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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: May 15, 1996
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(Date of earliest event reported)
Data National Corporation
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(Exact Name of Registrant as Specified in its Charter
Colorado 0-14204 84-0958983
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(State of (Commission (I.R.S. Employer
Incorporation) File No.) Identification No.)
11415 West I-70 Frontage Road North, Wheat Ridge, CO 80033
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(Address and Zip Code of Principal Executive Offices)
Registrant's telephone number including area code: (303) 431-1933
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ITEM 5. OTHER EVENTS.
On May 15, 1996, the Registrant entered into separate Stock Purchase and
Stock Restriction Agreements with each of Donald V. Warriner, the Chief
Executive Officer of the Company ("Warriner"), and J. Scott Fowler, the
Vice-President of the Company ("Fowler"), pursuant to which the Registrant
sold 150,000,000 shares of its common stock to Warriner and 52,000,000 to
Fowler, all at a purchase price of $0.0006 per share. As the result of
these transactions, the amount of the Registrant's currently issued and
outstanding shares has increased from 327,478,340 to 529,478,340, with
Warriner currently owning 28.36% and Fowler owning 9.83%, respectively.
Payment for 25% of the shares issued to both individuals was in the form of
services rendered to the Registrant in the past, and payment for the remaining
75% was in the form of an offset against $67,500 in debt owed by the Registrant
to Warriner, and $23,400 in debt owed by the Company to Fowler. The Registrant
owed these amounts to Messrs. Warriner and Fowler, respectively, as the result
of respective assignments by Ray E. Dillon, II and Ray E. Dillon, III (the
"Dillons") to Warriner and Fowler of identical portions of the indebtedness
owed by the Registrant to the Dillons. The amount that was previously owed
by the Registrant to the Dillons has been reduced by $90,900 on the books and
records of the Registrant as the result of these transactions from
approximately $870,000 to approximately $779,100.
All of the shares issued to Warriner and Fowler are subject to certain
restrictions set forth in the subject Stock Purchase and Stock Restriction
Agreements, and may be subject to forfeiture under certain circumstances.
The shares may not be sold, transferred, assigned, pledged, encumbered, or
otherwise alienated or hypothecated except pursuant to the terms of the
respective subject agreements.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
10.1 Stock Purchase and Restriction Agreement entered into as of May 15,
1996 by and between Data National Corporation and Donald V. Warriner.
10.2 Stock Purchase and Restriction Agreement entered into as of May 15,
1996 by and between Data National Corporation and J. Scott Fowler.
2
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
(Registrant) DATA NATIONAL CORPORATION
BY (Signature) /s/ Richard Simms
(Date) May 31, 1996
(Name and Title) Richard Simms, Chief Financial Officer
3
(5-15-96.8-k)
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Exhibit 10.1
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STOCK PURCHASE AND RESTRICTION AGREEMENT
THIS STOCK PURCHASE AND RESTRICTION AGREEMENT (the "Agreement") is made
and entered into as of the 15th day of May, 1996, by and between DATA NATIONAL
CORPORATION, a Colorado corporation ("DNC"), and Donald V. Warriner,
("Employee").
RECITALS
WHEREAS, DNC desires to sell 112,500,000 shares of its common stock (the
"Shares") to Employee, who is an executive of DNC, for the purposes of
establishing incentives designed to recognize, reward, and retain Employee
whose performance, contribution, and skills are important to DNC, and to
promote the increased ownership of common stock of DNC by Employee in order
to increase the proprietary interest of Employee in DNC's business; and
WHEREAS, Employee desires to purchase the Shares from DNC subject to the
terms and conditions of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the Recitals, the mutual covenants and
promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:
1. PURCHASE AND SALE OF SHARES.
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1.1 Purchase and Sale. DNC hereby sells and Employee hereby
purchases, the Shares, subject to the terms, conditions, and restrictions
contained herein.
1.2 Purchase Price. The purchase price for the Shares shall be
$.0006 per Share, for a cumulative purchase price of $ 67,500.00.
2. ISSUANCE OF STOCK CERTIFICATES AND EXECUTION OF STOCK TRANSFERS.
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2.1 Issuance of Stock Certificates. Promptly upon payment by Employee
of the purchase price described above in subsection 1.2 and execution of the
three stock transfers described below in subsection 2.2, DNC shall issue three
certificates to Employee, each certificate representing ownership of one-third
of the Shares. Upon issuance of such stock certificates and subject to the
restrictions on transfer and ownership of the Shares contained herein,
Employee shall have all rights of a stockholder of DNC with respect to the
Shares including the right to vote the Shares and receive all dividends and
other distributions paid or made with respect thereto. DNC shall hold the
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stock certificates evidencing ownership of the Shares until such time as the
restrictions described below in paragraph 3.1.1 have lapsed. Upon the lapse
of such restrictions, DNC shall issue to Employee a stock certificate
evidencing those Shares for which the restrictions have lapsed.
2.2 Execution of Stock Transfers. Employee agrees to execute and deliver
to DNC three stock transfers, each stock transfer being applicable to one-
third of the Shares, with a notation on each stock transfer that DNC is
appointed as attorney in fact for Employee to transfer the Shares described
on the stock transfer upon payment of the purchase price for the restricted
Shares in accordance with the terms and conditions of this Agreement. DNC
shall hold the executed stock transfers with the stock certificates
representing the Shares, and shall only take action with respect to the stock
transfers in accordance with the terms of this Agreement.
3. RESTRICTIONS ON TRANSFER OF SHARES.
-----------------------------------
3.1 Restrictions Relating to Securities Laws and This Agreement.
Employee acknowledges that the Shares are being sold pursuant to one or more
exemptions from registration under federal and applicable state securities
laws. These exemptions and the terms of this Agreement require that certain
restrictions be placed on the transfer of the Shares.
3.1.1 Employee shall not offer, sell, transfer, assign, market, pledge,
encumber, or otherwise alienate or hypothecate the Shares until such time as
the restrictions imposed pursuant to this Agreement have lapsed in accordance
with subsection 4.1.
3.1.2 Following the lapse of the restrictions contained in this
Agreement, Employee may offer, sell, transfer, assign, or otherwise market
the Shares only if (i) Employee registers the Shares under the Securities Act
of 1933 and applicable state securities laws, or (ii) Employee provides to the
Corporation an opinion of counsel satisfactory to the Corporation that such
offer, sale, transfer, assignment, or other marketing of the Shares is exempt
from the registration requirements of the Securities Act of 1933 and
applicable state securities laws and that registration is not required under
such Act and such state securities laws, and the purchaser, transferee, or
assignee agrees to execute a Subscription Agreement with Corporation
agreeing to the same restrictions on transfer contained in this Agreement
which are related to federal and state securities laws.
3.2 Stock Legends. The stock certificates evidencing the Shares shall
be issued in the sole name of Employee (but shall be held by DNC until the
restrictions described above in paragraph 3.1.1 shall have lapsed in
accordance with the terms and conditions of this Agreement) and shall bear
two restrictive legends which shall provide:
3.2.1 "THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER STATE
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SECURITIES LAWS. IT HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED, ASSIGNED, OR OTHERWISE MARKETED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THIS SECURITY UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL SATISFACTORY
TO THE CORPORATION THAT SUCH OFFER, SALE, TRANSFER, ASSIGNMENT, OR OTHER
MARKETING IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH
STATE SECURITIES LAWS AND THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
AND SUCH STATE SECURITIES LAWS."
3.2.2 "The securities represented by this certificate are subject to the
terms and restrictions contained in a Stock Purchase and Restriction Agreement
between the holder of the certificate and the Corporation dated May 15, 1996;
such shares are subject to forfeiture or cancellation under the terms of said
Agreement; and the securities cannot be sold, transferred, assigned, pledged,
encumbered, or otherwise alienated or hypothecated except pursuant to the
terms of said Agreement."
3.2.3 The legend described above in paragraph 3.2.1 will remain on any
certificate evidencing ownership of the Shares continuously and any purchaser,
transferee, or assignee of the Shares will be subject to these same
restrictions on transferability of the Shares.
4. LAPSE OF RESTRICTIONS.
----------------------
4.1 Lapse of Contractual Restrictions. The restrictions in paragraph
3.1.1 shall lapse as follows:
4.1.1 Said restrictions shall lapse with respect to one-third of the
Shares each August 1 during each of the three consecutive calendar years
beginning on August 1, 1996, but only if on the date the restrictions are to
lapse Employee has been an employee of DNC continuously from the Effective
Date to such date of lapse. Temporary leaves of absence which are approved by
the Board of Directors of DNC shall not be considered a break in Employee's
continuous employment with DNC. If calculation of one-third of the Shares
would result in a fractional share interest, the number of Shares shall be
rounded down to the next lowest number of full shares for each of the first
two lapse dates, with the balance to the third lapse date.
4.1.2 Notwithstanding paragraph 4.1.1, said restrictions shall lapse
with respect to all of the Shares which remain restricted upon the sale of
all or substantially all of the assets of DNC.
4.1.3 Notwithstanding paragraph 4.1.1, said restrictions shall lapse
with respect to all of the Shares which remain restricted in the event the
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Board of Directors of DNC decides, in its sole and exclusive judgment, that
the restrictions shall lapse because of (i) a significant corporate event,
e.g., a merger, consolidation, change of control of the ownership of the
majority of the stock of DNC, or other significant events as determined
by the Board of Directors of DNC, or (ii) in the event of Employee's death,
permanent total disability, or retirement.
4.2 Lapse of Securities Restrictions. The restrictions in paragraph 3.1.2
shall not lapse.
5. TERMINATION OF EMPLOYMENT AND RESALE OF SHARES TO CORPORATION.
5.1 Requirement to Sell Restricted Shares Upon Termination of
Employment. In the event of the termination of Employee's employment with
DNC, all Shares still subject to the restrictions imposed by paragraph 3.1.1
shall be sold by Employee to DNC at the purchase price described in
subsection 1.2.
5.2 Procedure to Sell Restricted Shares to Corporation. Upon the
termination of Employee's employment with DNC as described above in
subsection 5.1, DNC shall purchase the Shares obligated to be sold to DNC by
tendering payment of the purchase price to Employee within thirty days of
Employee's termination of employment with DNC. In the event that DNC does
not have sufficient funds to purchase the restricted Shares, it may, at its
option, elect to purchase the shares by making a promissory note in favor
of Employee pursuant to which the purchase price shall be paid in five equal
annual installments bearing interest at 10%. Immediately following payment
of the purchase price, whether paid by cash or promissory note, DNC may
present the applicable stock transfers to its transfer agent or appropriate
officer and have the restricted Shares transferred to DNC.
6. SECURITIES MATTERS. Employee hereby makes the following
representations and warranties upon which DNC may rely in connection with the
purchase and sale of the Shares:
6.1 Employee's offer to purchase is based upon information known to
Employee as an executive employee of DNC and on Employee's own independent
evaluation, which may include the counsel of Employee's own advisers;
6.2 Employee has reviewed the financial statements and records of DNC,
and at a reasonable time prior to purchase of the Shares has been afforded an
opportunity to request information from and pose questions to the officers of
DNC with respect to the terms and conditions of the purchase and sale of the
Shares to obtain any additional information necessary to verify the accuracy
of the financial statements and other information concerning DNC, and
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DNC has responded to all questions or inquiries to the satisfaction of
employee;
6.3 Employee understands that the transferability of the Shares is
restricted and that Employee cannot be expected to be able to readily
liquidate Employee's investment in DNC in case of an emergency;
6.4 Employee is purchasing the Shares for investment purposes and
Employee's own account, and has no present intention of distributing or
reselling the same. Employee acknowledges that Employee's State of residence
may impose restrictions on the right to transfer the Shares and that there are
restrictions on transfer under the Federal securities laws;
6.5 Employee is of legal age in accordance with laws of Employee's
State of residence; and
6.6 Employee, together with Employee's own advisers, including but not
limited to any designated purchaser representative, with whom he has consulted
in connection with his decision to purchase the Shares has sufficient
knowledge and experience in financial and business matters so as to enable
Employee to evaluate the merits and risks of the proposed investment.
7. NO IMPACT ON TERMS OF EMPLOYMENT. This Agreement shall have no
impact on the terms and conditions of Employee's employment with DNC, and
Employee shall remain an "at will" employee of DNC, meaning that Employee has
a right to terminate his employment relationship with DNC without notice at
any time and for any reason, and DNC has an identical right. Thus, this
Agreement shall not be evidence of any agreement or understanding, express or
implied, that DNC will employ Employee in any particular position, at any
particular rate of compensation, or for any particular period of time,
until such time as both parties agree to modify or change the terms of
employment.
8. MISCELLANEOUS.
8.1 Waiver. The failure to demand strict performance of one or more of
the terms, covenants, or conditions set forth herein shall not be construed as
a continuing waiver or relinquishment thereof and any party may at any time
demand strict and complete performance of said terms, covenants, and
conditions.
8.2 Construction and Interpretation of Terms. The titles used in this
Agreement are for convenience only and shall not affect the meaning of the
terms and provisions of this Agreement. Any words herein used in the singular
shall denote the plural as the context so requires and, when used herein in
the plural, shall denote the singular as the context so requires. Pronouns
used herein, whether masculine, feminine, or neuter, shall be interpreted as
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the context so requires. The language of all parts of this Agreement shall
in all cases be construed as a whole, according to its fair meaning, and not
strictly for or against any party. No presumptions or rules of interpretation
based upon the identity of the party preparing or drafting the Agreement, or
any part thereof, shall be applicable or invoked.
8.3 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective
successors and permitted assigns. Neither party may assign either this
Agreement or any of its rights, interests, or obligations hereunder without
the prior written approval of the other. For purposes of this Agreement,
Data National Corporation, as referred to herein as "DNC," shall include any
subsidiary of DNC and any successor in interest to DNC by way of merger,
consolidation, or operation of law.
8.4 Divisibility. In the event a court of competent jurisdiction
determines any provision of this Agreement to be void or unenforceable, the
remaining provisions shall remain in full force and effect.
8.5 Modification. No modification of this Agreement shall be valid or
binding upon the parties or entitled to any enforcement whatsoever unless such
modification is reduced to writing and signed and dated by both parties.
8.6 Notices. Any notice required or permitted to be given hereunder
shall be hand delivered; sent by prepaid certified mail, return receipt
requested; or sent by reputable overnight courier such as Federal Express,
and shall be deemed to have been given when hand delivered, three business
days after deposit in the U.S. mail, or one business day after timely deposit
with an overnight courier, as the case may be. All notices shall be sent or
delivered to the respective address specified on the signatory page of
the Agreement, except that either party, upon notice to the other party as
provided for herein, may change the address to which further notices shall
be sent.
8.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original, and all of which shall
constitute one and the same instrument.
8.8 Specific Performance. If any party to this Agreement fails to
perform any act required by the terms of this Agreement, then, in addition to
all other remedies available at law, the other party may institute and
maintain a proceeding to compel the specific performance of this Agreement by
the defaulting party.
8.9 Attorneys' Fees. If any party must resort to legal assistance to
enforce any of the terms or provisions of this Agreement, then, in addition
to any damages, injunction or other relief, all reasonable expenses of the
prevailing party, including but not limited to attorneys' fees, shall be
recoverable as costs.
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8.10 Documents and Instruments. The parties agree that they will
execute any and all documents and instruments necessary to effectuate and
carry out the terms and intent of this Agreement. If any party fails to
execute and deliver any such instrument, this Agreement shall constitute an
actual grant, assignment, and conveyance of the property and rights associated
therewith in such manner and with such force and effect as shall be necessary
to effectuate the terms and intent of this Agreement.
8.11 Entire Agreement. This Agreement contains the entire agreement
between the parties and supersedes all prior agreements, representations,
negotiations, statements, or proposals related to those matters set forth
herein.
8.12 Applicable Law. This Agreement shall be construed, interpreted, and
governed in accordance with the laws of the State of Colorado.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
EMPLOYEE: DATA NATIONAL CORPORATION:
BY (Signature) /s/ Donald V. Warriner BY (Signature) /s/ Richard S. Simms
(Printed Name) Donald V. Warriner Richard S. Simms
Vice President
(Address) 4 Glenview Dr.
Littleton, Co. 80123 Data National Corporation
11415 West I-70 Frontage
Road-North
Wheat Ridge, CO 80033
4143-2:16955
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Exhibit 10.2
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STOCK PURCHASE AND RESTRICTION AGREEMENT
THIS STOCK PURCHASE AND RESTRICTION AGREEMENT (the "Agreement") is made
and entered into as of the 15th day of May, 1996, by and between DATA NATIONAL
CORPORATION, a Colorado corporation ("DNC"), and J. Scott Fowler,
("Employee").
RECITALS
WHEREAS, DNC desires to sell 39,000,000 shares of its common stock (the
"Shares") to Employee, who is an executive of DNC, for the purposes of
establishing incentives designed to recognize, reward, and retain Employee
whose performance, contribution, and skills are important to DNC, and to
promote the increased ownership of common stock of DNC by Employee in order
to increase the proprietary interest of Employee in DNC's business; and
WHEREAS, Employee desires to purchase the Shares from DNC subject to the
terms and conditions of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the Recitals, the mutual covenants and
promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:
1. PURCHASE AND SALE OF SHARES.
----------------------------
1.1 Purchase and Sale. DNC hereby sells and Employee hereby
purchases, the Shares, subject to the terms, conditions, and restrictions
contained herein.
1.2 Purchase Price. The purchase price for the Shares shall be
$.0006 per Share, for a cumulative purchase price of $ 23,400.00.
2. ISSUANCE OF STOCK CERTIFICATES AND EXECUTION OF STOCK TRANSFERS.
----------------------------------------------------------------
2.1 Issuance of Stock Certificates. Promptly upon payment by Employee
of the purchase price described above in subsection 1.2 and execution of the
three stock transfers described below in subsection 2.2, DNC shall issue three
certificates to Employee, each certificate representing ownership of one-third
of the Shares. Upon issuance of such stock certificates and subject to the
restrictions on transfer and ownership of the Shares contained herein,
Employee shall have all rights of a stockholder of DNC with respect to the
Shares including the right to vote the Shares and receive all dividends and
other distributions paid or made with respect thereto. DNC shall hold the
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stock certificates evidencing ownership of the Shares until such time as the
restrictions described below in paragraph 3.1.1 have lapsed. Upon the lapse
of such restrictions, DNC shall issue to Employee a stock certificate
evidencing those Shares for which the restrictions have lapsed.
2.2 Execution of Stock Transfers. Employee agrees to execute and deliver
to DNC three stock transfers, each stock transfer being applicable to one-
third of the Shares, with a notation on each stock transfer that DNC is
appointed as attorney in fact for Employee to transfer the Shares described
on the stock transfer upon payment of the purchase price for the restricted
Shares in accordance with the terms and conditions of this Agreement. DNC
shall hold the executed stock transfers with the stock certificates
representing the Shares, and shall only take action with respect to the stock
transfers in accordance with the terms of this Agreement.
3. RESTRICTIONS ON TRANSFER OF SHARES.
-----------------------------------
3.1 Restrictions Relating to Securities Laws and This Agreement.
Employee acknowledges that the Shares are being sold pursuant to one or more
exemptions from registration under federal and applicable state securities
laws. These exemptions and the terms of this Agreement require that certain
restrictions be placed on the transfer of the Shares.
3.1.1 Employee shall not offer, sell, transfer, assign, market, pledge,
encumber, or otherwise alienate or hypothecate the Shares until such time as
the restrictions imposed pursuant to this Agreement have lapsed in accordance
with subsection 4.1.
3.1.2 Following the lapse of the restrictions contained in this
Agreement, Employee may offer, sell, transfer, assign, or otherwise market
the Shares only if (i) Employee registers the Shares under the Securities Act
of 1933 and applicable state securities laws, or (ii) Employee provides to the
Corporation an opinion of counsel satisfactory to the Corporation that such
offer, sale, transfer, assignment, or other marketing of the Shares is exempt
from the registration requirements of the Securities Act of 1933 and
applicable state securities laws and that registration is not required under
such Act and such state securities laws, and the purchaser, transferee, or
assignee agrees to execute a Subscription Agreement with Corporation
agreeing to the same restrictions on transfer contained in this Agreement
which are related to federal and state securities laws.
3.2 Stock Legends. The stock certificates evidencing the Shares shall
be issued in the sole name of Employee (but shall be held by DNC until the
restrictions described above in paragraph 3.1.1 shall have lapsed in
accordance with the terms and conditions of this Agreement) and shall bear
two restrictive legends which shall provide:
3.2.1 "THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER STATE
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SECURITIES LAWS. IT HAS BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED,
SOLD, TRANSFERRED, ASSIGNED, OR OTHERWISE MARKETED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THIS SECURITY UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL SATISFACTORY
TO THE CORPORATION THAT SUCH OFFER, SALE, TRANSFER, ASSIGNMENT, OR OTHER
MARKETING IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH
STATE SECURITIES LAWS AND THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
AND SUCH STATE SECURITIES LAWS."
3.2.2 "The securities represented by this certificate are subject to the
terms and restrictions contained in a Stock Purchase and Restriction Agreement
between the holder of the certificate and the Corporation dated May 15, 1996;
such shares are subject to forfeiture or cancellation under the terms of said
Agreement; and the securities cannot be sold, transferred, assigned, pledged,
encumbered, or otherwise alienated or hypothecated except pursuant to the
terms of said Agreement."
3.2.3 The legend described above in paragraph 3.2.1 will remain on any
certificate evidencing ownership of the Shares continuously and any purchaser,
transferee, or assignee of the Shares will be subject to these same
restrictions on transferability of the Shares.
4. LAPSE OF RESTRICTIONS.
----------------------
4.1 Lapse of Contractual Restrictions. The restrictions in paragraph
3.1.1 shall lapse as follows:
4.1.1 Said restrictions shall lapse with respect to one-third of the
Shares each August 1 during each of the three consecutive calendar years
beginning on August 1, 1996, but only if on the date the restrictions are to
lapse Employee has been an employee of DNC continuously from the Effective
Date to such date of lapse. Temporary leaves of absence which are approved by
the Board of Directors of DNC shall not be considered a break in Employee's
continuous employment with DNC. If calculation of one-third of the Shares
would result in a fractional share interest, the number of Shares shall be
rounded down to the next lowest number of full shares for each of the first
two lapse dates, with the balance to the third lapse date.
4.1.2 Notwithstanding paragraph 4.1.1, said restrictions shall lapse
with respect to all of the Shares which remain restricted upon the sale of
all or substantially all of the assets of DNC.
4.1.3 Notwithstanding paragraph 4.1.1, said restrictions shall lapse
with respect to all of the Shares which remain restricted in the event the
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Board of Directors of DNC decides, in its sole and exclusive judgment, that
the restrictions shall lapse because of (i) a significant corporate event,
e.g., a merger, consolidation, change of control of the ownership of the
majority of the stock of DNC, or other significant events as determined
by the Board of Directors of DNC, or (ii) in the event of Employee's death,
permanent total disability, or retirement.
4.2 Lapse of Securities Restrictions. The restrictions in paragraph 3.1.2
shall not lapse.
5. TERMINATION OF EMPLOYMENT AND RESALE OF SHARES TO CORPORATION.
5.1 Requirement to Sell Restricted Shares Upon Termination of
Employment. In the event of the termination of Employee's employment with
DNC, all Shares still subject to the restrictions imposed by paragraph 3.1.1
shall be sold by Employee to DNC at the purchase price described in
subsection 1.2.
5.2 Procedure to Sell Restricted Shares to Corporation. Upon the
termination of Employee's employment with DNC as described above in
subsection 5.1, DNC shall purchase the Shares obligated to be sold to DNC by
tendering payment of the purchase price to Employee within thirty days of
Employee's termination of employment with DNC. In the event that DNC does
not have sufficient funds to purchase the restricted Shares, it may, at its
option, elect to purchase the shares by making a promissory note in favor
of Employee pursuant to which the purchase price shall be paid in five equal
annual installments bearing interest at 10%. Immediately following payment
of the purchase price, whether paid by cash or promissory note, DNC may
present the applicable stock transfers to its transfer agent or appropriate
officer and have the restricted Shares transferred to DNC.
6. SECURITIES MATTERS. Employee hereby makes the following
representations and warranties upon which DNC may rely in connection with the
purchase and sale of the Shares:
6.1 Employee's offer to purchase is based upon information known to
Employee as an executive employee of DNC and on Employee's own independent
evaluation, which may include the counsel of Employee's own advisers;
6.2 Employee has reviewed the financial statements and records of DNC,
and at a reasonable time prior to purchase of the Shares has been afforded an
opportunity to request information from and pose questions to the officers of
DNC with respect to the terms and conditions of the purchase and sale of the
Shares to obtain any additional information necessary to verify the accuracy
of the financial statements and other information concerning DNC, and
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DNC has responded to all questions or inquiries to the satisfaction of
employee;
6.3 Employee understands that the transferability of the Shares is
restricted and that Employee cannot be expected to be able to readily
liquidate Employee's investment in DNC in case of an emergency;
6.4 Employee is purchasing the Shares for investment purposes and
Employee's own account, and has no present intention of distributing or
reselling the same. Employee acknowledges that Employee's State of residence
may impose restrictions on the right to transfer the Shares and that there are
restrictions on transfer under the Federal securities laws;
6.5 Employee is of legal age in accordance with laws of Employee's
State of residence; and
6.6 Employee, together with Employee's own advisers, including but not
limited to any designated purchaser representative, with whom he has consulted
in connection with his decision to purchase the Shares has sufficient
knowledge and experience in financial and business matters so as to enable
Employee to evaluate the merits and risks of the proposed investment.
7. NO IMPACT ON TERMS OF EMPLOYMENT. This Agreement shall have no
impact on the terms and conditions of Employee's employment with DNC, and
Employee shall remain an "at will" employee of DNC, meaning that Employee has
a right to terminate his employment relationship with DNC without notice at
any time and for any reason, and DNC has an identical right. Thus, this
Agreement shall not be evidence of any agreement or understanding, express or
implied, that DNC will employ Employee in any particular position, at any
particular rate of compensation, or for any particular period of time,
until such time as both parties agree to modify or change the terms of
employment.
8. MISCELLANEOUS.
8.1 Waiver. The failure to demand strict performance of one or more of
the terms, covenants, or conditions set forth herein shall not be construed as
a continuing waiver or relinquishment thereof and any party may at any time
demand strict and complete performance of said terms, covenants, and
conditions.
8.2 Construction and Interpretation of Terms. The titles used in this
Agreement are for convenience only and shall not affect the meaning of the
terms and provisions of this Agreement. Any words herein used in the singular
shall denote the plural as the context so requires and, when used herein in
the plural, shall denote the singular as the context so requires. Pronouns
used herein, whether masculine, feminine, or neuter, shall be interpreted as
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the context so requires. The language of all parts of this Agreement shall
in all cases be construed as a whole, according to its fair meaning, and not
strictly for or against any party. No presumptions or rules of interpretation
based upon the identity of the party preparing or drafting the Agreement, or
any part thereof, shall be applicable or invoked.
8.3 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective
successors and permitted assigns. Neither party may assign either this
Agreement or any of its rights, interests, or obligations hereunder without
the prior written approval of the other. For purposes of this Agreement,
Data National Corporation, as referred to herein as "DNC," shall include any
subsidiary of DNC and any successor in interest to DNC by way of merger,
consolidation, or operation of law.
8.4 Divisibility. In the event a court of competent jurisdiction
determines any provision of this Agreement to be void or unenforceable, the
remaining provisions shall remain in full force and effect.
8.5 Modification. No modification of this Agreement shall be valid or
binding upon the parties or entitled to any enforcement whatsoever unless such
modification is reduced to writing and signed and dated by both parties.
8.6 Notices. Any notice required or permitted to be given hereunder
shall be hand delivered; sent by prepaid certified mail, return receipt
requested; or sent by reputable overnight courier such as Federal Express,
and shall be deemed to have been given when hand delivered, three business
days after deposit in the U.S. mail, or one business day after timely deposit
with an overnight courier, as the case may be. All notices shall be sent or
delivered to the respective address specified on the signatory page of
the Agreement, except that either party, upon notice to the other party as
provided for herein, may change the address to which further notices shall
be sent.
8.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be an original, and all of which shall
constitute one and the same instrument.
8.8 Specific Performance. If any party to this Agreement fails to
perform any act required by the terms of this Agreement, then, in addition to
all other remedies available at law, the other party may institute and
maintain a proceeding to compel the specific performance of this Agreement by
the defaulting party.
8.9 Attorneys' Fees. If any party must resort to legal assistance to
enforce any of the terms or provisions of this Agreement, then, in addition
to any damages, injunction or other relief, all reasonable expenses of the
prevailing party, including but not limited to attorneys' fees, shall be
recoverable as costs.
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8.10 Documents and Instruments. The parties agree that they will
execute any and all documents and instruments necessary to effectuate and
carry out the terms and intent of this Agreement. If any party fails to
execute and deliver any such instrument, this Agreement shall constitute an
actual grant, assignment, and conveyance of the property and rights associated
therewith in such manner and with such force and effect as shall be necessary
to effectuate the terms and intent of this Agreement.
8.11 Entire Agreement. This Agreement contains the entire agreement
between the parties and supersedes all prior agreements, representations,
negotiations, statements, or proposals related to those matters set forth
herein.
8.12 Applicable Law. This Agreement shall be construed, interpreted, and
governed in accordance with the laws of the State of Colorado.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
EMPLOYEE: DATA NATIONAL CORPORATION:
BY (Signature) /s/ J. Scott Fowler BY (Signature) /s/ Richard S. Simms
(Printed Name) J. Scott Fowler Richard S. Simms
Vice President
(Address)
Data National Corporation
11415 West I-70 Frontage
Road-North
Wheat Ridge, CO 80033
4143-2:16955
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