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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. _________)*
Advanced Communication Systems, Inc.
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(Name of Issuer)
Common Stock, Par Value $.01 Per Share
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(Title of Class of Securities)
00750X-10-9
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(CUSIP Number)
Nicholas J. Costanza, Esq.
General Counsel
The Titan Corporation
3033 Science Park Road
San Diego, California 92121-1199
(858) 552-9500
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(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
December 9, 1999
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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 Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box / /.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Section 240.13d-7(b)
for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
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SCHEDULE 13D
CUSIP No. 00750X-10-9 Page 2 of 2 Pages
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(1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The Titan Corporation
I.R.S. Identification No. 95-2588754
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) / /
(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
Delaware
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NUMBER OF (7) SOLE VOTING POWER
SHARES 2,120,021(1) (see Item 4)
BENEFICIALLY --------------------------------------------------
OWNED BY (8) SHARED VOTING POWER
EACH 0
REPORTING --------------------------------------------------
PERSON (9) SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------
(10) SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,120,021 (see Item 4)
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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)
24.1%
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(14) TYPE OF REPORTING PERSON*
HC, CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
(1) The reporting person has sole power to vote the shares shown under
irrevocable proxies only with respect to the matters specified in the
irrevocable proxies, as described in Item 4.
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Item 1. Security and Issuer
This statement relates to shares of common stock, par value $.01 per
share (the "ACS Common Stock"), of Advanced Communication Systems, Inc.
("ACS"). The address of ACS's principal executive offices is 10089 Lee
Highway, Fairfax, Virginia 22030.
Item 2. Identity and Background
(a) - (c) and (f). This Schedule 13D is being filed by The Titan
Corporation, a corporation organized and existing under the laws of the State
of Delaware ("Titan"). Titan provides information technology and electronic
systems and services to commercial and government customers. Titan's
principal business and principal offices are located at 3033 Science Park
Road, San Diego, California 92121.
Each executive officer and each director of Titan is a citizen of the
United States. The name, business address and present principal occupation of
each executive officer and director is set forth in Annex A to this Schedule
13D and incorporated herein by reference.
Other than executive officers and directors, there are no persons or
corporations controlling or ultimately in control of Titan.
(d) - (e). During the last five years, neither Titan nor, to the best
knowledge of Titan, any executive officer or director of Titan, has been (i)
convicted in a criminal proceeding (excluding traffic violations and similar
misdemeanors) or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding has been or is 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.
Item 3. Source and Amount of Funds or Other Consideration
Titan has not expended, and does not expect to expend, funds in
connection with its beneficial ownership of ACS Common Stock. Such beneficial
ownership has been derived from the irrevocable proxies described in Item 4,
which have been granted to Titan pursuant to the Company Stockholders
Agreement described in Item 5.
Item 4. Purpose of Transaction
On December 9, 1999, Titan, A T Acquisition Corp. ("Titan Sub") and ACS
entered into an Agreement and Plan of Merger (the "Merger Agreement"), dated
as of December 9, 1999, pursuant to which Titan Sub will be merged with and
into ACS
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(the "Merger"). ACS will be the surviving corporation in the Merger and will
become a wholly-owned subsidiary of Titan.
As a result of the Merger, each outstanding share of ACS Common Stock
(excluding treasury and certain other shares) will be converted into the
right to receive shares of common stock, par value $.01 per share (the "Titan
Common Stock"), of Titan at an exchange ratio based on the market price of
the Titan Common Stock during the period of ten trading days ending two
trading days immediately prior to the consummation of the Merger. The Merger
Agreement is included as Exhibit 1 hereto and is incorporated herein by
reference. Consummation of the Merger would result in the ACS Common Stock
ceasing to be quoted on The Nasdaq National Market and in the termination of
registration of the ACS Common Stock pursuant to the Act.
As a condition and inducement to Titan's entering into the Merger
Agreement, certain stockholders of ACS (the "ACS Stockholders") beneficially
owning a total of 2,120,021 shares of ACS Common Stock (the "ACS Agreement
Shares") as of December 9, 1999 each granted an irrevocable proxy dated as of
December 9, 1999 (such irrevocable proxies collectively, the "Proxy") to
Titan, with power of substitution and resubstitution, to vote the ACS
Agreement Shares and all other shares of ACS capital stock any ACS
Stockholder acquires after December 9, 1999 (the ACS Agreement Shares and all
such other shares collectively, the "Proxy Shares") in favor of the approval
and adoption of the Merger Agreement and the approval of the Merger and the
other transactions contemplated by the Merger Agreement. The Proxy authorizes
Titan to vote the Proxy Shares at any meeting of stockholders of ACS, or in
connection with any solicitation of written consents from stockholders of
ACS, called or solicited for the purpose of voting on the Merger Agreement
and the Merger and the other transactions contemplated by the Merger
Agreement. The Proxy is coupled with an interest and irrevocable. The Proxy
and the rights contained therein will terminate upon the termination of the
Company Stockholders Agreement described in Item 5. The ACS Agreement Shares
represented approximately 24.1% of the ACS Common Stock outstanding as of
December 6, 1999, as represented by ACS in the Merger Agreement. The ACS
Stockholders are (i) George A. and Barbara Robinson, (ii) Charles G.
Martinache and (iii) Thomas A. and Margaret M. Costello. The form of Proxy is
included as Exhibit 2 hereto and is incorporated herein by reference.
Pursuant to the Merger Agreement, the directors and officers of Titan
Sub immediately prior to the consummation of the Merger will be the initial
directors and officers of the wholly-owned subsidiary of Titan that will be
the surviving corporation in the Merger, each to hold office in accordance
with the surviving corporation's certificate of incorporation and bylaws.
The Merger Agreement also provides that the certificate of incorporation and
bylaws of Titan Sub, as in effect immediately prior to consummation of the
Merger, will be the certificate of incorporation and bylaws of such surviving
corporation in the Merger, in each case
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until thereafter amended in accordance with applicable law, except that the
certificate of incorporation of the surviving corporation will be amended to
provide that the name of the surviving corporation will be Advanced
Communications Systems, Inc.
Pursuant to the Merger Agreement, ACS has agreed, during the period
prior to the effective time of the Merger (the "Effective Time"), that
neither it nor its subsidiaries will pay dividends or make other
distributions in respect of their capital stock.
Except as set forth in this Item 4, Titan has no plans or proposals
which relate to or would result in any of the matters set forth in clauses
(a) through (j) of Item 4 of Schedule 13D.
The preceding summary of certain provisions of the Merger Agreement and
the Proxy, copies of which are filed as exhibits hereto, is not intended to
be complete and is qualified in its entirety by reference to the full text of
such agreements.
Item 5. Interest in Securities of the Issuer
(a) and (b). Pursuant to the Proxy described in Item 4, Titan has the
sole power to vote the Proxy Shares only with respect to the matters
specified in the Proxy, as described in Item 4. The Proxy Shares include
2,120,021 shares of ACS Common Stock, which represented approximately 24.1%
of the ACS Common Stock outstanding as of December 6, 1999, as represented by
ACS in the Merger Agreement. Titan does not have shared power to vote or to
direct the vote of the Proxy Shares or the sole or shared power to dispose or
to direct the disposition of the Proxy Shares.
On December 9, 1999, in connection with the execution of the Merger
Agreement, Titan, Titan Sub and the ACS Stockholders entered into a Company
Stockholders Agreement (the "Company Stockholders Agreement"), dated as of
December 9, 1999. Pursuant to the Company Stockholders Agreement, each ACS
Stockholder has agreed to vote, or cause the record holder of the ACS
Agreement Shares to vote, the ACS Agreement Shares beneficially owned by such
ACS Stockholder, and any other voting interests in ACS acquired by such ACS
Stockholder after December 9, 1999, (i) in favor of the approval and adoption
of the Merger Agreement and the approval of the Merger and the other
transactions contemplated by the Merger Agreement in connection with any
meeting of, or solicitation of consents from, stockholders of ACS at which
(or in connection with which) such matters are submitted to a vote of
stockholders of ACS, (ii) against approval or adoption of resolutions which
would have the effect of preventing or materially delaying consummation of
the Merger or ACS from performing its obligations under the Merger Agreement
and (iii) against any other action which would constitute a material breach
of any provision of the Merger Agreement. Pursuant to the Company
Stockholders Agreement, the ACS Stockholders delivered the Proxy to Titan. In
addition, the ACS Stockholders have agreed not to take certain actions until
the Effective Time (or, if earlier terminated, the termination of the Company
Stockholders Agreement) relating to an acquisition proposal for ACS, any
waiver or release of any standstill or similar agreement with respect to any
class of ACS equity securities, any proxies or other voting arrangements with
respect to ACS capital stock or rights to acquire ACS capital stock, or the
transfer or other disposition of any Proxy Shares. The Company Stockholders
Agreement will
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terminate on the earlier to occur of the Effective Time or the date the
Merger Agreement is validly terminated pursuant to the provisions thereof.
The Company Stockholders Agreement is included as Exhibit 3 hereto and
is incorporated herein by reference. The preceding summary of the Company
Stockholders Agreement is qualified in its entirety by reference to the full
text of such agreement.
To the best of its knowledge, no executive officer or director of Titan
beneficially owns any shares of ACS Common Stock.
(c) There have been no transactions in shares of ACS Common Stock by
Titan, or, to the best knowledge of Titan, any of Titan's executive officers
and directors during the past 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Except as set forth in Item 3, 4 or 5, neither Titan nor, to the best
knowledge of Titan, any of its directors or executive officers has any
contracts, arrangements, understandings or relationships (legal or otherwise)
with any other person with respect to any securities of ACS.
Item 7. Materials to be Filed as Exhibits
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
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<C> <S>
1. Agreement and Plan of Merger dated as of December 9, 1999
among The Titan Corporation, A T Acquisition Corp. and
Advanced Communication Systems, Inc. (filed as Exhibit 2.1 to
the Company's Current Report on Form 8-K dated December 16,
1999 and incorporated herein by reference).
2. Form of Irrevocable Proxy by certain stockholders of Advanced
Communication Systems, Inc., included as Exhibit A to the
Company Stockholders Agreement filed herewith as Exhibit 3.
3. Company Stockholders Agreement dated as of December 9, 1999
between certain stockholders party thereto and The Titan
Corporation.
</TABLE>
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SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement is
true, complete and correct.
December 20, 1999
THE TITAN CORPORATION
/s/ Nicholas J. Costanza, Esq.
------------------------------
Nicholas Costanza, Esq.
Secretary and General Counsel
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ANNEX A
Identity and Background
The following table sets forth the names, addresses and principal
occupations of the executive officers and directors of The Titan Corporation
("Titan"). The principal business address of each such director and executive
officer is the address of Titan, 3033 Science Park Road, San Diego,
California 92121-1199. Each of such directors and executive officers is a
citizen of the United States.
DIRECTORS
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
- ------------------------- ------------------------------------------
<S> <C>
Gene W. Ray Chairman of the Board, President & CEO of
Titan
Charles R. Allen Adviser, New Court Partners, a venture
capital unit of Rothschild, Inc.
Joseph F. Caligiuri Retired Executive Vice President of Litton
Industries, Inc., diversified manufacturing
Daniel J. Fink President of D. J. Fink Associates, Inc.,
management consulting
Robert E. La Blanc President of Robert E. La Blanc Associates,
Inc., financial and technical consulting
Thomas G. Pownall Retired Chairman and Chief Executive
Officer of Martin Marietta Corporation
Robert M. Hanisee Managing Director of Trust Company of the
West
James Roth Former President & CEO of GRC
International, Inc.
</TABLE>
A-1
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OFFICERS
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
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<S> <C>
Gene W. Ray Chairman of the Board, President & CEO
Eric M. DeMarco Executive Vice President & CFO &
Treasurer
Mellon C. Baird Senior Vice President
Nicholas J. Costanza Senior Vice President, General Counsel &
Secretary
Ronald B. Gorda Senior Vice President
Gregory F. Szabo Vice President
L.L. Fowler Vice President, Corporate Contracts
Deanna Hom Petersen Vice President & Corporate Controller
Dianne D. Scott Vice President, Human Resources
Laurence J. Oberkfell Senior Vice President
</TABLE>
A-2
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<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
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<C> <S>
1 Agreement and Plan of Merger dated as of December 9, 1999
among The Titan Corporation, A T Acquisition Corp. and
Advanced Communication Systems, Inc. (filed as Exhibit 2.1 to
the Company's Current Report on Form 8-K dated December 16,
1999 and incorporated herein by reference).
2 Form of Irrevocable Proxy by certain stockholders of Advanced
Communication Systems, Inc., included as Exhibit A to the
Company Stockholders Agreement filed herewith as Exhibit 3.
3 Company Stockholders Agreement dated as of December 9, 1999
between certain stockholders party thereto and The Titan
Corporation.
</TABLE>
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Exhibit 3
COMPANY STOCKHOLDERS AGREEMENT
THIS COMPANY STOCKHOLDERS AGREEMENT (this "Agreement") is entered into
this 9th day of December, 1999, by and among The Titan Corporation, a Delaware
corporation ("Acquiror"), A T Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of Acquiror ("Merger Sub"), and each other Person listed
on the signature page hereof who is a stockholder (each a "Stockholder" and
collectively, the "Stockholders") of Advanced Communication Systems, Inc., a
Delaware corporation (the "Company").
WHEREAS, the Stockholders own of record and beneficially the shares of
common stock, par value $.01 per share of the Company ("Company Common Stock")
set forth opposite their respective names on SCHEDULE A hereto (the "Shares")
and desire to enter into this Agreement with respect to such shares of Company
Common Stock;
WHEREAS, Acquiror, Merger Sub and the Company have contemporaneously
with the execution of this Agreement entered into an Agreement and Plan of
Merger (the "Merger Agreement"), dated as of the date hereof, which provides,
among other things, for the merger (the "Merger") of the Merger Sub with and
into the Company pursuant to the terms and conditions thereof; capitalized terms
used herein and not otherwise defined shall have the meanings given to such
terms as in the Merger Agreement;
WHEREAS, as an essential condition and inducement to Acquiror and
Merger Sub entering into the Merger Agreement, Acquiror has required that the
Stockholders agree, and the Stockholders have agreed, to enter into this
Agreement; and
NOW, THEREFORE, the parties hereto, in consideration of the foregoing,
the mutual covenants and agreements contained herein and in the Merger Agreement
and for other good and valuable consideration, the receipt and sufficiency of
which hereby are acknowledged, and intending to be legally bound hereby, agree
as follows:
SECTION 1. VOTING
(a) Each Stockholder hereby agrees to appear, or to cause the holder of
record on any applicable record date (the "Record Holder") to appear, in person
or by proxy, for the purpose of obtaining a quorum at any annual or special
meeting of stockholders of the Company and at any adjournment thereof at which
matters relating to the Merger, Merger Agreement or any transaction contemplated
thereby are considered; and
(b) Each Stockholder further agrees that, it shall vote, or cause the
Record Holder to vote, in person or by proxy all of the Shares, and any other
voting interests in the Company owned or hereafter acquired beneficially or of
record by such Stockholder:
(i) in favor of the Merger and the adoption of the Merger
Agreement and the transactions contemplated thereby (including any amendments or
modifications of the terms thereof approved by the Board of Directors of the
Company and by Acquiror) in
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connection with any meeting of, or solicitation of consents from, the
stockholders of the Company at which or in connection with which the Merger and
the Merger Agreement are submitted for the consideration and vote of the
stockholders of the Company;
(ii) against approval or adoption of resolutions which would
have the effect of preventing or materially delaying consummation of the Merger
or otherwise preventing or materially delaying the Company from performing its
obligations under the Merger Agreement; and
(iii) against any action which would constitute a material
breach of any provision of the Merger Agreement.
To the extent inconsistent with the foregoing provisions of this
Section 1, each Stockholder revokes any and all previous proxies with respect to
Shares owned beneficially or of record by such Stockholder and agrees not to
grant any proxy with respect to and any other voting interests in the Company
owned or hereafter acquired beneficially or of record by such Stockholder.
SECTION 2. PROXY; FURTHER ASSURANCES
(a) Contemporaneously with the execution of this Agreement: (i) each
Stockholder has delivered to Acquiror a proxy in the form attached to this
Agreement as Exhibit A, which shall be coupled with an interest and irrevocable,
with respect to the shares referred to therein (the "Proxy"); and (ii) each
Stockholder has caused to be delivered to Acquiror an additional proxy (in the
form attached hereto as Exhibit A) executed on behalf of the record owner of any
outstanding shares of Company Common Stock that are owned beneficially (within
the meaning of Rule 13d-3 under the Exchange Act), but not of record, by such
Stockholder, which proxy shall be irrevocable to the fullest extent permitted by
law and to the extent provided therein, with respect to the shares referred to
therein.
(b) Each Stockholder shall, at Acquiror's expense, perform such further
acts and execute such further documents and instruments as may reasonably be
required to vest in Acquiror the power to carry out and give effect to the
provisions of this Agreement. Without limiting the generality of the foregoing,
none of the parties hereto shall enter into any agreement or arrangement (or
alter, amend or terminate any existing agreement or arrangement) or transaction
if such action would materially impair or materially interfere with the ability
of any party to effectuate, carry out and comply with all of the terms of this
Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF EACH STOCKHOLDER
Each Stockholder hereby, severally and not jointly, represents and
warrants to Acquiror as follows:
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(a) Such Stockholder has the legal capacity and all other power and
authority necessary to enter into this Agreement, to perform the obligations
hereunder and to consummate the transactions contemplated hereby. This Agreement
has been duly executed and delivered by such Stockholder and, assuming due
authorization, execution and delivery of this Agreement by Acquiror, Merger Sub
and the other parties hereto, constitutes a legal, valid and binding obligation
of such Stockholder, enforceable in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws of general applicability relating to or
affecting creditor's rights generally and by the application of general
principles of equity.
(b) The execution and delivery of this Agreement and the consummation
of the transactions herein contemplated will not to the knowledge of such
Stockholder, (i) conflict with or violate any law, regulation, court order,
judgment or decree applicable to such Stockholder or by which the property of
such Stockholder is bound or affected, or (ii) conflict with or result in any
breach of or constitute a default under any contract or agreement to which such
Stockholder is a party or by which such Stockholder or such Stockholder's
property is bound or affected, which conflict, violation, breach or default
would materially impair or materially interfere with such Stockholder's ability
to perform its obligations under this Agreement.
(c) To the knowledge of such Stockholder, the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby do
not and will not require any consent or other action by any Person under, any
provision of any agreement, contract or other instrument binding on such
Stockholder.
(d) The Shares reflected on SCHEDULE A as being owned by such
Stockholder are the only shares of voting capital stock of the Company or any
other voting interests in the Company owned beneficially or of record by such
Stockholder, and except as set forth in SCHEDULE A, such Stockholder does not
own any other options, warrants or rights to acquire shares of any class of
capital stock of the Company or any other voting interests in the Company. Such
Stockholder has the requisite power respecting voting and transfer of such
Stockholder's Shares. Except as set forth on SCHEDULE 3(d) hereto, the shares
and certificates representing such Shares held by such Stockholder are owned as
indicated on SCHEDULE A by such Stockholder, free and clear of all liens,
claims, security interests, proxies, options, warrants or other rights, voting
trusts or agreements, understandings or arrangements or any other Encumbrances
whatsoever, except for any such Encumbrances or proxies arising hereunder.
(e) No investment banker, broker, finder or other intermediary is
entitled to a fee or commission in respect of this Agreement based upon any
arrangement or agreement made by or on behalf of such Stockholder, except for
fees that may be payable by the Company or Acquiror in conjunction with the
transactions contemplated by the Merger Agreement.
SECTION 4. COVENANTS OF EACH STOCKHOLDER
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(a) From the date of this Agreement until the Effective Time or, if
earlier, the termination of this Agreement pursuant to Section 17 (Termination)
hereof, each Stockholder agrees severally and not jointly that such Stockholder
will not, and will use its "reasonable efforts" to not permit any of the
Representatives of the Company to, directly or indirectly, (i) initiate,
solicit, knowingly facilitate or encourage the submission of an Acquisition
Proposal for the Company; (ii) participate in any discussions or negotiations
regarding, or furnish to any Person any information with respect to, or take any
other action knowingly to facilitate any inquiries or the making of any proposal
that constitutes an Acquisition Proposal for the Company; (iii) grant any waiver
or release under any standstill or similar agreement with respect to any class
of equity securities of the Company; or (iv) enter into any agreement with
respect to any Acquisition Proposal for the Company, other than with Acquiror,
or authorize or permit any of Stockholder's Representatives to take any such
action and, such Stockholder shall promptly notify Acquiror of any such
inquiries and proposals received by such Stockholder or, to such Stockholder's
knowledge, any of such Stockholder's Representatives, relating to any of such
matters. Each Stockholder severally and not jointly further agrees to use its
"reasonable efforts" as a stockholder to cause the Company to comply with the
obligations of the Company set forth in Section 7.8 of the Merger Agreement.
(b) Except pursuant to the terms of this Agreement, each Stockholder
agrees severally and not jointly that such Stockholder will not, without the
prior written consent of Acquiror or Merger Sub, directly or indirectly, grant
any proxies or enter into any voting trust or other agreement or arrangement
with respect to the voting of any capital stock or any options, warrants or
other rights to acquire stock of the Company.
(c) Each Stockholder agrees that, during the period from the date of
this Agreement through the Termination Date, such Stockholder shall not cause or
permit any transfer, assignment, conveyance or other disposition of his Shares,
or any other voting interests in the Company owned or hereafter acquired
beneficially or of record by such Stockholder, unless each Person to which any
Shares or any interest therein is or may be transferred shall have: (i) executed
a counterpart to this Agreement; and (ii) agreed to hold such Shares or any
interest therein subject to the terms and provisions of this Agreement.
SECTION 5 [RESERVED]
SECTION 6. SPECIFIC PERFORMANCE
Each Stockholder acknowledges and agrees that there would be no
adequate remedy at law for Acquiror or Merger Sub if such Stockholder fails to
perform any of such Stockholder's obligations hereunder, and accordingly agrees
that Acquiror and Merger Sub, in addition to any other remedy to which they may
be entitled at law or in equity, shall be entitled to compel specific
performance of the obligations of such Stockholder under this Agreement in
accordance with the terms and conditions of this Agreement in any court of the
United States or any State thereof having jurisdiction.
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SECTION 7. GOVERNING LAW
This Agreement will be governed by and construed in accordance with the
laws of the State of Delaware without regard to principles of conflicts of law.
SECTION 8. PARTIES IN INTEREST
This Agreement shall inure to the benefit of and shall be binding upon
the parties hereto and their respective heirs, legal representatives and
permitted assigns. If any Stockholder shall at any time hereafter acquire
ownership of, or voting power with respect to, any additional shares of capital
stock or any other voting interests in the Company in any manner, whether by the
exercise of any options or any securities or rights convertible into or
exchangeable for shares of capital stock or any other voting interests in the
Company, by operation of law or otherwise, such shares or other interests shall
be held subject to all of the terms and provisions of this Agreement. Without
limiting the foregoing, each Stockholder specifically agrees that the
obligations of such Stockholder hereunder shall not be terminated by operation
of law, whether by death or incapacity of such Stockholder or otherwise.
SECTION 9. AMENDMENT
This Agreement shall not be amended, altered or modified except by an
instrument in writing duly executed and delivered on behalf of each of the
parties hereto.
SECTION 10. SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible to the fullest extent permitted by
applicable law in a mutually acceptable manner in order that the terms of this
Agreement remain as originally contemplated to the fullest extent possible.
SECTION 11. WAIVER
Except as provided in this Agreement, 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 representations, warranties, covenants or agreements
contained in this Agreement. The waiver by any party hereto of a breach of any
provision hereunder shall not operate or be construed as a wavier of any prior
or subsequent breach of the same or any other provision hereunder.
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SECTION 12. NOTICES
All notices and other communications given or made pursuant hereto
shall be in writing and shall be deemed to have been duly given or made as of
the date delivered, mailed or transmitted, and shall be effective upon receipt,
if delivered personally, mailed by registered or certified mail (postage
prepaid, return receipt requested) to the parties at the following addresses (or
at such other address for a party as shall be specified by like changes of
address) or sent by electronic transmission to the telecopier number specified
below:
If to a Stockholder:
To such Stockholder's address
or telecopier number as set forth
on SCHEDULE A attached hereto
with a copy to:
Venable, Baetjer, Howard & Civiletti, LLP
1201 New York Avenue, N.W., Suite 1100
Washington, DC 20005
Telecopier No.: (202) 962-8300
Attention: Wallace E. Christner, Esq.
If to Acquiror or Merger Sub:
The Titan Corporation
3033 Science Park Road
San Diego, CA 92121
Telecopier No.: (619) 552-9759
Attention: Nicholas J. Costanza, Esq., General Counsel
with a copy to:
Hogan & Hartson L.L.P.
8300 Greensboro Drive, Suite 1100
McLean, VA 22102
Telecopier No.: (703) 610-6200
Attention: Richard K.A. Becker, Esq.
SECTION 13. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement among the parties
hereto pertaining to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral or
written, of the parties.
6
<PAGE>
SECTION 14. ASSIGNMENT
The Stockholders may not assign any of their rights or obligations
under this Agreement to any other Person, without the express written consent of
Acquiror. Acquiror may not assign any of its rights or obligations under this
Agreement to any other Person.
SECTION 15. HEADINGS
Section headings are included solely for convenience and are not
considered to be part of this Agreement and are not intended to be an accurate
description of the contents thereof.
SECTION 16. COUNTERPARTS
This Agreement may be executed and delivered in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed and delivered shall be deemed to be an original but all
of which taken together shall constitute one and the same agreement.
SECTION 17. TERMINATION
This Agreement and all of the parties' rights and obligations hereunder
shall terminate on the earlier to occur of (a) the date on which the Merger
Agreement is validly terminated pursuant to the provisions thereof, or (b) the
Effective Time; as defined in the Merger Agreement, (the "Termination Date").
SECTION 18. OFFICERS AND DIRECTORS; AFFILIATE AGREEMENTS
(a) Notwithstanding anything else herein to the contrary but subject to
the proviso set forth in this Section 19(a), (i) nothing set forth herein shall
be deemed to restrict or otherwise prohibit a Stockholder who is an officer or
director of the Company from exercising, in such individual's capacity as an
officer or director of the Company, what such Stockholder believes in good faith
to be his or her fiduciary duties as an officer or director of the Company to
the stockholders of the Company, and (ii) and no action or inaction required
hereby shall require a Stockholder who is an officer or director of the Company
to take any action or refrain from taking any action, in such individual's
capacity as an officer or director of the Company, that such Stockholder
believes in good faith is required by or would be a breach of his or her
fiduciary duties as an officer or director of the Company to the stockholders of
the Company; provided, however, that, notwithstanding the foregoing, with
respect to any matter set forth in Section 7.8 of the Merger Agreement, each
Stockholder who is an officer or director of the Company shall exercise his or
her fiduciary duties to the stockholders of the Company pursuant to and in
accordance with the provisions of Section 7.8 of the Merger Agreement.
(b) Each Stockholder who also executes and enters into an Affiliate
Agreement
7
<PAGE>
hereby agrees and acknowledges that, notwithstanding any other provisions of
this Agreement and in addition to any obligations of such Stockholder hereunder,
such Stockholder is and will be subject to all of the terms and provisions of
such Affiliate Agreement and the obligations of such Stockholder contained in
such Affiliate Agreement are and will be independent, separate and apart from
the obligations of such Stockholder hereunder.
SECTION 19. SURVIVAL
The representations and warranties in this Agreement shall survive the
execution and delivery of this Agreement and expire on the Termination Date;
provided, however, that the covenants and agreements of the parties shall
survive the execution and delivery of this Agreement and terminate on the
earlier to occur of: (i) the Termination Date or (ii) the date on which the
parties' obligations under this Agreement are fully performed.
[The remainder of this page intentionally left blank.]
8
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Company Stockholders Agreement, or have caused this Company Stockholders
Agreement to be executed and delivered on their behalf, as of the date first
above written.
THE TITAN CORPORATION
By: /s/ Gene W. Ray
------------------------------------
Name: Gene W. Ray
Title: Chairman and Chief Executive Officer
A T ACQUISITION CORP.
By: /s/ Gene W. Ray
------------------------------------
Name: Gene W. Ray
Title: Chairman and Chief Executive Officer
STOCKHOLDERS
By: /s/ George A. Robinson
------------------------------------
Name: George A. Robinson
Address: 8237 Taunton Place
Springfield, VA 22152
By: /s/ Barbara Robinson
------------------------------------
Name: Barbara Robinson
Address: 8237 Taunton Place
Springfield, VA 22152
By: /s/ Thomas A. Costello
------------------------------------
Name: Thomas A. Costello
Address: 6293 Columbus Hall Court
McLean, VA 22101
By: /s/ Margaret M. Costello
------------------------------------
Name: Margaret M. Costello
Address: 6293 Columbus Hall Court
McLean, VA 22101
By: /s/ Charles G. Martinache
------------------------------------
Name: Charles G. Martinache
Address: P.O. Box 160
Huger, SC 29450
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<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
STOCKHOLDER NAME AND ADDRESS SHARES OF COMPANY COMMON STOCK
- ---------------------------- ------------------------------
<S> <C>
George A. and Barbara Robinson(1) 847,500
8237 Taunton Place
Springfield, VA 22152
Charles G. Martinache(2) 425,021
P.O. Box 160
Huger, SC 29450
Thomas A. and Margaret M. Costello(3) 847,500
6293 Columbus Hall Court
McLean, VA 22101
</TABLE>
- -------------------------
(1) Includes 333,371 shares owned by the Robinson 1997 Trust No. 1 and 333,371
shares owned by the Robinson 1997 Trust No. 2, both of which George A. Robinson
is the sole trustee, and 180,758 shares owned by George A. Robinson and Barbara
Robinson as joint tenants.
(2) Includes (i) 136,274 shares owned by the Charles G. Martinache Trust No.
1, of which Charles G. Martinache is the sole trustee; and (ii) 3,783 shares
held in trust for the benefit of Andrew Martinache.
(3) Includes: (i) 216,609 shares owned by the Costello 1997 Trust No. 1; (ii)
216,609 shares owned by the Costello 1997 Trust No. 2; (iii) 207,141 shares
owned by Thomas A. Costello Revocable Trust; and (iv) 207,141 shares owned by
Margaret M. Costello Revocable Trust. Margaret M. Costello and Thomas A.
Costello are trustees for the Costello 1997 Trust No. 1 and Costello 1997 Trust
No. 2; Thomas A. Costello is the trustee for the Thomas A. Costello Revocable
Trust; and Margaret M. Costello is the trustee for Margaret M. Costello
Revocable Trust.
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<PAGE>
EXHIBIT A
Form of Irrevocable Proxy
The undersigned Stockholder of Advanced Communication Systems, Inc., a
Delaware corporation (the "Company"), hereby appoints and constitutes The Titan
Corporation, a Delaware corporation ("Acquiror"), the attorneys and proxies of
the undersigned, with full power of substitution and resubstitution, to the full
extent of the undersigned's voting rights with respect to (a) the outstanding
shares of common stock, par value $.01 per share, of the Company (the "Company
Common Stock") or any other capital stock of the Company (collectively with the
Company Common Stock, the "Capital Stock") owned of record by the undersigned as
of the date of this proxy, which shares are specified on the final page of this
proxy, and (b) any and all other shares of Capital Stock of the Company which
the undersigned may acquire on or after the date hereof, provided that this
proxy automatically shall be revoked with respect to any shares of Capital Stock
that are sold, transferred or otherwise disposed of by the undersigned in
accordance with the Company Stockholders Agreement (as hereinafter defined)
("Transferred Stock") effective as of the date of such sale, transfer or other
disposition ("Date of Disposition"). Upon the execution hereof, all prior
proxies given by the undersigned with respect to any of the Capital Stock are
hereby revoked, and the undersigned agrees that no subsequent proxy will be
given with respect to the voting of any of the Capital Stock (other than
Transferred Stock after the Date of Disposition given by the purchaser,
transferee or other beneficiary of such other disposition with respect to such
stock) except to the extent that such proxies do not prevent the voting of this
proxy in favor of the transactions described herein.
This proxy is coupled with an interest and irrevocable. This proxy is
granted (i) in connection with the execution and delivery of the Company
Stockholders Agreement, dated as of the date hereof, among Acquiror and the
undersigned (the "Company Stockholders Agreement") and (ii) in consideration of
Acquiror entering into the Agreement and Plan of Merger, dated as of the date
hereof, among Acquiror, A T Acquisition Corp., a Delaware corporation (the
"Merger Sub") and the Company (the "Merger Agreement").
The proxy named above (and its successors) will, prior to the
Termination Date (as hereinafter defined), be empowered, and may exercise this
proxy, to vote the Capital Stock at any meeting of the Stockholders of the
Company, however called, or in connection with any solicitation of written
consents from Stockholders of the Company, called or solicited, as the case may
be, for the purpose of voting on the Merger Agreement and the transactions
contemplated thereby in favor of the approval and adoption of the Merger
Agreement and the approval of the merger contemplated thereby, and in favor of
each of the other actions contemplated by the Merger Agreement. The undersigned
may vote the Capital Stock on all other matters.
This proxy shall be binding upon the representatives, successors and
permitted assigns of the undersigned.
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<PAGE>
If any provision of this proxy or any part of any such provision is
held under any circumstances to be invalid or unenforceable in any jurisdiction,
then (a) such provision or part thereof shall, with respect to such
circumstances and in such jurisdiction, be deemed amended to conform to
applicable laws so as to be valid and enforceable to the fullest possible
extent, (b) the invalidity or unenforceability of such provision or part thereof
under such circumstances and in such jurisdiction shall not affect the validity
or enforceability of such provision or part thereof under any other
circumstances or in any other jurisdiction, and (c) the invalidity or
unenforceability of such provision or part thereof shall not affect the validity
or enforceability of the remainder of such provision or the validity or
enforceability of any other provision of this proxy. Each provision of this
proxy is separable from every other provision of this proxy, and each part of
each provision of this proxy is separable from every other part of such
provision.
This proxy and the rights contained herein shall terminate upon the
termination of the Company Stockholders Agreement as provided therein (the
"Termination Date").
Date: December 9, 1999
--------------------------------------------
Stockholder's Name
Number of shares of common stock and other
capital stock of the Company owned of record
and beneficially as of the date of this
proxy:
--------------------------------------------
12
