<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------------
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No. 1)(1)
TEKNOWLEDGE CORPORATION
- --------------------------------------------------------------------------------
(Name of issuer)
COMMON STOCK
- --------------------------------------------------------------------------------
(Title of class of securities)
171853 10 4
- --------------------------------------------------------------------------------
(CUSIP number)
B. WADE MONROE, 6034 WEST COURTYARD, SUITE 130, AUSTIN, TEXAS 78730;
512-794-5900
- --------------------------------------------------------------------------------
(Name, address and telephone number of person
authorized to receive notices and communications)
JULY 18, 1995
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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 [ ].
Check the following box if a fee is being paid with the statement [ ].
(A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent of
the class of securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent or less of
such class.) (See Rule 13d-7.)
Note. Six Copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d-1 (a) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 13 Pages)
____________________
(1) 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 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).
<PAGE> 2
CUSIP NO. 171853 10 4 13D PAGE 2 OF 13 PAGES
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1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Trilogy Development Group, Inc.
- --------------------------------------------------------------------------------
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*
WC
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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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7 SOLE VOTING POWER
NUMBER OF 2,853,422
SHARES -------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
-0-
OWNED BY
------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 2,853,422
PERSON ------------------------------------------------
10 SHARED DISPOSITIVE POWER
WITH
-0-
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,853,422
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
/ /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.1%
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14 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 3
CUSIP NO. 171853 10 4 13D PAGE 3 OF 13 PAGES
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Joseph A. Liemandt
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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*
N/A
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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
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES -------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
-0-
OWNED BY
------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON ------------------------------------------------
10 SHARED DISPOSITIVE POWER
WITH
-0-
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0-
- --------------------------------------------------------------------------------
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*
IN
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE> 4
CUSIP No. 171853 10 4 13D Page 4 of 13 Pages
ITEM 1. SECURITY AND ISSUER.
The class of equity securities to which this statement relates is the
common stock, $.01 par value, of Teknowledge Corporation (the "Issuer"). The
address of the principal executive offices of the Issuer is as follows:
Teknowledge Corporation
1810 Embarcadero Road
Palo Alto, California 94303
ITEM 2. IDENTITY AND BACKGROUND.
This statement is filed on behalf of Trilogy Development Group, Inc.
("Trilogy") and Joseph A. Liemandt. In addition, as required by General
Instruction C of Schedule 13D, information is being provided in the responses
to Items 2 through 6 below with respect to each executive officer and director
of Trilogy and each person controlling Trilogy.
A. TRILOGY
Trilogy is a Delaware corporation primarily engaged in the computer
software business. The address of its principal business, which is the same as
the address of its principal office, is as follows:
Trilogy Development Group, Inc.
6034 West Courtyard, Suite 130
Austin, Texas 78730
Trilogy has not been convicted in a criminal proceeding during the
last five years. Trilogy was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which it was 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.
B. EXECUTIVE OFFICERS, DIRECTORS AND CONTROL PERSONS
(i) Dennis R. Cassell. Dennis R. Cassell is Secretary of
Trilogy and is a member of its Board of Directors. His principal occupation is
as a partner with the law firm of Cassell & Stone, L.L.P. His business
address, and the business address of Cassell & Stone, L.L.P., is as follows:
<PAGE> 5
CUSIP No. 171853 10 4 13D Page 5 of 13 Pages
Dennis R. Cassell
Cassell & Stone, L.L.P.
5956 Sherry Lane, Suite 1400
Dallas, Texas 75225
Mr. Cassell has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. Cassell is a United States citizen.
(ii) Charles I. Frumberg. Charles I. Frumberg is a member of
the Board of Directors of Trilogy. His principal occupation is as a principal
of UBS Securities, Inc., an investment firm. His business address, and the
business address of UBS Securities, is as follows:
Charles I. Frumberg
UBS Securities, Inc.
299 Park Avenue
New York, New York 10171-0026
Mr. Frumberg has not been convicted in a criminal proceeding during
the last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. Frumberg is a United States citizen.
(iii) Diane R. Liemandt. Diane R. Liemandt is a member of
the Board of Directors of Trilogy. Her principal occupation is management of
personal investments. Her residence address is as follows:
Diane R. Liemandt
7 Abbotsford Court
Dallas, Texas 75225-1803
Ms. Liemandt has not been convicted in a criminal proceeding during
the last five years. She was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which she was 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. Ms. Liemandt is a United States citizen.
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CUSIP No. 171853 10 4 13D Page 6 of 13 Pages
(iv) Joseph A. Liemandt. Joseph A. Liemandt ("Liemandt") is
President and Chairman of the Board of Directors of Trilogy, which is his
principal occupation. His business address is as follows:
Joseph A. Liemandt
Trilogy Development Group, Inc.
6034 West Courtyard, Suite 130
Austin, Texas 78730
Liemandt has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Liemandt is a United States citizen.
(v) Philip E. London. Philip E. London is the Vice President
of Development for Trilogy, which is his principal occupation. His business
address is as follows:
Philip E. London
Trilogy Development Group, Inc.
6034 West Courtyard, Suite 130
Austin, Texas 78730
Mr. London has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. London is a United States citizen.
(vi) Arthur J. Marks. Arthur J. Marks is a member of the
Board of Directors of Trilogy. His principal occupation is as a principal of
New Enterprise Associates V, Limited Partnership, an investment firm, and
affiliated entities. His business address, and the business address of New
Enterprise Associates V, Limited Partnership, is as follows:
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CUSIP No. 171853 10 4 13D Page 7 of 13 Pages
Arthur J. Marks
New Enterprise Associates V, Limited Partnership
1119 St. Paul Street
Baltimore, Maryland 21202
Mr. Marks has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. Marks is a United States citizen.
(vii) Henry F. McCance. Henry F. McCance is a member of the
Board of Directors of Trilogy. His principal occupation is as a general
partner of Greylock Limited Partnership, an investment firm. His business
address, and the business address of Greylock Limited Partnership, is as
follows:
Henry F. McCance
Greylock Limited Partnership
One Federal Street, 26th Floor
Boston, Massachusetts 02110
Mr. McCance has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. McCance is a United States citizen.
(viii) B. Wade Monroe. B. Wade Monroe is Executive Vice
President and Chief Financial Officer of Trilogy and a member of its Board of
Directors, which is his principal occupation. His business address is as
follows:
B. Wade Monroe
Trilogy Development Group, Inc.
6034 West Courtyard, Suite 130
Austin, Texas 78730
Mr. Monroe has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, Federal or State
<PAGE> 8
CUSIP No. 171853 10 4 13D Page 8 of 13 Pages
securities laws or finding any violation with respect to such laws. Mr. Monroe
is a United States citizen.
(ix) Donald L. Steele. Donald L. Steele is the Vice
President, Sales for Trilogy, which is his principal occupation. His business
address is as follows:
Donald L. Steele
Trilogy Development Group, Inc.
6034 West Courtyard, Suite 130
Austin, Texas 78730
Mr. Steele has not been convicted in a criminal proceeding during the
last five years. He was not a party during the last five years to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which he was 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. Mr. Steele is a United States citizen.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
A. TRILOGY
Trilogy owns 2,853,422 shares (the "Subject Shares") of the common
stock, $.01 par value, of the Issuer. Trilogy acquired 270,000 of the Subject
Shares (the "Liemandt Shares") from Liemandt. Trilogy paid Liemandt an
aggregate of $56,340.70, or approximately $0.209 per share, for the Liemandt
Shares.
Trilogy acquired 1,854,851 of the Subject Shares (the "Ford Shares")
from Ford Motor Company in a negotiated transaction at a purchase price of
$0.125 per share, or an aggregate purchase price of $231,856.38.
Trilogy acquired the remaining 728,571 of the Subject Shares (the "BMW
Shares") and debt of the Issuer in the face amount of $1,000,000 from BMW of
North America, Inc., in a negotiated transaction at aggregate purchase price of
$550,000, including a per-share price of $0.375.
The source of the funds Trilogy used to complete both purchases was
working capital. No funds were borrowed in connection with the purchases.
<PAGE> 9
CUSIP No. 171853 10 4 13D Page 9 of 13 Pages
B. EXECUTIVE OFFICERS, DIRECTORS AND CONTROL PERSONS
(i) Liemandt. Liemandt expressly disclaims beneficial
ownership of the Subject Shares. Accordingly, no shares beneficially owned by
Liemandt are being reported pursuant to this Schedule 13D. Liemandt originally
acquired the Liemandt Shares using personal funds, and did not borrow any funds
in connection therewith.
(ii) Other Executive Officers, Directors and Control Persons.
Not applicable.
ITEM 4. PURPOSE OF TRANSACTION.
A. TRILOGY
Trilogy has acquired the Subject Shares for investment purposes.
Trilogy believes the Subject Shares represent an attractive investment
opportunity at this time. Trilogy may make additional purchases of the
Issuer's common stock, either in the open market or in private transactions,
depending on Trilogy's evaluation of the Issuer's business, prospects and
financial condition, the market for the Issuer's common stock, other
opportunities available to Trilogy, stock market conditions, and other future
developments.
Although the purchase of the Subject Shares by Trilogy has been made
for investment, at some future time Trilogy might decide that it is desirable
to enter into a business transaction with the Issuer or to seek to control or
otherwise influence the management or policies of the Issuer. Management of
Trilogy has made no decision in that regard to date, and has not been
authorized by Trilogy's Board of Directors to enter into a business transaction
with the Issuer or to seek to control or otherwise influence the management or
policies of the Issuer.
Except as set forth in this Item 4, Trilogy has no plans or proposals
that relate to or would result in any of the actions specified in clauses (a)
through (j) of Item 4 of Schedule 13D.
B. EXECUTIVE OFFICERS, DIRECTORS AND CONTROL PERSONS
To the best knowledge of Trilogy, none of its executive officers or
directors has any plans or proposals that relate to or would result in any of
the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D.
<PAGE> 10
CUSIP No. 171853 10 4 13D Page 10 of 13 Pages
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
A. TRILOGY
Trilogy beneficially owns 2,853,422 shares of the common stock of the
Issuer, which are the Subject Shares. Based on information contained in the
most recently available filing by the Issuer with the Securities and Exchange
Commission, such shares constitute approximately 11.1% of the Issuer's
outstanding common stock. Trilogy has the sole power to vote and to dispose of
all of such shares.
Trilogy acquired the Ford Shares in a negotiated transaction that was
agreed to by all parties to the transaction November 7, 1994 and was closed
November 10, 1994. Trilogy acquired the Liemandt Shares in a negotiated
transaction that was agreed to and closed November 10, 1994. Trilogy acquired
the BMW Shares in a negotiated transaction that was agreed to and closed July
18, 1995. See "Item 3. Source and Amount of Funds or Other Consideration" for
a discussion of the amount of securities involved and the purchase price per
share in each such transaction.
B. EXECUTIVE OFFICERS, DIRECTORS AND CONTROL PERSONS
(i) Liemandt. Liemandt sold the Liemandt Shares to Trilogy
in a single transaction on November 10, 1994, and presently has no direct
ownership of, and no power to vote or to direct the vote of or to dispose of or
to direct the disposition of, any securities of the Issuer. He does own a
majority of the outstanding voting securities of Trilogy and thus could be
regarded as an indirect beneficial owner of the Subject Shares. However,
Liemandt expressly disclaims beneficial ownership of any of the Subject Shares.
Moreover, Liemandt expressly declares that the filing of this Schedule 13D
shall not be construed as an admission that he is, for purposes of Section
13(d) of the Exchange Act of 1934, the beneficial owner of any of the Subject
Shares.
(ii) Other Executive Officers, Directors and Control Persons.
Philip E. London is the beneficial owner of 3,000 shares of the common stock,
$.01 par value, of the Issuer. Mr. London has sole power to vote and to
dispose of such shares.
Except as otherwise disclosed herein, to the best knowledge of Trilogy
no shares of common stock of the Issuer are beneficially owned by any of its
executive officers or directors. To the best knowledge of Trilogy, none of its
executive officers or directors have effected any transactions in the common
stock of the Issuer during the past 60 days.
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CUSIP No. 171853 10 4 13D Page 11 of 13 Pages
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
a. Trilogy
Not applicable.
B. EXECUTIVE OFFICERS, DIRECTORS AND CONTROL PERSONS
Not applicable.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit "A" -- Memorandum Regarding Purchase and Sale of the Ford
Shares*
Exhibit "B" -- Agreement Regarding Joint Filing*
Exhibit "C" -- Letter Agreement Regarding Purchase and Sale of the BMW
Shares
Exhibit "D" -- Stock Purchase Agreement and Assignment Regarding
Purchase and Sale of the BMW Shares
Exhibit "E" -- Second Agreement Regarding Joint Filing
______________________________
*Previously Filed
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CUSIP No. 171853 10 4 13D Page 12 of 13 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
July 28, 1995
--------------------------------------
(DATE)
TRILOGY DEVELOPMENT GROUP, INC.
By: /s/ Joseph A. Liemandt
----------------------------------
(SIGNATURE)
Joseph A. Liemandt, President
--------------------------------------
(NAME/TITLE)
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CUSIP No. 171853 10 4 13D Page 13 of 13 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
July 28, 1995
---------------------------------------
(DATE)
/s/ Joseph A. Liemandt
---------------------------------------
(SIGNATURE)
Joseph A. Liemandt, Individually
---------------------------------------
(NAME/TITLE)
<PAGE> 14
EXHIBIT INDEX
Exhibit "A" -- Memorandum Regarding Purchase and Sale of the Ford
Shares*
Exhibit "B" -- Agreement Regarding Joint Filing*
Exhibit "C" -- Letter Agreement Regarding Purchase and Sale of the BMW
Shares
Exhibit "D" -- Stock Purchase Agreement and Assignment Regarding
Purchase and Sale of the BMW Shares
Exhibit "E" -- Second Agreement Regarding Joint Filing
_______________
*Previously Filed
<PAGE> 1
Exhibit "C"
June 30, 1995
Bob Wennemer
BMW Of North America
300 Chestnut Ridge Road
Woodcliffe Lake, NJ 07675
Dear Bob,
As of February 11, 1987, BMW Vision Associates Limited Partnership
("Vision") and American Cimflex Corporation ("ACC") entered into a Technology
Sale and Stock Purchase Agreement whereby Vision sold certain technology to ACC
for a consideration consisting of shares of ACC common stock, par value $.01
per share, plus a specified minimum royalty (the "Agreement"). ACC merged into
Cimflex Teknowledge Corporation ("Teknowledge") effective February 24, 1989.
Teknowledge subsequently shortened its name to Teknowledge Corporation and is
the successor-in-interest to the rights and liabilities of ACC pursuant to the
Agreement. In addition, we understand that BMW is the successor in interest of
Vision and that BMW today owns 728,571 shares of Teknowledge Common Stock.
Trilogy Development Group, Inc. ("Trilogy"), hereby offers to purchase
the rights (excluding the Teknowledge Stock) of BMW under the Agreement and the
728,571 shares of Teknowledge Common Stock currently held by BMW for a
consideration of $550,000 (the "Offer"). BMW evidenced by the signature of its
authorized representative at the end of this letter, hereby accepts the Offer
and agrees to sell all of Vision's rights under the Agreement to Trilogy.
The Offer is subject to the following condition: Legal counsel to
Trilogy must confirm that all royalties due under the Agreement (whether due
prior or subsequent to the date hereof) are legally collectible by Trilogy
after it has assumed the rights of BMW under the Agreement. If the foregoing
condition is not met by the close of business on July 14th, 1995, then the
Offer will be automatically rescinded and neither BMW nor Trilogy will have any
liability hereunder.
This Offer will remain in effect until 11:59 P.M., June 30, 1995.
Sincerely,
TRILOGY DEVELOPMENT GROUP, INC.
By: /s/ Jack F. Lynch
----------------------------
Name: Jack F. Lynch
----------------------------
Title: Controller
----------------------------
Agreed and Accepted this
30 day of June, 1995
BMW
By: /s/ Robert G. Wennemer, /s/ Dennis J. Helfman
---------------------------------------------
Name: Robert G. Wennemer / Dennis J. Helfman
---------------------------------------------
Title: Treasurer / General Counsel & Secretary
--------------------------------------------
<PAGE> 1
Exhibit "D"
STOCK PURCHASE AGREEMENT AND ASSIGNMENT
This Stock Purchase Agreement and Assignment(the "Agreement") is
entered into this 18th day of July, 1995, by and between Trilogy Development
Group, Inc., a Delaware corporation ("Buyer"), and BMW of North America, Inc.,
a Delaware corporation ("Seller").
WHEREAS, Seller desires to sell, and Buyer desires to purchase,
728,571 shares (the "Shares") of the Common Stock ("Common Stock"), par value
$.01 per share, of Teknowledge Corporation, a Delaware corporation (the
"Company"), for the consideration and upon the terms and subject to the
conditions hereinafter set forth;
WHEREAS, Seller desires also to assign to Buyer all of Seller's
rights, excluding all rights pertaining to shares of Common Stock, pursuant to
that certain Technology Sale and Stock Purchase Agreement, dated as of February
11, 1987, by and between BMW Vision Associates Limited Partnership ("Vision")
and American Cimflex Corporation ("ACC") (the "ACC Agreement");
WHEREAS, Seller is the successor-in-interest to Vision under the ACC
Agreement and the Company is by merger the successor-in-interest to ACC under
the ACC Agreement;
WHEREAS, this Agreement is entered into pursuant to the terms of that
certain letter, dated June 30, 1995, from Buyer to Bob Wennemer of BMW of North
America, as agreed and accepted by Seller on June 30, 1995 (the "Letter
Agreement");
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto hereby agree as follows:
1. Purchase and Sale.
1.1 Purchase Price. Upon the terms and subject to the
conditions set forth in this Agreement and upon the representations
and warranties made herein by each of the parties to the other, Seller
hereby sells, grants, conveys, assigns, transfers and delivers to
Buyer, and Buyer hereby purchases and acquires from Seller, (i) the
Shares and (ii) all of Seller's rights and other interests in the ACC
Agreement (including all rights of Seller to receive payments from the
Company, whether such payments are past due, are currently due, or
will become due in the future, and excluding the Common Stock, and all
rights with respect thereto, referenced in the ACC Agreement) at a
price of $550,000 (the "Purchase Price").
1.2 Payment of Purchase Price. Payment of the Purchase
Price has been made by Buyer in cash by wire transfer to an account
designated by Seller, the receipt of which is hereby acknowledged by
Seller.
-1-
<PAGE> 2
1.3 Delivery of Shares. Seller has delivered to Buyer
certificates representing 379,412 of the total number of Shares. Such
certificates have been duly endorsed for transfer or accompanied by
appropriate stock powers (in either case executed in blank or in favor
of Buyer). Delivery of the remaining 349,159 Shares purchased by Buyer
pursuant to this Agreement will be made by Seller delivering to Buyer
certificates representing such remaining Shares, duly endorsed for
transfer or accompanied by appropriate stock powers (in either case
executed in blank or in favor of Buyer). Such remaining Shares shall
be delivered to Buyer as soon as practicable after the date of this
Agreement.
2. Representations and Warranties of Seller.
Seller represents and warrants to Buyer as follows:
2.1 Authorization; Validity and Effect of Agreements.
The execution and delivery of this Agreement and all agreements and
documents contemplated hereby by Seller, and the consummation by it of
the transactions contemplated hereby, have been duly authorized by all
requisite corporate action. This Agreement constitutes, and all
agreements and documents contemplated hereby when executed and
delivered pursuant hereto for value received will constitute, the
valid and legally binding obligations of Seller enforceable in
accordance with their terms, except that enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium, bulk sales, preference, equitable subordination,
marshalling or other similar laws of general application now or
hereafter in effect relating to the enforcement of creditors' rights
generally and except that the remedies of specific performance,
injunction and other forms of equitable relief are subject to certain
tests of equity jurisdiction, equitable defenses and the discretion of
the court before which any proceeding therefor may be brought. The
execution and delivery of this Agreement by Seller does not, and the
consummation by Seller of the transactions contemplated hereby will
not, (i) require the consent, approval or authorization of, or
declaration, filing or registration with (except as to the Shares),
any governmental or regulatory authority; (ii) result in the breach of
any term or provision of, or constitute a default under, or result in
the acceleration of or entitle any party to accelerate (whether after
the giving of notice or the lapse of time or both) any obligation
under, or result in the creation or imposition of any lien, charge,
pledge, security interest or other encumbrance upon any part of the
property of Seller pursuant to any provision of, any order, judgment,
arbitration award, injunction, decree, indenture, mortgage, lease,
license, lien, or other agreement or instrument to which Seller is a
party or by which Seller is bound, specifically excluding the ACC
Agreement; or (iii) violate or conflict with any provision of the
by-laws or charter of Seller as amended to the date of this Agreement.
2.2 Title to Shares. The Shares are duly authorized,
validly issued, fully paid and nonassessable and are owned by Seller
free and clear of all liens, security interests, pledges, charges,
restrictions (other than restrictions under applicable securities laws
and the Company's charter), assessments, adverse claims or other
encumbrances. The Shares are subject to no restrictions (other than
restrictions under applicable securities laws and the
-2-
<PAGE> 3
Company's charter) with respect to transferability to Buyer in
accordance with the terms of this Agreement. Upon delivery of the
Shares, Buyer has received and will receive, as a result, good and
marketable title to all of the Shares, free and clear of all security
interests, liens, charges, assessments, restrictions (other than
restrictions under applicable securities laws and the Company's
charter), adverse claims and other encumbrances of any kind or
character.
2.3 Performance of ACC Agreement. Seller has performed
all of the terms and conditions on its part to be performed under the
ACC Agreement and Seller is not aware of any actions taken by it that
would alter the terms and conditions of the ACC Agreement. Seller has
furnished to Buyer, and Buyer acknowledges receipt of, a copy of a
letter from the Company dated May 19, 1995 (with certain financial
terms expunged), relating to the Company's position with respect to
royalty payments under the ACC Agreement, although Seller makes no
representations as to the accuracy of the dollar amounts contained
therein.
2.4 No Misrepresentation or Omission. No representation
or warranty by Seller in Paragraphs 2.1, 2.2, or 2.3 of this Agreement
contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary to make the
statements contained therein not misleading.
2.5 Limitations. Seller makes this assignment without
recourse and without any warranty of any kind, either express or
implied, as to (a) any of the matters herein contained except as
expressly stated in Paragraphs 2.1. 2.2, and 2.3, (b) the right of
Seller to assign or otherwise convey to Buyer Seller's rights under
the ACC Agreement, or (c) the right of Buyer to collect any sum of
money under the ACC Agreement.
3. Representations and Warranties of Buyer. Buyer represents and
warrants to Seller as follows:
3.1 Authorization; Validity and Effect of Agreements.
The execution and delivery of this Agreement and all agreements and
documents contemplated hereby by Buyer, and the consummation by it of
the transactions contemplated hereby, have been duly authorized by all
requisite corporate action. This Agreement constitutes, and all
agreements and documents contemplated hereby when executed and
delivered pursuant hereto for value received will constitute, the
valid and legally binding obligations of Buyer enforceable in
accordance with their terms, except that enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium, bulk sales, preference, equitable subordination,
marshalling or other similar laws of general application now or
hereafter in effect relating to the enforcement of creditors' rights
generally and except that the remedies of specific performance,
injunction and other forms of equitable relief are subject to certain
tests of equity jurisdiction, equitable defenses and the discretion of
the court before which any proceeding therefor may be brought. The
execution and delivery of this Agreement by Buyer does not, and the
consummation by Buyer of the transactions contemplated hereby will
not, (i) require the consent, approval or authorization of, or
declaration, filing or registration with, any
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governmental or regulatory authority or any third party, (ii) result
in the breach of any term or provision of, or constitute a default
under, or result in the acceleration of or entitle any party to
accelerate (whether after the giving of notice or the lapse of time or
both) any obligation under, or result in the creation or imposition of
any lien, charge, pledge, security interest or other encumbrance upon
any part of the property of Buyer pursuant to any provision of, any
order, judgment, arbitration award, injunction, decree, indenture,
mortgage, lease, license, lien, or other agreement or instrument to
which Buyer is a party or by which it is bound, or (iii) violate or
conflict with any provision of the by-laws or certificate of
incorporation of Buyer as amended to the date of this Agreement.
3.2 Investment Representation. Buyer is acquiring the
Shares for the purpose of investment and not with a view to or for
sale in connection with any distribution thereof. Buyer has no
present intention of making a sale or distribution of the Shares,
unless such sale or distribution is either registered under the
Securities Act of 1933, as amended, or an exemption from such
registration is available.
4. Other Covenants and Agreements.
4.1 Indemnification by Seller. Seller agrees to
indemnify and hold Buyer harmless against, and will reimburse Buyer on
demand for, any payment, loss, cost or expense (including reasonable
attorney's fees and reasonable costs of investigation incurred in
defending against such payment, loss, cost or expense or claim
therefor) made or incurred by or asserted against Buyer at any time
after the date of this Agreement in respect of any and all damage or
deficiency resulting from any inaccuracy, omission, misrepresentation,
breach of any warranty, or nonfulfillment of any term, provision,
covenant or agreement, on the part of Seller contained in this
Agreement. It is hereby acknowledged that the indemnification
provided for in this Paragraph 4.1 does not extend to the terms of the
ACC Agreement.
4.2 Indemnification by Buyer. Buyer agrees to indemnify
and hold Seller harmless against, and will reimburse Seller on demand
for, any payment, loss, cost or expense (including reasonable
attorney's fees and reasonable costs of investigation incurred in
defending against such payment, loss, cost or expense or claim
therefor) made or incurred by or asserted against Seller at any time
after the date of this Agreement in respect of any and all damage or
deficiency resulting from any inaccuracy, omission, misrepresentation,
breach of warranty, or nonfulfillment of any term, provision, covenant
or agreement on the part of Buyer contained in this Agreement, or from
any inaccuracy or misrepresentation in, or omission from, any
certificate or other instrument furnished or to be furnished by Buyer
to Seller pursuant to this Agreement. Buyer further agrees that it
will at all times indemnify and save harmless Seller from all costs
and damages for which Seller might hereafter become liable, or which
Seller might pay resulting from the commencement and prosecution of
any action by or on behalf of Buyer or its successors or assignees, in
Buyer's name or otherwise, or against Buyer or its successors or
assignees, or resulting from any other steps that may be
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<PAGE> 5
taken by or on behalf of Buyer or its successors or assignees to
collect any sum that may be due or become due under the ACC Agreement.
4.3 Expenses. Buyer shall pay all expenses that may be
incurred by Buyer in the collection of any sum due Seller under the
ACC Agreement whether for attorneys' fees, court costs or otherwise,
and Seller shall not be required to pay any of these expenses. Each
party hereto shall be responsible for and shall pay all of its costs,
liabilities and other obligations incurred by it in connection with
the negotiation, preparation and execution of this Agreement,
including legal and accounting fees.
5. Miscellaneous.
5.1 Notice. Any notice, consent, approval, request,
demand or other communication required or permitted hereunder must be
in writing to be effective and shall be deemed delivered and received
(i) if personally delivered or if delivered by telex or telecopy with
electronic confirmation, when actually received by the party to whom
sent, or (ii) if delivered by mail (whether actually received or not),
at the close of business on the third business day next following the
day when placed in the federal mail, postage prepaid, certified or
registered mail, return receipt requested, addressed as follows:
If to Buyer:
Trilogy Development Group, Inc.
6034 West Courtyard Drive
Austin, Texas 78730
Attn: Jack Lynch
If to Seller:
BMW of North America
300 Chestnut Ridge Road
Woodcliffe Lake, NJ 07675
Attn: Bob Wennemer
(or to such other address as any party shall specify by written notice
so given).
5.2 Execution of Additional Documents. The parties
hereto will at any time, and from time to time after the date of this
Agreement, upon request of the other party, execute, acknowledge and
deliver all such further deeds, assignments, transfers, conveyances,
powers of attorney and assurances, and take all such further acts as
may be required to transfer and vest title to any Shares being
transferred hereunder, and to protect the right, title and interest in
and enjoyment of all of the Shares sold, granted, assigned,
transferred, delivered and
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<PAGE> 6
conveyed pursuant to this Agreement; provided, however, that this
Agreement shall be effective regardless of whether any such additional
documents are executed.
5.3 Binding Effect; Benefits. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and
their respective successors and assigns. Notwithstanding anything
contained in this Agreement to the contrary, nothing in this
Agreement, expressed or implied, is intended to confer on any person
(other than the parties hereto or their respective successors and
assigns) any rights, remedies, obligations or liabilities under or by
reason of this Agreement.
5.4 Entire Agreement. This Agreement, together with the
Letter Agreement, constitute the final written expression of all of
the agreements between the parties, and are a complete and exclusive
statement of those terms, and supersede all understandings and
negotiations concerning the matters specified herein. Any
representations, promises, warranties or statements made by either
party that differ in any way from the terms of this written Agreement
and the Letter Agreement, shall be given no force or effect. The
parties specifically represent, each to the other, that there are no
additional or supplemental agreements between them related in any way
to the matters herein contained unless specifically included or
referred to herein. No addition to or modification of any provision
of this Agreement shall be binding upon any party unless made in
writing and signed by all parties.
5.5 Governing Law. THIS AGREEMENT, AND ALL QUESTIONS
RELATING TO ITS VALIDITY, INTERPRETATION, PERFORMANCE AND ENFORCEMENT
(INCLUDING, WITHOUT LIMITATION, PROVISIONS CONCERNING LIMITATIONS OF
ACTION), SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE, NOTWITHSTANDING ANY
CONFLICT-OF-LAW DOCTRINES OF SUCH STATE OR OTHER JURISDICTION TO THE
CONTRARY.
5.6 Survival. All of the terms, conditions, warranties
and representations contained in this Agreement shall survive, in
accordance with their terms, delivery by Buyer of the consideration to
be given by it hereunder and delivery by Seller of the consideration
to be given by it hereunder, and shall survive the execution hereof.
5.7 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original but
all of which shall constitute one and the same instrument; but in
making proof of this Agreement, it shall not be necessary to produce
or account for more than one such counterpart. It is not necessary
that each party hereto execute the same counterpart, so long as
identical counterparts are executed by all parties.
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<PAGE> 7
5.8 Headings. Headings of the Sections of this Agreement
are for the convenience of the parties only, and shall be given no
substantive or interpretive effect whatsoever.
5.9 Waivers. Any party may, by written notice to the
other party hereto, (i) extend the time for the performance of any of
the obligations or other actions of the other under this Agreement;
(ii) waive any inaccuracies in the representations or warranties of
the other contained in this Agreement or in any document delivered
pursuant to this Agreement; (iii) waive compliance with any of the
conditions or covenants of the other contained in this Agreement; or
(iv) waive performance of any of the obligations of the other under
this Agreement. Except as provided in the preceding sentence, 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 waiver of
any prior or subsequent breach of the same or any other provision
hereunder.
5.10 Severability. If for any reason whatsoever, any one
or more of the provisions of this Agreement shall be held or deemed to
be illegal, inoperative, unenforceable, void, voidable or otherwise
invalid as applied to any particular case or in all cases, such
circumstances shall not have the effect of rendering such provision
invalid in any other case or of rendering any of the other provisions
of this Agreement illegal, inoperative, unenforceable, void, voidable
or otherwise invalid. Furthermore, in lieu of each such illegal,
invalid, unenforceable, void, voidable or inoperative provision, there
shall be added automatically, as part of this Agreement, a provision
similar in terms of such illegal, invalid, unenforceable, void,
voidable or inoperative provision as may be possible and as shall be
legal, valid, enforceable and operative.
* * * * * *
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IN WITNESS WHEREOF, the parties have executed this Agreement and
caused the same to be duly delivered on their behalf as of the day and year
hereinabove first set forth.
<TABLE>
<S> <C>
TRILOGY DEVELOPMENT GROUP, INC.
By: /s/ Jack F. Lynch
---------------------------------------------
Printed Name: Jack Lynch
--------------------------------------
Title: Controller
---------------------------------------------
BMW OF NORTH AMERICA, INC.
By: /s/ Robert G. Wennemer, /s/ Dennis J. Helfman
---------------------------------------------
Robert G. Wennemer/
Printed Name: Dennis J. Helfman
---------------------------------------------
Treasurer/
Title: General Counsel & Secretary
---------------------------------------------
</TABLE>
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<PAGE> 1
Exhibit "E"
SECOND AGREEMENT REGARDING JOINT FILING
This Second Agreement Regarding Joint Filing evidences the agreement
of Trilogy Development Group, Inc., a Delaware corporation ("Trilogy"), and
Joseph A. Liemandt, an individual, to the joint filing with the Securities and
Exchange Commission of a Schedule 13D/A, Amendment No. 1, on behalf of each of
them on or about July 28, 1995, relating to the acquisition by Trilogy of
beneficial ownership of certain securities issued by Teknowledge Corporation.
In witness whereof, the parties hereto have executed this Agreement as
of the 28th day of July, 1995.
TRILOGY DEVELOPMENT GROUP, INC.
By: /s/ Joseph A. Liemandt
------------------------------
Joseph A. Liemandt, President
/s/ Joseph A. Liemandt
--------------------------------------
Joseph A. Liemandt, Individually
