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EXHIBIT 10.12
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REPURCHASE AGREEMENT
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This Agreement is made and entered into this 11th day of March, 1999 by
and between Convergent Networks, Inc., a Delaware corporation with its principal
place of business in Tewksbury, Massachusetts (the "Company"), and Sally Bament
("Participant").
WITNESSETH:
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WHEREAS, Company has granted to Participant an option to purchase shares
of the Company's common stock, par value $.00001 per share, (the "Shares")
pursuant to the Company's 1998 Stock Option Plan (the "Plan");
WHEREAS, the Plan provides that the Committee may accelerate the vesting
of any option granted pursuant to the plan, provided that the Participant enter
into a Stock Repurchase Agreement pursuant to which the Company may repurchase
the Shares according to a Reverse Vesting Schedule in substance similar to that
underlying the option; and
WHEREAS, the Committee has approved the immediate vesting of the Shares
upon and subject to the Participant's execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein, the parties hereto hereby agree as follows:
1. The Vesting Reference Date shall be February 17, 1999. In the event
Participant's involvement with Company terminates for any reason whatsoever,
whether due to voluntary or involuntary action, death, disability or otherwise,
within five (5) years after the Vesting Reference Date, Company shall have the
right to repurchase all or a portion of the Shares in accordance with the
following:
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Prior to the first anniversary date of the Vesting Reference Date (the
"First Anniversary Date") one hundred percent (100%) of the Shares are subject
to repurchase. On the First Anniversary Date, twenty percent (20%) of the
Shares subject to repurchase hereunder shall vest (i.e. shall no longer be
subject to repurchase) ("Vest") such that eighty percent (80%) of the Shares are
subject to repurchase. Thereafter additional Shares shall Vest on a quarterly
basis such that each quarter after the First Anniversary five percent (5%) of
said Shares shall Vest and the number of Shares subject to repurchase shall
decrease by like amount (5%) on a per quarter basis.
2. In the event the Company desires to exercise such repurchase rights, the
Company shall do so by furnishing all notices required by Section 3.2 of a
certain Escrow Agreement dated among the Company, Hutchins, Wheeler & Dittmar, A
Professional Corporation and a series of individuals who purchased the Company's
common stock pursuant to the Plan or under the Company's 1998 Restricted Stock
Purchase Plan (the "Escrow Agreement").
3. The purchase price for any repurchase by the Company hereunder shall be
that percentage of the aggregate Exercise Price paid for the Shares which equals
the percentage of the Shares which have not Vested as of the date of such
repurchase.
4. Upon the Company's receipt of the materials under the Escrow Agreement
required to effect a repurchase, the Company shall pay Participant the purchase
price determined pursuant to Paragraph 3 hereof.
5. Certificates representing the Shares shall bear a legend that the shares
represented thereby may not be sold, exchanged, transferred, pledged,
hypothecated or otherwise disposed of
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except in accordance with the terms of this Agreement and the transfer agent for
the common stock of the Corporation shall be so instructed. Participant shall
deposit such certificates together with a stock power or other instrument of
transfer, appropriately endorsed in blank with signatures witnessed, with the
escrow agent under the Escrow Agreement pursuant to which the Shares will be
held in escrow until a repurchase occurs under Section 2 or until such
repurchase rights shall have lapsed. Participant hereby irrevocably constitutes
and appoints the Secretary of the Company as his or her attorney to transfer
Shares on the books of the Company in connection with any repurchase. During the
period while the Shares are held in escrow, the Participant shall be entitled to
receive all dividends declared thereon.
6. In the event of a Change of Control (as defined in the Plan) of the
Company, the Participant will automatically receive eighteen (18) months
accelerated vesting. Any remaining unvested Shares shall continue to vest at a
quarterly rate of 5% of the Shares originally issued.
7. In the event of any ambiguity or inconsistency between the provisions of
this Agreement and those of the Plan, the provisions of this Agreement shall
govern and be controlling.
8. All notices given hereunder shall be in writing and sent by certified
mail, return receipt requested, addressed as follows, provided that a party may
change its notice address by notice thereof:
If to Company: Convergent Networks, Inc.
2 Highwood Drive
Tewksbury, MA 01876
Attn: President
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If to Participant: To the address set forth below the Participant's
signature on the signature page hereto.
9. This Agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Massachusetts.
10. This Agreement constitutes the entire agreement between the parties
concerning its subject matter and supersedes any prior or contemporaneous
agreements and understandings in connection therewith. This Agreement may be
amended, waived or revoked only by a written instrument executed by both
parties.
11. Capitalized terms used herein but not otherwise defined herein shall
have those meanings ascribed to them in the Plan.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement under
seal in duplicate originals as of the date first written above.
CONVERGENT NETWORKS, INC. PARTICIPANT
By: /s/ Bing Yang By: /s/ Sally Bament
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Name: Bing Yang Name: Sally J. Bament
Title: President Address: 336 Boston Road
North Andover, MA 01845
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