arbitration in such amount as
may be determined by the arbitrator. The award of the arbitrator shall be (i)
the sole and exclusive remedy of the parties, (ii) enforceable in any court of
competent jurisdiction and (iii) final and binding (absent manifest error) on
the parties hereto.
4. Inspection of Escrow Records. At any time during the Escrow Agent's regular
business hours, Amherst Southwest or Allstar may inspect the Escrow Agent's
records insofar as they relate to the Escrow Fund, to determine whether the
Escrow Agent is complying with the provisions of this Escrow Agreement. Within
30 days of the end of each calendar quarter during the period in which the
Escrow Fund is held by Escrow Agent, the Escrow Agent shall send quarterly
statements to Amherst Southwest and Allstar detailing any earnings on the Escrow
Fund for such calendar quarter and for all periods since the deposit of the
Escrow Fund with the Escrow Agent.
5. Investment of Escrow Fund. The Escrow Agent shall invest and reinvest the
Escrow Fund and any earnings thereon in the Expedition Investor Services Shares,
unless otherwise instructed in writing by Amherst Southwest and Allstar.
6. Resignation of Escrow Agent. Notwithstanding any other provisions of this
Escrow Agreement, the Escrow Agent may resign as Escrow Agent at any time by
notifying the parties hereto, and until a successor escrow agent is appointed by
Amherst Southwest and Allstar and accepts such appointment, the Escrow Agent's
only duty shall be to hold the funds in accordance with the terms of this
Agreement. If an instrument of acceptance by a successor escrow agent shall not
have been delivered to the Escrow Agent within thirty (30) days after the giving
of such notice of resignation, the Escrow Agent may, notwithstanding the
provisions of Section 3, and at the expense of Amherst Southwest and Allstar,
petition any court of competent jurisdiction for the appointment of a successor
escrow agent.
7. Liability of Escrow Agent; Advice of Counsel; Indemnification.
(a) The Escrow Agent shall be obligated to perform only the duties
described in this Escrow Agreement. The Escrow Agent may rely on any instrument
or signature believed by it to be genuine and to have been signed or presented
by the proper party or parties duly authorized to do so. The Escrow Agent shall
not be liable for any action taken or omitted by it in good faith and believed
by it to be authorized, nor for any action taken or omitted by it in accordance
with advice of counsel, and shall not be liable for any mistake of fact or error
of judgment or for any acts or omissions of any kind unless caused by its
willful misconduct or gross negligence.
(b) The Escrow Agent shall be entitled to consult with competent and
responsible counsel of its choice with respect to the interpretation of the
provisions hereof, and any other legal matters relating thereto, and be fully
protected in taking any action or omitting to take any action in good faith in
accordance with the advice of such counsel.
(c) Amherst Southwest and Allstar agree to hold the Escrow Agent harmless
and indemnify the Escrow Agent against any loss, liability, expense (including
reasonable attorneys' fees and expenses), claim or demand arising out of or in
connection with the performance of its obligations in accordance with the
provisions of this Agreement, except for gross negligence or willful misconduct
of the Escrow Agent. The foregoing indemnities in this Section 7 shall survive
the resignation of the Escrow Agent or the termination of this Escrow Agreement.
8. Escrow Agent's Fee. The Escrow Agent shall be entitled to compensation for
its services at an annual fee equal to $5000.00, payable as mutually agreed by
the parties. The fee agreed upon for services rendered hereunder is intended as
full compensation for the Escrow Agent's services as contemplated by this Escrow
Agreement and shall be borne equally by Allstar and Amherst Southwest. Should
litigation or arbitral proceedings be instituted by or against any of the
parties hereto requiring additional duties of the Escrow Agent, or appearance in
court or before an arbitrator, the Escrow Agent shall be reimbursed in equal
shares by Allstar and Amherst Southwest for its services and for its reasonable
expenses incurred therein.
9. Notices. All notices, requests, demands, claims, and other communications
hereunder will be in writing. Any notice, request, demand, claim, or other
communication hereunder shall be deemed duly given if (and then two Business
Days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
If to Allstar:
Allstar Systems, Inc.
6401 Southwest Freeway
Houston, TX 77074
Attention: James H. Long
Facsimile: 713-795-2204
With a copy to:
Porter & Hedges, L.L.P.
700 Louisiana, Suite 3500
Houston, Texas 77002
Attention: Nick D. Nicholas
Facsimile: 713-228-1331
If to Amherst Southwest:
Amherst Computer Products Southwest, LP
10 Columbia Drive
Amherst, NH 03031
Attention: Chief Financial Officer
Facsimile: 603-578-0061
With a copy to:
Suzanne L. Saxman
D'Ancona & Pflaum LLC
111 E. Wacker Drive,
Suite 2800
Chicago, IL 60601
Facsimile: 312-602-3064
If to the Escrow Agent:
Compass Bank
2001 Kirby Drive
Houston, Texas 77019
Attention: Tom Collins
Facsimile: (713) 831-5746
Any Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, ordinary mail, or electronic mail), but no such notice, request,
demand, claim, or other communication shall be deemed to have been duly given
unless and until it actually is received by the intended recipient. Any Party
may change the address to which notices, request, demands, claims, and other
communications hereunder are to be delivered by the other Parties notice in the
manner herein set forth.
10. Termination. The Escrow Agent's duties pursuant to this Escrow Agreement
shall be terminated upon the full and final release of the Escrow Fund and all
earnings thereon in accordance with the provisions of this Escrow Agreement, and
thereupon this Escrow Agreement shall expire and be of no further force or
effect (except to the extent any provisions hereof expressly survive such
termination).
11. Modifications and Waivers. Any change, amendment, supplement, modification
or waiver of any provision of this Escrow Agreement shall be valid and binding
only if it is in writing and signed by the parties hereto. No waiver of any
breach, term or condition of this Escrow Agreement by any party shall constitute
a subsequent waiver of the same or any other breach, term or condition.
12. Payments. All disbursements made by the Escrow Agent pursuant to this
Escrow Agreement shall be made by wire transfer of immediately available funds
to accounts designated in writing by the party entitled to such funds.
13. Counterparts. This Escrow Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
14. Severability. If any provisions of this Escrow Agreement or the application
of such provision to any person or circumstance shall be held invalid by a court
or arbitrator of competent jurisdiction, then the remainder of this Escrow
Agreement, or the application of such provision to persons or circumstances
other than those to which it is held invalid by such court or arbitrator, shall
not be affected thereby so long as the parties' manifest intent under this
Escrow Agreement is not defeated.
15. Governing Law; Binding Effect. This Escrow Agreement shall be interpreted,
and the rights and liabilities of the parties hereto determined, in accordance
with the laws of the State of Delaware without regard to conflicts of law
principles. This Escrow Agreement shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns.
16. Waiver of Offset Rights. The Escrow Agent hereby waives any and all rights
to offset that it may have against the Escrow Fund including, without
limitation, claims arising as a result of any claims, amounts, liabilities,
costs, expenses, damage or other losses that the Escrow Agent may be otherwise
entitled to collect from any party to this Escrow Agreement.
17. Time is of the Essence. Time is of the essence in the performance of this
Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Escrow Agreement as
of the date first written above.
AMHERST COMPUTER PRODUCTS ALLSTAR SYSTEMS, INC.
SOUTHWEST, LP
By: /s/ Gerald Birin By: /s/ James H. Long
Its: CFO Its: President/CEO
COMPASS BANK
By: /s/ G. Tom Collins
Its: Vice President
IRREVOCABLE PROXY AND LIMITED POWER OF ATTORNEY
The undersigned stockholder of Allstar Systems, Inc., a Delaware
corporation (the "Company"), hereby irrevocably appoints each of Ronald Dupler
and Gerald Birin attorneys and proxies of the undersigned, with full power of
substitution, to vote on behalf of the undersigned all of the shares of common
stock of the Company ("Company Common Stock") which the undersigned may be
entitled to vote on the matters set forth below:
1. To approve the Asset Purchase Agreement dated as of March 16, 2000, as
amended, among the Company, Amherst Computer Products Southwest, LP
("Amherst Southwest") and Amherst Technologies, L.L.C. (the
"Agreement"), pursuant to which the Company will sell certain assets,
as set forth in the Agreement, to Amherst Southwest.
2. To take any action to oppose any Acquisition Proposal as such term is
defined in the Agreement, other than the Agreement.
This Irrevocable Proxy and Limited Power of Attorney is valid and binding
and is expressly stated and deemed to be coupled with an interest and shall be
irrevocable for a period of eighteen (18) months from the date hereof, but shall
automatically terminate upon the first to occur of (i) the Closing (as defined
in the Agreement) of the transactions contemplated by the Agreement, or (ii)
termination of the Agreement, except for a termination by the Company pursuant
to Section 9.1(c)(3) of the Agreement or a termination by Amherst Southwest
pursuant to Section 9.1(b)(3) of the Agreement. This Irrevocable Proxy and
Limited Power of Attorney shall survive the death or disability of the
undersigned and shall be binding on any successor in interest to the shares of
the Company Common Stock owned by the undersigned. This Irrevocable Proxy and
Limited Power of Attorney shall operate to revoke any prior proxy as to the
securities heretofore granted by the undersigned with respect to the matters
described herein.
This Irrevocable Proxy and Limited Power of Attorney shall be governed by
the laws of the State of Delaware. To the extent (if any) the undersigned would
retain under law, regardless of the foregoing authorization and appointment, any
residual rights inconsistent with the foregoing irrevocable authorization and
appointment, the undersigned hereby specifically and expressly (i) waives such
rights, (ii) agrees never to exercise such rights and (iii) agrees never to
claim, as a complaint or a defense, or otherwise assert that such authorization
and appointment are not valid or enforceable. The invalidity or unenforceability
of any provision of this Irrevocable Proxy and Limited Power of Attorney shall
not effect the validity or enforceability of any other provision. To the extent
(if any) any provision hereof is deemed invalid or unenforceable by its scope
but may be made valid or enforceable by limitations thereon, the undersigned
agrees that this Irrevocable Proxy and Limited Power of Attorney, shall be valid
and enforceable to the fullest extent permitted by law.
Signature: /s/ James H. Long
James H. Long
Dated: April 6, 2000
FOR IMMEDIATE RELEASE
ALLSTAR SYSTEMS ANNOUNCES AMENDMENT OF AGREEMENT TO SELL ITS COMPUTER PRODUCTS
DIVISION
HOUSTON, April 7, 2000/PR Newswire/-Allstar Systems, Inc.(Nasdaq: ALLS),
announced today that it reached agreement with Amherst Technologies, L.L.C. to
amend the previously announced Asset Purchase Agreement among Allstar Systems,
Amherst and Amherst Computer Products Southwest, LP relating to the sale of
certain assets and the ongoing operations of its Computer Products Division.
Pursuant to the amendment, in addition to the purchase price provided in
the Asset Purchase Agreement, Amherst paid to Allstar Systems $250,000 as a
non-accountable expense reimbursement. In addition, Amherst placed $500,000 in
an escrow account to be applied to the purchase price at closing of the
transaction.
Additionally, James H. Long amended the Voting and Support Agreement
previously executed by him in connection with the transaction. The amendment
unconditionally requires him to vote all of his shares of stock in Allstar
Systems in favor of the transaction and against any other transaction. Mr. Long
also executed a proxy granting to designees of Amherst the right to vote his
shares for the transaction and against any other transaction.
The statements contained in this document that are not historical facts,
including but not limited to, statements identified by the use of words such as
"anticipate," "appear," "believe," "could," "estimate," "expect," "hope,"
"indicate," "intend," "likely," "may," "might," "plan," "potential," "seek,"
"should," "will," "would," and any other variations or negative expressions of
these terms, are "forward-looking statements" within the meaning of the Private
Securities Litigation Reformed Act of 1995 and involve a number of risks and
uncertainties. The actual results of the future events described in the
forward-looking statements in this document could differ materially from those
stated in the forward-looking statements due to numerous factors, including the
risks and uncertainties set forth from time to time in Allstar Systems public
reports and filings and other public statements. Recipients of this document are
cautioned to consider these risks and uncertainties and not place undue reliance
on these forward-looking statements.
For additional information contact: James H. Long, President and Chief
Executive Officer, (713) 795-2301.
