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 (Date of earliest event reported): December 1, 1999
OSICOM TECHNOLOGIES, INC.
(Exact name of Registrant as specified in charter)
Commission File number: 0-15810
New Jersey 22-2367234
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
2800 28th Street, Suite 100
Santa Monica, California 90405
(Address of principal executive offices) (Zip Code)
(310) 581-4030
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS
Pursuant to a Stock Purchase Agreement between the Registrant and FIBR
Holdings, LLC, the Registrant sold to FIBR Holdings, LLC. Six Hundred Seventy-
Nine Thousand Four Hundred Eighty-Three (679,483) Shares at a purchase price of
Eleven and 0378/10000 Dollars ($11.0378) per Share or Seven Million Five
Hundred Thousand Dollars ($7,500,000). Andersen Weinroth & Co., L.P., a Delaware
limited partnership, is the sole voting member of FIBR Holdings, L.L.C. A copy
of the Stock Purchase Agreement is attached hereto as Exhibit A.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
A. Stock Purchase Agreement dated as of December 1, 1999,
between the Registrant and FIBR Holdings, LLC.
B. Registration Rights Agreement dated as of December 1, 1999
between the Registrant and FIBR Holdings, LLC
C. Letter Agreement dated November 6, 1999 between Registrant
and FIBR Holdings, LLC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OSICOM TECHNOLOGIES, INC.
DATE: December 15, 1999 By: /s/Christopher E. Sue
----------------------------
Christopher E. Sue
Vice-President Finance
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STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (the "Agreement"), dated as of December 1,
1999, by and between OSICOM TECHNOLOGIES, INC., a New Jersey corporation (the
"Company"), and FIBR HOLDINGS, LLC, a New York limited liability company (the
"Purchaser").
WHEREAS, the Company wishes to sell to the Purchaser, and the Purchaser
wishes to purchase from the Company, on the terms and subject to the conditions
set forth in this Agreement, shares of the Company's Common Stock, par value
$.30 per share (the "Shares"); and
WHEREAS, the Company has agreed to effect the registration of the
Shares to be issued pursuant to this Agreement under the Securities Act of 1933,
as amended (the "Securities Act"), pursuant to a Registration Rights Agreement
of even date herewith by and between the Company and the Purchaser attached
hereto as Exhibit A (the "Registration Rights Agreement"); and
WHEREAS, the sale of the Shares by the Company to the Purchaser will be
effected in reliance upon an exemption from securities registration in
accordance with Section 4(2) of the Securities Act and the rules and regulations
promulgated by the Securities and Exchange Commission (the "Commission") under
the Securities Act.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained in this Agreement, the Company and the Purchaser hereby
agree as follows:
1. PURCHASE AND SALE OF THE SHARES.
1.1 Agreement to Purchase and Sell. Upon the terms and subject to the
satisfaction of the conditions set forth herein, the Company agrees to sell at
the Closing (as defined in paragraph 1.2 below), and the Purchaser agrees to
purchase, Six Hundred Seventy-Nine Thousand Four Hundred Eighty-Three (679,483)
Shares at a purchase price equal to Eleven and 0378/10000 Dollars ($11.0378) per
Share or Seven Million Five Hundred Thousand Dollars ($7,500,000) in the
aggregate (the "Purchase Price").
1.2 Closing. Subject to the satisfaction or waiver of the conditions set
forth herein, the closing of the purchase and sale of the Shares hereunder
(the "Closing") will be held simultaneously with the execution and delivery of
this Agreement and will be deemed completed when this Agreement and the
other Transaction Documents (as defined below) have been executed and delivered
by the Company and Purchaser (which delivery may be effected by facsimile
transmission), and full payment of the Purchase Price has been made by the
Purchaser by wire transfer of immediately available funds against physical
delivery by the Company of duly executed certificates representing the Shares
purchased by the Purchaser at the Closing. The date on which the Closing occurs
is referred to herein as the "Closing Date".
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1.3 Certain Definitions. When used herein, (A) "business day" shall mean any
day on which the New York Stock Exchange and commercial banks in the city of New
York are open for business, (B) an "affiliate" of a party shall mean any person
or entity controlling, controlled by or under common control with that party and
(C) "control" shall mean, with respect to an entity, the ability to direct the
business, operations or management of such entity, whether through an equity
interest therein or otherwise.
2. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.
The Purchaser hereby makes the following representations and warranties
to the Company and agrees with the Company that, as of the date of this
Agreement and as of the Closing Date:
2.1 Authorization; Enforceability. The Purchaser is duly and validly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization with full power and authority
to purchase the Shares and to execute and deliver this Agreement. This Agreement
constitutes the Purchaser's valid and legally binding obligation, enforceable in
accordance with its terms, except as such enforcement may be limited by (i)
applicable bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights
generally and (ii) general principles of equity.
2.2 Accredited Investor; Investment Intent. The Purchaser is an accredited
investor as that term is defined in Rule 501 of Regulation D, and is acquiring
the Shares solely for its own account for investment purposes as a principal and
not with a present view to the public resale or distribution of all or any part
thereof, except pursuant to sales that are exempt from the registration
requirements of the Securities Act or sales registered under the Securities Act;
provided, however that in making such representation, the Purchaser does not
agree to hold the Shares for any minimum or specific term and reserves the right
to sell, transfer or otherwise dispose of the Shares at any time in accordance
with the provisions of this Agreement and with Federal and state securities laws
applicable to such sale, transfer or disposition.
2.3 Information. The Company has provided the Purchaser with information
regarding the business, operations and financial condition of the Company, and
has granted to the Purchaser the opportunity to ask questions of and receive
answers from representatives of the Company, its officers, directors, employees
and agents concerning the Company and materials relating to the terms and
conditions of the purchase and sale of the Shares hereunder.
2.4 Limitations on Disposition. The Purchaser acknowledges that, except as
provided in the Registration Rights Agreement, the Shares have not been and are
not being registered under the Securities Act and may not be transferred or
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resold without registration under the Securities Act or unless pursuant to an
exemption therefrom.
2.5 Legend. The Purchaser understands that the certificates representing the
Shares will bear at issuance a restrictive legend in substantially the following
form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), or the securities laws of any state, and may not be
offered or sold unless a registration statement under the Securities
Act and applicable state securities laws shall have become effective
with regard thereto, or an exemption from registration under the
Securities Act and applicable state securities laws is available in
connection with such offer or sale. The securities are subject to the
provisions of a Stock Purchase Agreement dated December 1, 1999 between
the Company and FIBR Holdings, LLC with respect to voting."
Notwithstanding the foregoing, it is agreed that, as long as
(A) the resale or transfer (including without limitation a pledge) of any of the
Shares is registered pursuant to an effective registration statement, (B) the
Shares can be sold to the public pursuant to Rule 144 under the Securities Act
("Rule 144") and a registered broker dealer provides to the Company a customary
broker's Rule 144 letter, or (C) the Shares are eligible for sale to the public,
without limitation as to the amount of or manner in which the Shares may be
sold, under Rule 144(k) or any successor provision, the Shares shall be issued
without any legend or other restrictive language and, with respect to Shares
upon which such legend is stamped, the Company shall issue new certificates
without the first sentence of such legend to the holder upon request. In
addition to the foregoing in the event that the Shares are transferred to any
transferee other than a member of the Purchaser, the Company will issue new
certificates without the last sentence of such legend.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby makes the following representations and warranties
to the Purchaser and agrees with the Purchaser that, as of the date of this
Agreement and as of the Closing Date:
3.1 Organization, Good Standing and Qualification. Each of the Company and
its subsidiaries is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization and has
all requisite corporate power and authority to carry on its business as
now conducted. The term "subsidiaries" shall mean entities in which the Company
has a voting equity interest of 50% or greater.
3.2 Authorization; Consents. The Company has the requisite corporate power
and authority to enter into and perform its obligations under (i) this
Agreement, (ii) the Registration Rights Agreement and (iii) all other
agreements, documents, certificates or other instruments executed and
delivered by or on behalf of the Company at any Closing (the instruments
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described in (i), (ii) and (iii) being collectively referred to herein as the
"Transaction Documents") and to issue and sell the Shares to the Purchaser
in accordance with the terms hereof. All corporate action on the part of
the Company by its officers, directors and stockholders necessary for the
authorization, execution and delivery of, and the performance by the Company of
its obligations under the Transaction Documents has been taken, and no further
consent or authorization of the Company, its Board of Directors, its
stockholders, any governmental agency or organization (other than as may be
required under the Securities Act and applicable state securities laws in
respect of the Registration Rights Agreement), or any other person or entity is
required (pursuant to any rule of the National Association of Securities
Dealers, Inc. (the "NASD") or otherwise).
3.3 Enforcement. The Transaction Documents constitute valid and legally
binding obligations of the Company, enforceable in accordance with their
respective terms, except as such enforcement may be limited by (i) applicable
bankruptcy, insolvency, reorganization or other laws of general application
relating to or affecting the enforcement of creditors' rights generally and (ii)
general principles of equity.
3.4 Disclosure Documents; Agreements; Financial Statements; Other
Information. The Company has filed with the Commission: (i) the Company's
Annual Report on Form 10-K for the year ended January 31, 1999, (ii) the
Company's Quarterly Reports on Form 10-Q for the three month periods ended
April 30, 1999 and July 31,1999, and the Company's Balance Sheet as of October
31, 1999 and Profit and Loss Statement for the three month period ended October
31, 1999, (such Balance Sheet and Profit and Loss Statement being referred to
herein as the "October Financial Statements") and (iii) all Current Reports on
Form 8-K required to be filed by the Company with the Commission since January
31, 1999 (collectively, the "Disclosure Documents"). The Company is not aware
of any event occurring on or prior to the Closing (other than the transactions
effected hereby) that would require the filing of, or with respect to which the
Company intends to file, a Form 8-K after the Closing. Each Disclosure
Document, as of the date of the filing thereof with the Commission (and with
respect to the October Financial Statements, as of October 31, 1999), conformed,
and as of the Closing Date will conform, in all material respects to the
requirements of the Exchange Act, and the rules and regulations thereunder and
such Disclosure Document did not, as of the date of such filing (and with
respect to the October Financial Statements, as of October 31, 1999), and will
not, as of the Closing Date, contain an untrue statement of material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading; provided, however, that any information set forth
in any Disclosure Document which is a forward-looking statement as defined in
Rule 175(c) promulgated by the Commission under the Securities Act shall
not be deemed to contain an untrue statement of material fact as long as such
forward-looking statement was made with a reasonable basis and in good faith.
3.5ab Capitalization. The capitalization of the Company as of November 30, 1999,
including its authorized capital stock, the number of shares issued and
outstanding, the number of shares issuable and reserved for issuance pursuant to
the Company's stock option plans, the number of shares issuable and reserved for
issuance pursuant to securities exercisable for, or convertible into or
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exchangeable for any shares of Common Stock is set forth on Schedule 3.5 to this
Agreement. All of such outstanding shares of capital stock have been, or upon
issuance will be, validly issued, fully paid and non-assessable. No shares of
the capital stock of the Company are subject to preemptive rights or any other
similar rights of the stockholders of the Company or any liens or encumbrances
created by or through the Company. Except as disclosed in the Disclosure
Documents, or as contemplated herein, there are no outstanding options,
warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into or exercisable
or exchangeable for, any shares of capital stock of the Company or any of its
subsidiaries, or arrangements by which the Company or any of its subsidiaries is
or may become bound to issue additional shares of capital stock of the Company
or any of its subsidiaries.
3.6 Valid Issuance. The Shares are duly authorized and, when issued, sold and
delivered in accordance with the terms hereof, (i) will be duly and validly
issued, fully paid and nonassessable, free and clear of any taxes, liens,
claims, preemptive or similar rights or encumbrances imposed by or through the
Company, (ii) based in part upon the representations of the Purchaser in this
Agreement, will be issued, sold and delivered in compliance with all applicable
Federal and state securities laws and (iii) will be entitled to all of the
rights, preferences and privileges of the holders of the Common Stock of the
Company.
3.7 No Conflict with Other Instruments. The execution, delivery and
performance of this Agreement and the other Transaction Documents, and
consummation of the transactions contemplated hereby and thereby will not result
in (a) a violation of any provision of the Certificate of Incorporation or
by-laws of the Company or its subsidiaries, (b) a violation of any Law (as
defined below) or any judgment, decree, order, regulation or rule of any court
or other Governmental Entity (as defined in Section 5.1.8 hereof) applicable to
the Company or its subsidiaries, or (c) any violation or be in conflict with or
constitute, with or without the passage of time and giving of notice, either a
default under any provision, instrument or contract to which the Company or any
of its subsidiaries are a party or by which any of their assets are subject, or
an event which results in the creation of any lien, charge or encumbrance upon
any assets of the Company or of any of its subsidiaries or the triggering of any
preemptive or anti-dilution rights or rights of first refusal or first offer on
the part of holders of the Company's securities. "Law" shall mean any statute,
ordinance, code, rule, regulation or order enacted, adopted, promulgated,
applied or followed by any Governmental Entity.
3.8 Breach of Contract; Litigation.
3.8.1 The Company is not aware of any breaches in any agreement to which
it is a party which breach could have a material adverse effect on the Company
and its subsidiaries taken as a whole.
3.8.2 Except as described in the Disclosure Documents, there is no
material claim or litigation pending, or, to the Company's knowledge,
threatened or contemplated, against the Company or any of its subsidiaries,
or against any officer, director or employee of the Company or any such
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subsidiary in connection with such person's employment therewith. Neither the
Company nor any of its subsidiaries is a party to or subject to the provisions
of, any order, writ, injunction, judgment or decree of any court or
government agency or instrumentality which could reasonably be expected to have
a material adverse effect on the consolidated business or financial condition
of the Company and its subsidiaries taken as a whole.
3.9 Trading on NASDAQ. The Common Stock is designated for quotation on the
NASDAQ National Market and trading in the Common Stock on such market has not
been suspended. The Company is in full compliance with the continued designation
criteria of the NASDAQ National Market and does not reasonably anticipate that
the Common Stock will be delisted from the NASDAQ National Market, whether by
reason of the transactions contemplated by this Agreement or the other
Transaction Documents and is not aware of any inquiry by or received any notice
from the NASD regarding any failure or alleged failure by the Company to comply
with such requirements which has not been favorably resolved prior to the date
hereof.
3.10 Solicitation. Neither the Company nor any of its subsidiaries or
affiliates, nor any person acting on its or their behalf, (i) has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D) in connection with the offer or sale of the Shares or (ii) has,
directly or indirectly, made any offers or sales of any security or solicited
any offers to buy any security, under any circumstances that would require
registration of the Shares under the Securities Act.
3.11 Registration Rights. No holders of the Company's Common Stock nor of
any securities convertible or exchangeable into Common Stock nor of other rights
to acquire Common Stock (except employee stock options) have any rights to
require such Common Stock to be registered under the Securities Act, whether
pursuant to a demand, piggyback or other type of registration right.
4. COVENANTS OF THE COMPANY.
4.1 Corporate Existence. The Company shall, so long as any Purchaser or any
affiliate of the Purchaser beneficially owns any of the Shares, maintain its
corporate existence in good standing and shall pay all taxes owed by it when due
except for taxes which the Company reasonably disputes.
4.2 Provision of Information. The Company shall provide the Purchaser, as
long as the Purchaser holds any Shares, with copies of its annual reports on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
proxy statements and other materials sent to stockholders, in each such case
promptly after the filing thereof with the Commission.
4.3 Reporting Status. As long as the Purchaser or any affiliate of the
Purchaser beneficially owns any Shares and until the date on which any of the
foregoing may be sold to the public pursuant to Rule 144(k) (or any successor
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rule or regulation), (i) the Company shall timely file with the Commission all
reports required to be so filed pursuant to the Exchange Act and (ii) the
Company shall not terminate its status as an issuer required by the Exchange Act
to file reports thereunder even if the Exchange Act or the rules or regulations
thereunder would permit such termination. The Company agrees to file with the
Commission a Form 8-K describing the terms of the transactions contemplated by
this Agreement and the Registration Rights Agreement, with this Agreement
attached to such Form 8-K as an exhibit thereto, on or before the tenth (10th)
day following the Closing Date in the form required by the Exchange Act.
4.4 Quotation on NASDAQ. The Company shall (i) promptly following the
Closing, take such action as may be necessary to include the Shares for
quotation on the NASDAQ National Market and (ii) use its best efforts to
maintain the listing of the Shares on such market.
4.5 Blue Sky Filings. In connection with the sale of the Shares to the
Purchaser, the Company will comply with, and make all filings required under,
any State securities law to which the sale of the Shares hereunder is subject.
5. CONDITIONS TO CLOSING.
5.1 Conditions to Purchaser's Obligations at Closing. The Purchaser's
obligations at the Closing, including without limitation its obligation to
purchase the Shares, are conditioned upon the fulfillment (or waiver by the
Purchaser) of each of the following events as of the Closing Date:
5.1.1 the representations and warranties of the Company set forth in
this Agreement shall be true and correct in all material respects as of such
date as if made on such date;
5.1.2 the Company shall have complied with or performed in all material
respects all of the agreements, obligations and conditions set forth in this
Agreement that are required to be complied with or performed by the Company on
or before the Closing;
5.1.3 the Company shall have delivered to the Purchaser a certificate,
signed by an officer of the Company, certifying that the conditions specified
in paragraphs 5.1.1, 5.1.2 and 5.1.7 have been fulfilled as of the Closing;
5.1.4 the Company shall have delivered to the Purchaser a certificate,
signed by the Secretary of the Company, attaching a copy of the resolutions
of the Board of Directors authorizing the transactions contemplated hereby,
and certifying that such resolutions have not been modified or rescinded since
the date of their adoption by the Company's Board of Directors;
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5.1.5 the Company shall have delivered duly executed certificates
representing the Shares being purchased;
5.1.6 the Company shall have executed and delivered the Registration
Rights Agreement;
5.1.7 there shall have been no material adverse changes in the Company's
consolidated business or financial condition since the date of the Company's
most recent audited financial statements contained in the Disclosure Documents;
5.1.8 there shall be no action or proceeding by or before any federal,
state, local or foreign government or any court of competent
jurisdiction, administrative agency or commission or other governmental
authority or instrumentality, domestic or foreign (a "Governmental Entity")
or NASD pending or threatened challenging or seeking to restrain or prohibit
the purchase and sale of any of the Shares or any of the other transactions
contemplated by this Agreement or seeking to obtain damages from either party
hereto in connection with the purchase and sale of the Shares or any of the
other transactions contemplated by this Agreement.
5.1.9 there shall be no statute, rule, regulation, executive order, decree,
temporary restraining order, preliminary injunction, permanent injunction or
other order, enacted, entered, promulgated, enforced or issued by any
Governmental Entity or other legal restraint or prohibition preventing the
purchase and sale of the Shares in effect.
5.1.10 the Purchaser shall have received an opinion of the Company's
counsel in form and substance as set forth on Exhibit B.
5.2 Conditions to Company's Obligations at Closing. The Company's obligations
at the Closing are conditioned upon the fulfillment (or waiver by the Company)
of each of the following events as of the Closing Date:
5.2.1 the representations and warranties of the Purchaser shall be true and
correct in all material respects as of such date as if made on such date; and
5.2.2 the Purchaser shall have complied with or performed all of the
agreements, obligations and conditions set forth in this Agreement that are
required to be complied with or performed by the Purchaser on or before the
Closing.
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5.2.3 there shall be no action or proceeding by or before any Governmental
Entity or NASD pending or threatened challenging or seeking to restrain or
prohibit the purchase and sale of any of the Shares or any of the other
transactions contemplated by this Agreement or seeking to obtain damages from
either party hereto in connection with the purchase and sale of the Shares or
any of the other transactions contemplated by this Agreement.
5.2.4 there shall be no statute, rule, regulation, executive order, decree,
temporary restraining order, preliminary injunction, permanent injunction or
other order, enacted, entered, promulgated, enforced or issued by any
Governmental Entity or other legal restraint or prohibition preventing the
purchase and sale of the Shares in effect.
6. ADDITIONAL TRANSACTIONS
6.1 Board of Directors Seat. At or subsequent to the Closing, the
Purchaser shall have the right to designate one member of the Board of Directors
of the Company to serve until the annual meeting of the shareholders of the
Company in 2001. The nominee shall be required to complete a questionnaire in
the same form as has been executed by all other directors of the Company.
Subject to the approval of the existing directors upon review of such
questionnaire and any other relevant information, such approval not to be
unreasonably withheld, the existing directors will elect such nominee to the
Board of Directors, and such individual shall receive the same compensation as
each other non-employee director of the Company.
6.2 Election of Directors. From and after the Closing Date, the
Purchaser shall, and shall use its reasonable best efforts to cause any of its
members to which the Purchaser transfers the Shares, to vote the Shares at all
times prior to their sale at any regular or special meeting of the shareholders
of the Company called for the purpose of filling positions on the Board of
Directors of the Company, or in any written consent executed in lieu of such a
meeting of shareholders, in favor of the nominees proposed by the Company's
Board of Directors. In the event that the Purchaser or its members do not cast
its vote in accordance with the previous sentence, the Company's Board of
Directors is hereby authorized to do so. As a condition precedent to having the
Company's transfer agent effect a transfer of any Shares to a member of the
Purchaser, the Company may require such transferee(s) to execute a document
granting the Board of Directors authority consistent with this paragraph.
6.3 Right of Participation. The Company agrees that, prior to any offer
or sale by the Company's subsidiary, Meret Communications, Inc. ("Meret") of
Meret's common stock (or any securities convertible or exercisable into or
exchangeable for common stock) it will deliver, at least ten (10) business days
prior to such proposed issuance, to the Purchaser written notice describing the
proposed offering, including the aggregate amount to be offered and the terms
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and conditions thereof (a "Participation Notice"), and provide the Purchaser
with an option to participate in such offering up to $7,500,000 (the "Right of
Participation") on the terms and conditions set forth in the Participation
Notice. The Purchaser may exercise its Right of Participation by delivering
written notice of such exercise (an "Exercise Notice") to the Company on or
before the eighth (8th) business day following receipt of the Participation
Notice, which notice shall specify the dollar amount of the securities that the
Purchaser wishes to purchase in such offering. In the event that a Purchaser
exercises its Right of Participation with respect to such offering, the Company
shall, within one business day thereafter (i) determine in good faith from the
lead investor or lead venture financier in the event of a private offering or
from the managing underwriter in the event of an initial public offering whether
the Purchaser will be allowed to participate in such offering, provided that the
Company shall recommend to such lead investor or lead venture financier or
managing underwriter that the Purchaser be allowed to so participate, and to
purchase the dollar amount of securities requested by the Purchaser and (ii)
notify the Purchaser of such determination. The Right of Participation shall
apply only to Meret's initial financing subsequent to the Closing Date. In the
event that the Purchaser transfers Shares to any of its members and until such
time as such members transfer the Shares, each such member shall have the rights
afforded to the Purchaser under this Section 6.3 with respect to such Shares (it
being the intent of the parties that the Right of Participation for the
Purchaser and its members not exceed $7,500,000 in the aggregate); provided that
the Purchaser shall retain and have the sole right to receive the Participation
Notice from the Company and deliver the Exercise Notice to the Company in
accordance with the provisions of this Section 6.3.
6.4 Commission. At the Closing, the Company shall pay to Andersen
Weinroth Capital Corp., by certified check or wire transfer, $300,000 in
connection with the transactions contemplated by this Agreement.
7. MISCELLANEOUS.
7.1 Public Disclosure. The existence of this Agreement and the transactions
contemplated therein shall not be disclosed by either Party without the other
Party's prior written consent, such consent not to be unreasonably withheld.
7.2 Survival; Severability. The representations, warranties, covenants and
indemnities made by the parties herein shall survive the Closing notwithstanding
any due diligence investigation made by or on behalf of the party seeking to
rely thereon. In the event that any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision; provided that in such case the parties shall negotiate in good faith
to replace such provision with a new provision which is not illegal,
unenforceable or void, as long as such new provision does not materially change
the economic benefits of this Agreement to the parties.
7.3 Successors and Assigns. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
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permitted assigns of the parties. Nothing in this Agreement, express or implied,
is intended to confer upon any party other than the parties hereto or their
respective successors and permitted assignors any rights, remedies, obligations
or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement. In addition to the assignment of rights and
obligations contemplated under Sections 6.2 and 6.3 hereof to members of the
Purchaser as expressly provided for in Sections 6.2 and 6.3 hereof, the
Purchaser may assign its rights and obligations hereunder, in connection with
any private sale or transfer of the Shares in accordance with the terms hereof,
as long as, as a condition precedent to such transfer, the transferee executes
an acknowledgment agreeing to be bound by the applicable provisions of this
Agreement in which case the term "Purchaser" shall be deemed to refer to such
transferee as though such transferee were an original signatory hereto. The
Company may not assign it rights or obligations under this Agreement.
7.4 No Reliance. Each party acknowledges that (i) it has such knowledge in
business and financial matters as to be fully capable of evaluating this
Agreement, the other Transaction Documents and the transactions contemplated
hereby and thereby, (ii) it is not relying on any advice or representation of
the other party in connection with entering into this Agreement, the other
Transaction Documents or such transactions (other than the representations made
in this Agreement or the other Transaction Documents), (iii) it has not received
from such party any assurance or guarantee as to the merits (whether legal,
regulatory, tax, financial or otherwise) of entering into this Agreement or the
other Transaction Documents or the performance of its obligations hereunder and
thereunder, and (iv) it has consulted with its own legal, regulatory, tax,
business, investment, financial and accounting advisors to the extent that it
has deemed necessary, and has entered into this Agreement and the other
Transaction Documents based on its own independent judgment and on the advice of
its advisors as it has deemed necessary, and not on any view (whether written or
oral) expressed by such party.
7.5 Governing Law; Jurisdiction. This Agreement shall be governed by and
construed under the laws of the State of New Jersey without regard to the
conflict of laws provisions thereof. Each party hereby irrevocably submits to
the exclusive jurisdiction of the state and federal courts sitting in the State
of New Jersey, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit action or
proceeding, any claim that it is nor personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall
be deemed to limit in any way any right to serve process in any manner permitted
by law.
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7.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
7.7 Headings. The headings used in this Agreement are used for convenience
only and are not to be considered in construing or interpreting this Agreement.
7.8 Notices. Any notice, demand or request required or permitted to be given
by any party to any other party pursuant to the terms of this Agreement shall be
in writing and shall be deemed given (i) when delivered personally or by
verifiable facsimile transmission (with an original to follow) on or before 5:00
p.m., eastern time, on a business day or, if such day is not a business day, on
the next succeeding business day, (ii) on the next business day after timely
delivery to a nationally-recognized overnight courier and (iii) on the third
business day after deposit in the U.S. mail (certified or registered mail,
return receipt requested, postage prepaid), addressed to the parties as follows:
If to the Purchaser:
FIBR Holdings, LLC
1330 Avenue of the Americas
36th Floor
New York, New York 10019
Attn: Rohit Phansalkar
Tel: (212) 842-1606
Fax: (212) 842-1540
with copies to:
Andersen, Weinroth & Co., L.P.
1330 Avenue of the Americas
36th Floor
New York, New York 10019
Attn: Chris Andersen
Tel: (212) 842-1606
Fax: (212) 842-1540
and
Swidler Berlin Shereff Friedman
405 Lexington Avenue
New York, New York 10174
Attn: Jeffry S. Hoffman, Esq.
Tel: 212-758-9500
Fax: 212-891-9598
If to the Company:
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Osicom Technologies, Inc.
2800 28th Street, Suite 100
Santa Monica, CA 90405
Attn: Chief Financial Officer
Tel: 310-581-4030
Fax: 310-581-4032
with a copy to:
Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP
Metro Corporate Campus One
P.O. Box 5600
Woodbridge, New Jersey 07095-0988
Attn: W. Raymond Felton, Esq.
Tel: 732-549-5600
Fax: 732-549-1881
7.9 Expenses. The Company and the Purchaser each shall pay all costs and
expenses that it incurs in connection with the negotiation, execution, delivery
and performance of this Agreement; provided, however, that the Company shall
reimburse the Purchaser for legitimate and itemized legal fees and expenses
incurred by it in connection with its due diligence investigation of the Company
and the negotiation, preparation, execution, delivery and performance of this
Agreement and the other Transaction Documents in an amount not to exceed
Twenty-Five Thousand Dollars ($25,000).
7.10 Entire Agreement; Amendments. This Agreement and the other Transaction
Documents constitute the entire agreement between the parties with regard to the
subject matter hereof and thereof, superseding all prior agreements or
understandings, whether written or oral, between or among the parties.
Notwithstanding the foregoing, Sections 1 and 2 of the certain letter between
Andersen, Weinroth & Co., L.P. and the Company, dated November 5, 1999, remain
in full force and effect. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended except pursuant to a written
instrument executed by the Company and the Purchaser and no provision hereof may
be waived other than by a written instrument signed by the party against whom
enforcement of any such waiver is sought.
IN WITNESS WHEREOF, this Agreement has been executed as of the date
first written above.
FIBR HOLDINGS, LLC OSICOM TECHNOLOGIES, INC.
By: /s/ Rohit Phansalkar By: /s/ Christopher E. Sue
----------------------- --------------------------------
Name: Rohit Phansalkar Name: Christopher E. Sue
----------------------- --------------------------------
Title: Manager Title: Vice President Finance
----------------------- --------------------------------
<PAGE>
EXHIBIT B
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into this 1st day of December, 1999, by and between Osicom Technologies,
Inc., a New Jersey corporation (the "Company") and FIBR Holdings, LLC, a New
York limited liability company (the "Purchaser").
This Agreement is made pursuant to a Stock Purchase Agreement,
dated as of December 1, 1999 (the "Purchase Agreement") between the Company and
the Purchaser. In order to induce the Purchaser to enter into the Purchase
Agreement, the Company has agreed to provide the registration rights set forth
in this Agreement. The execution and delivery of this Agreement is a condition
to closing under the Purchase Agreement. All defined terms used but not defined
herein shall have the meanings ascribed to them in the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms
shall have the following meanings:
Act: The Securities Act of 1933, as amended.
Commission: The Securities and Exchange Commission.
Common Stock: The Common Stock, $.30 par value per share, of
the Company.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Holders: As defined in Section 2(b) hereof.
Issue Date: The date on which the Transfer Restricted
Securities are issued to the Purchaser pursuant to the Purchase Agreement.
NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in the Registration
Statement (as defined herein), as amended or supplemented by any prospectus
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supplement with respect to the terms of the offering of any portion of the
Transfer Restricted Securities (as defined herein) covered by the Registration
Statement and by all other amendments and supplements to the Prospectus,
including post-effective amendments, and all material which may be incorporated
by reference into such Prospectus.
Registrable Date: The date upon which the first of the
following occur: (a) the Company distributes to its shareholders or otherwise
sells, transfers or disposes of all or substantially all of the common stock of
NETsilicon, Inc., a Massachusetts corporation, that it owns, or (b) the first
anniversary of the Issue Date.
Transfer Restricted Securities: Each share of the Company's
Common Stock issued pursuant to the Purchase Agreement, until each such share
(i) has been effectively registered under the Act, or (ii) is distributed to the
public pursuant to Rule 144 under the Act or (iii) may be sold or transferred
pursuant to Rule 144(k)(or any similar provisions then in force) under the Act
or otherwise.
Underwriter: Any underwriter, placement agent, selling broker,
dealer manager, qualified independent underwriter or similar securities industry
professional.
Underwritten Registration or Underwritten Offering: An
offering in which securities of the Company are sold to an Underwriter or with
the assistance of such Underwriter for reoffering to the public on a firm
commitment or best efforts basis.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled
to the benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is
deemed to be a holder of Transfer Restricted Securities (each, a "Holder")
whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTRATION
(a) Registration on Demand. (i) At any time after the
Registrable Date the Purchaser on behalf of the Holders of the Transfer
Restricted Securities shall have the right to require the Company, by written
request, to cause the Transfer Restricted Securities to be registered with the
Commission by filing a Registration Statement to cover the offer and resale by a
Holder from time to time and the methods of distribution elected by such holder
of Transfer Restricted Securities as set forth in such Registration Statement.
Within 10 days after receipt of any such request, the Company will serve a
written notice of such registration request to all Holders, and the Company will
include in such registration all Transfer Restricted Securities of such Holders
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with respect to which the Company has received written requests for inclusion
therein within 20 business days after the delivery such notice. As used herein,
"register", "registered" and "registration" each refer to a registration of the
Transfer Restricted Securities effected by filing with the Commission a
Registration Statement in compliance with the Act and the declaration or
ordering by the Commission of effectiveness of such Registration Statement.
"Registration Statement" shall mean Form S-3 or such other form as may be
available to the Company and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein. In connection with any registration, the Company will pay
for all registration expenses (as defined in Section 5 hereof) and will pay for
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any annual audit, the fees and expenses incurred in connection with
the listing of the securities to be registered on each securities exchange on
which similar securities issued by the Company are then listed.
(iii) A registration will not be deemed to have been effected pursuant to
this Section 3(a) unless it has been declared effective by the Commission and
the Company has complied in all material respects with its obligations under
this Agreement with respect thereto; provided that if, after it has become
effective, the offering of shares of Transfer Restricted Securities pursuant to
such registration is or becomes the subject of any stop order, injunction or
other order or requirement of the Commission or any other governmental or
administrative agency, or if any court prevents or otherwise limits the sale of
the shares of Common Stock pursuant to the registration at any time within the
time period provided under Section 4(b)(ii)(y), such registration will be deemed
not to have been effected. If (i) a registration requested pursuant to this
Section 3(a) is deemed not to have been effected or (ii) the registration
requested pursuant to this Section 3(a) does not remain effective for a period
of at least the period provided under Section 4(b)(ii)(y), then the Company
shall continue to be obligated to effect such registration pursuant to this
Section 3(a).
(b) Incidental Registration. If the Company at any time proposes
to register (other than a registration on Form S-8 or S-4 or any successor or
similar forms) any of its equity securities under the Act, whether or not for
sale for its own account, in a manner which would permit registration of
Transfer Restricted Securities for offer or resale under the Act, it will each
such time use its best efforts to effect the registration under the Act of all
Transfer Restricted Securities held by the Holders; provided, however, that (i)
if such registration involves an Underwritten Offering, all Holders, if
requested by an Underwriter, must sell their Transfer Restricted Securities to
the Underwriters selected by the Company on the same terms and conditions as
apply to the Company; and (ii) if, (x) at any time after giving written notice
of its intention to register any securities pursuant to this Section 3(b) and
(y) prior to the effective date of the registration statement filed in
connection with such registration, the Company shall determine for any reason
not to register such securities, the Company shall give written notice to all
Holders of Transfer Restricted Securities and, thereupon, shall be relieved of
its obligation to register any Transfer Restricted Securities in connection with
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such proposed registration. Notwithstanding the foregoing, the Holders shall
have the absolute right in their sole discretion not to participate in any
Underwritten Offering in the event that the terms or conditions of such offering
are not satisfactory.
(i) If a registration pursuant to Section 3(b) involves an Underwritten
Offering and the managing Underwriter advises the Company in writing that, in
its opinion, the number of equity securities (including all Transfer Restricted
Securities) which the Company, the Holders and any other Persons intend to
include in such registration exceeds the largest number of securities which can
be sold without having an adverse effect on such offering, including the price
at which such securities can be sold, the Company will include in such
registration (x) first, all the securities the Company proposes to sell for its
own account, and (y) second, to the extent that the number of securities which
the Company proposes to sell for its own account pursuant to Section 3(b) hereof
is less than the number of equity securities which the Company has been advised
can be sold in such offering without having the adverse effect referred to
above, all Transfer Restricted Securities requested to be included in such
registration by the Holders pursuant to Section 3(b) hereof (provided that if
the number of Transfer Restricted Securities requested to be included in such
registration by the Holders pursuant to Section 3(b) hereof, together with the
number of Transfer Restricted Securities to be included in such registration
pursuant to clause (x) of this Section 3(b)(i), exceeds the number which the
Company has been advised can be sold in such offering without having the adverse
effect referred to above, the number of such Transfer Restricted Securities
requested to be included in such registration by the Holders pursuant to Section
3(b)(i) hereof shall be limited to such extent and shall be allocated pro rata
among all such Holders on the basis of the relative number of Transfer
Restricted Securities then held by such Holder) and all other person having
similar registration rights with respect to the Company's Common Stock.
(ii) In the event of an Underwritten Offering, upon the Company's request,
any Holder will execute and deliver a custody agreement and power of attorney in
form and substance reasonably satisfactory to the Holders with respect to the
Transfer Restricted Securities to be registered pursuant to this Section 3(b) (a
"Custody Agreement and Power of Attorney"). The Custody Agreement and Power of
Attorney will provide, among other things, that the Holders will deliver to, and
deposit in custody with, the custodian and attorney-in-fact named therein a
certificate or certificates representing such shares of Transfer Restricted
Securities (duly endorsed in blank by the registered owner or owners thereof or
accompanied by duly executed stock powers in blank) and irrevocably appoint said
custodian and attorney-in-fact as the Holder's agent and attorney-in-fact with
full power and authority to act under the Custody Agreement and Power of
Attorney on the Holder's behalf with respect to the matters specified thereon.
The Holders agree that they will execute such other agreements as the Company
may reasonably request to further evidence the provision of this Section 3(b).
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(c) No Holder of Transfer Restricted Securities may include
any of its Transfer Restricted Securities in any Registration Statement pursuant
to this Agreement unless such Holder furnishes to the Company in writing, within
ten (10) business days after receipt of a request therefor, such information
related to such Holder as the Company may reasonably request for use in
connection with any Registration Statement or Prospectus or preliminary
Prospectus included therein.
(d) Notwithstanding any other provision of Section 3(a), if
the Company determines in the good faith judgment of the Company's counsel that
the filing of a Registration Statement would require the disclosure of material
information which the Company has a good faith business purpose for preserving
as confidential, the Company shall not be required to commence using its best
efforts to effect a registration pursuant to Section 3(a) until the earlier of
(i) the date upon which such material information is disclosed to the public (it
being understood that nothing herein shall require such disclosure) or ceases to
be material or (ii) 60 days after the Company makes such good faith
determination. In addition, the Company shall have the right to defer the
initial filing or the effectiveness of a Registration Statement filed pursuant
to Section 3(a) hereof for a reasonable period of time to permit the Company to
have prepared, to the extent not already available, financial statements for the
Company's most recently completed fiscal period ended at the time that the
demand for registration is received by the Company, only to the extent that the
Company, in consultation with its regularly retained counsel and certified
public accountants, determines in good faith that the inclusion of such
financial statements is desirable to avoid the use of stale financial
statements. The Company may impose stop-transfer instructions with respect to
the Transfer Restricted Securities of the Holders for any period of suspension
of effectiveness of the Registration Statement being filed pursuant to Section
3(a).
SECTION 4. REGISTRATION PROCEDURES
In connection with the Registration Statement, the Company
will use its best efforts to effect such registration to permit the sale of the
Transfer Restricted Securities being sold in accordance with the intended method
or methods of distribution or disposition thereof, and pursuant thereto the
Company will as expeditiously as possible:
(a) prepare, file and use its best efforts to cause to become
effective a registration statement under the Act regarding the Transfer
Restricted Securities to be offered; provided, however, that before filing a
Registration Statement or any Prospectus, or any amendments or supplements
thereto, (other than documents incorporated by reference after the initial
filing of the Registration Statement), the Company will furnish to the Holders
and the Underwriter(s), if any, copies of all such documents proposed to be
filed, and the Company will not file any Registration Statement or amendment
thereto or any Prospectus or any supplement thereto to which (i) the
Underwriter(s), if any, shall reasonably object or (ii) the Holders of a
majority of the Transfer Restricted Securities to be registered in the
Registration Statement shall reasonably object, in each such case within ten
(10) business days after the receipt thereof. A Holder or Underwriter, if any,
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shall be deemed to have reasonably objected to such filing if the Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to be
filed contains a material misstatement or omission which misstatement or
omission is specifically identified to the Company in writing within such ten
(10) business days;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the Prospectus used in connection
therewith as may be necessary (i) to prevent the Registration Statement from
containing any material misstatement or omission and (ii) to keep such
Registration Statement effective and to comply with the provisions of the Act
with respect to the disposition of all Transfer Restricted Securities until the
later of (x) the disposition of all of the Transfer Restricted Securities
covered by such Registration Statement or (y) the expiration of three (3) years
after such Registration Statement becomes effective;
(c) use its best efforts to register or qualify all Transfer
Restricted Securities covered by such Registration Statement under such other
securities or blue sky laws of such jurisdictions as the Shareholders or any
Underwriter of such Transfer Restricted Securities shall reasonably request, and
do any and all other acts and things which may be necessary or advisable to
enable the Shareholders or any Underwriter to consummate the disposition in such
jurisdictions of its Transfer Restricted Securities covered by such Registration
Statement;
(d) advise the Underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in writing,
(i) when the Prospectus or any Prospectus supplement or post-effective amendment
has been filed, and, with respect to the Registration Statement or any
post-effective amendment thereto, when the same has become effective, (ii) of
any request by the Commission for amendments to the Registration Statement or
any amendments or supplements to the Prospectus or for additional information
relating thereto, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the Act or of
the suspension by any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes, and (iv) of the
existence of any fact and the happening of any event that makes any statement of
a material fact made in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or changes in
the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, or any state
securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or blue sky laws, the Company shall
use its best efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
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(e) in the case of any Underwritten Offering, furnish to the
Shareholders and the Underwriters, addressed to them, (A) an opinion of counsel
for the Company, dated the date of the closing under the underwriting agreement
relating to any Underwritten Offering, and (B) a comfort letter signed by the
independent public accountants who have certified the Company's financial
statements included in such Registration Statement, covering substantially the
same matters with respect to such Registration Statement (and the Prospectus
included therein) and, in the case of such accountants' letter, with respect to
events subsequent to the date of such financial statements, as are customarily
covered in opinions of issuer's counsel and in accountants' letters,
respectively, delivered to underwriters in underwritten public offerings of
securities and such other matters and the Shareholders may reasonably request;
(f) promptly following the filing of any document that is to
be incorporated by reference into the Registration Statement or the Prospectus
(after initial filing of the Registration Statement), provide copies of such
document to the Holders;
(g) deliver to each Holder and each of the Underwriter(s), if
any, without charge, as many copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as such Persons
may reasonably request; the Company consents to the use of the Prospectus and
any amendment or supplement thereto by each of the Holders and each of the
Underwriter(s), if any, in connection with the public offering and the sale of
the Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(h) comply with all applicable rules and regulations of the
Commission, including Section 11(a) of the Securities Act and Rule 158 of the
Securities Act, and make generally available to its security holders, as soon as
practicable, a consolidated earnings statement (which need not be audited) for
the twelve-month period (i) commencing at the end of any fiscal quarter in which
Transfer Restricted Securities are sold to Underwriters in a firm or best
efforts Underwritten Offering or (ii) if not sold to Underwriters in such an
offering, beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the Registration Statement;
(i) make all filings required to be made with the NASD and in
the performance of any due diligence investigation by any Underwriter (including
any "qualified independent Underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD).
(j) cooperate with the Holders and the Underwriter(s), if any,
to facilitate the timely preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and not bearing any restrictive
legends; and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders or the Underwriter(s),
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if any, may request at least two business days prior to any sale or Transfer
Restricted Securities made by such Underwriter(s);
(k) if any fact or event contemplated by clause (d)(v) above
shall exist or have occurred, prepare a supplement or post-effective amendment
to the Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading;
(l) cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange or quotation
system on which similar securities issued by the Company are then listed, if
any;
Each Holder as to which any Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.
Each Holder agrees by acquisition of such Transfer Restricted
Securities that, upon receipt of any notice from the Company of the existence of
any fact of the kind described in Section 4(d)(iv) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities until such
Holder's receipt of the copies of the supplemented or amended Prospectus, or
until it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the Prospectus. If
so directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the time period regarding the effectiveness
of the Registration Statement set forth in Section 4(b) hereof shall be extended
by the number of days during the period from and including the date of the
giving of such notice pursuant to Section 4(d)(v) hereof to and including the
date when each selling Holder covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus or shall have
received the Advice.
SECTION 5. REGISTRATION EXPENSES
Except as otherwise specifically set forth herein, all
expenses incident to the Company's performance of or compliance with this
Agreement will be borne solely by the Company, regardless whether a Registration
Statement becomes effective, including without limitation:
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(i) all registration and filing fees and expenses (including filings made
with the NASD);
(ii) fees and expenses of compliance with federal securities or state blue
sky laws;
(iii) expenses of printing (including, without limitation, expenses of
printing or engraving certificates for the Transfer Restricted Securities in a
form eligible for deposit with Depository Trust Company and of printing
Prospectuses), messenger and delivery service and telephone;
(iv) reasonable fees and disbursements of counsel for the Company;
(v) fees and disbursements of all independent certified public accountants
of the Company (including the expenses of any special audit and "cold comfort"
letters required by or incident to such performance);
(vi) fees and expenses associated with any NASD filing required to be made
in connection with the Registration Statement, including, if applicable, the
fees and expenses of any "qualified independent Underwriter" (and its counsel)
that is required to be retained in accordance with the rules and regulations of
the NASD;
(vii) the Company's internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees of any rating
agency (collectively, the "registration expenses").
The expense of any broker's commission or Underwriters' discount or commission
in connection with the sale of Transfer Restricted Securities shall be borne by
the Holder of such Transfer Restricted Securities.
SECTION 6. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless each
Holder (each such Holder an "Indemnified Holder") and in the case of an
Underwritten Offering, each Underwriter participating in the distribution (each
such Underwriter an "Indemnified Underwriter"), each officer and director of
each Holder and each person that controls each Indemnified Holder or Indemnified
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and agents, employees, officers and directors or any such
controlling person of any Indemnified Holder or Indemnified Underwriter from and
against any and all losses, claims, damages, judgments, liabilities and expenses
(including the reasonable fees and expenses of counsel and other expenses in
connection with investigating, defending or settling any such action or claim)
as they are incurred arising out of or based upon any untrue statement or
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alleged untrue statement of a material fact contained in the any Registration
Statement or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
Prospectus or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, except (i) the Company shall not be
liable to any such Indemnified Holder or Indemnified Underwriter in any such
case insofar as such losses, claims, damages, judgments, liabilities or expenses
arise out of, or are based upon, any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to such
Indemnified Holder or Indemnified Underwriter furnished in writing by such
Indemnified Holder or Indemnified Underwriter to the Company expressly for use
therein and (ii) the Company shall not be liable to any such Indemnified Holder
or Indemnified Underwriter under the indemnity agreement in this Section 6(a)
with respect to any preliminary Prospectus to the extent that any such loss,
claim, damage, judgment, liability or expense (x) arise out of or are based upon
an untrue statement or omission in such prospectus and (y) such untrue statement
or omission is corrected in an amendment or supplement to such prospectus, and
(z) having previously been furnished by or on behalf of the Company with
sufficient copies of such prospectus as so amended or supplemented, such
Indemnified Holder or Indemnified Underwriter thereafter fails to deliver such
prospectus as so amended or supplemented prior to or concurrently with the sale
of a person asserting the claim from which such loss, claim, damages, judgments,
liabilities or expenses arise.
(b) If any action or proceeding (including any governmental or
regulatory investigation or proceeding) shall be brought or asserted against any
Indemnified Holder or Indemnified Underwriter with respect to which indemnity
may be sought against the Company pursuant to Section 6(a), such Indemnified
Holder or Indemnified Underwriter shall promptly notify the Company in writing,
and the Company shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to such Indemnified Holder or
Indemnified Underwriter and payment of all fees and expenses; provided, however,
that the omission so to notify the Company shall not relieve the Company from
any liability that they may have to any Indemnified Holder or Indemnified
Underwriter (except to the extent that the Company is materially prejudiced or
otherwise forfeits substantive rights or defenses by reason of such failure). An
Indemnified Holder or Indemnified Underwriter shall have the right to employ
separate counsel in any such action or proceeding and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Holder or Indemnified Underwriter unless (i) the
Company agrees in writing to pay such fees and expenses, (ii) the Company has
failed promptly to assume the defense and employ counsel satisfactory to the
Indemnified Holder or Indemnified Underwriter or (iii) the named parties to any
such action or proceeding (including any impleaded parties) include both the
Indemnified Holder or Indemnified Underwriter, on the one hand, and the Company
and such Indemnified Holder or Indemnified Underwriter shall have been advised
in writing by its counsel that representation of it and the Company by the same
counsel would be inappropriate under applicable standards of professional
conduct (whether or not such representation has been proposed) due to actual or
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potential conflicts of interests between them (in which case the Company shall
not have the right to assume the defense of such action on behalf of such
Indemnified Holder or Indemnified Underwriter). The Company shall not be liable
for any settlement of any such action effected without the written consent of
the Company, but if settled with the written consent of the Company, or if there
is a final judgment with respect thereto, the Company agrees to indemnify and
hold harmless each Indemnified Holder or Indemnified Underwriter from and
against any loss or liability by reason of such settlement or judgment. The
Company shall not, without the prior written consent of each Indemnified Holder
or Indemnified Underwriter affected thereby, effect any settlement of any
pending or threatened proceeding in which such Indemnified Holder or Indemnified
Underwriter has sought indemnity hereunder, unless such settlement includes an
unconditional release of such Indemnified Holder or Indemnified Underwriter from
all liability arising out of such action, claim, litigation or proceeding. For
the purposes of this Section 6(b), the term "conflict of interest" shall mean
that there are one or more legal defenses available to the Indemnified Holder or
the Company, as applicable, which different or additional defenses make joint
representation inappropriate.
(c) Each Indemnified Holder and Indemnified Underwriter agrees
to indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statement and any person controlling the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act
(collectively, the "Company Indemnified Parties") to the same extent as the
foregoing indemnity from the Company to such Indemnified Holder or Indemnified
Underwriter, but only with respect to information relating to such Indemnified
Holder or Indemnified Underwriter furnished to the Company in writing by such
Indemnified Holder or Indemnified Underwriter, respectively, expressly for use
in the Registration Statement, Prospectus (or any amendment of supplement
thereto), or any preliminary Prospectus. In case any action shall be brought
against any Company Indemnified Party based on the Registration Statement,
Prospectus (or any amendment of supplement), or any preliminary Prospectus and
in respect of which indemnification may be sought against each Indemnified
Holder and Indemnified Underwriter pursuant to this Section 6(c), such
Indemnified Holder and Indemnified Underwriter shall have the rights and duties
given to the Company by Section 6(a) (except that if the Company shall have
assumed the defense thereof, such Indemnified Holder and Indemnified Underwriter
may, but shall not be required to employ separate counsel therein and
participate in the defense thereof and the fees and expenses of such counsel
shall be at the expense of such Indemnified Holder or Indemnified Underwriter)
and the Company Indemnified Parties shall have the rights and duties given to
the Indemnified Holders or Indemnified Underwriters by Section 6(b). In no event
shall the liability of any Indemnified Holder hereunder be greater in amount
than the dollar amount of the net proceeds (after broker's commissions or
underwriters discounts and commissions) received by such Indemnified Holder upon
the sale of the Transfer Restricted Securities giving rise to such
indemnification obligation.
<PAGE>
(d) If the indemnification provided for in this Section 6 is
unavailable to any party entitled to indemnification pursuant to Section 6(a) or
6(c), then such indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, judgments, liabilities and expenses
in such proportion as is appropriate to reflect the relative fault of the
Company on the one hand and each Indemnified Holder or Indemnified Underwriter
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages, judgments, liabilities or expenses, as well as any
other relevant equitable considerations. The relative fault of the Company on
the one hand and each Indemnified Holder and Indemnified Underwriter on the
other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or by each Indemnified Holder and Indemnified Underwriter on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. In no event shall
the liability of any Indemnified Holder hereunder be greater in amount than the
dollar amount of the net proceeds (after broker's commissions or underwriters
discounts and commissions) received by such Indemnified Holder upon the sale of
the Transfer Restricted Securities giving rise to such contribution obligation.
(e) The Company and each Indemnified Holder and Indemnified
Underwriter agree that it would not be just and equitable if contribution
pursuant to Section 6(d) were determined by pro rata allocation or by any other
method of allocation that does not take account of the equitable considerations
referred to in Section 6(d). The amount paid or payable by an indemnified party
as a result of the losses, claims, damages, liabilities or expenses referred to
in the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. No person found guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not found guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in
this Section 6 are in addition to any liability that any indemnifying party may
otherwise have to any indemnified party.
SECTION 7. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Offering
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
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<PAGE>
underwriting arrangements. In addition to the foregoing, all Holders agree that
in connection with the first Underwritten Offering following the date hereof,
they shall not, to the extent requested by the Company and the lead Underwriter
in such offering, sell or otherwise transfer or dispose of any Transfer
Restricted Securities (other than (i) sales, transfers or dispositions to donees
who agree to be similarly bound or (ii) sales, transfers or dispositions of
Transfer Restricted Securities included in the registration of the first
Underwritten Offering or in any registration statement previously declared
effective) during a reasonable and customary period of time, not to exceed 180
days, next following the effective date of the Registration Statement relating
to the first Underwritten Offering; provided, however, that such agreement by
the Holders not to dispose of Transfer Restricted Securities during such period
shall apply only if all executive officers, directors and principal shareholders
of the Company and all other persons with registration rights relating to any of
the Company's securities to be registered in such offering (whether or not
pursuant to this Agreement) enter into similar agreements with the Company and
the Underwriters containing the same terms as set forth in this Section 7. In
order to enforce the foregoing covenant contained in the prior sentence, the
Company may impose stop-transfer instructions with respect to the Transfer
Restricted Securities of the Holders until the end of such agreed upon period.
SECTION 8. MISCELLANEOUS
(a) No Inconsistent Agreements. The Company will not on or
after the date of this Agreement enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders of
Transfer Restricted Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders or Transfer Restricted
Securities hereunder do not in any way conflict with and are not inconsistent
with the rights granted to the Holders of the Company's securities under any
other agreements.
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of
Shareholders.
(c) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, telecopier, or
air courier guaranteeing overnight delivery;
(i) if to a Holder of Transfer Restricted Securities,
at the address set forth on the records of the Company's registrar, with
a copy to Andersen Weinroth, & Co., L.P., 1330 Avenue of the Americas,
36th Floor, New York, New York 10019, Attn: Chris Andersen, Tel.: 212-842-1605,
Fax: 212-842-1540, and a copy to Swidler Berlin Shereff Friedman, LLP, 405
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<PAGE>
Lexington Avenue, New York, New York, 10174 Attn: Jeffrey S. Hoffman, Esq.,
Telephone: 212-758-9500, Fax: 212-891-9598.; and
(ii) if to the Company, initially at its address set
forth in the Purchase Agreement and thereafter at such other address,
notice of which is given in accordance with the provisions of this Section, with
a copy to Greenbaum, Rowe, Smith, Ravin, Davis & Himmel, LLP, 99 Wood
Avenue South, P.O. Box 5600, Woodbridge, New Jersey 07095, Attn: W. Raymond
Felton, Esq., Telephone: 732-549-5600, Fax: 732-549-1881.
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if telecopied; and on
the next business day, if timely delivered to an air courier guaranteeing
overnight delivery.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be binding
upon a successor or assign of a Holder of Transfer Restricted Securities unless
and to the extent such successor or assign acquired Transfer Restricted
Securities from such Holder. Notwithstanding any assignment by the Purchaser of
this Agreement, the Purchaser shall remain the entity which pursuant to Section
3(a) has the right to require the Company by written request to cause the
Transfer Restricted Securities to be registered pursuant to the terms of Section
3(a) unless the Purchaser expressly agrees otherwise in a written instrument
executed by the Purchaser.
(f) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
<PAGE>
(h) Governing Law; Jurisdiction. This Agreement shall be
governed by and construed under the laws of the State of New Jersey without
regard to the conflict of laws provisions thereof. Each party hereby irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
the State of New Jersey, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit
action or proceeding, any claim that it is nor personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall
be deemed to limit in any way any right to serve process in any manner permitted
by law.
(i) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(j) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the securities sold pursuant to the Purchase Agreement. This
Agreement supersedes all prior agreements and understandings between the
parties with respect to such subject matter.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
OSCIOM TECHNOLOGIES, INC.
By:
-----------------------------------
FIBR HOLDINGS, LLC
By:
-----------------------------------
<PAGE>
EXHIBIT C
Anderson, Weinroth & Co., L.P.
1330 Avenue of the Americas
New York, New York 10019-5400
November 5, 1999
Mr. Par Chadha
Osicom Technologies, Inc.
2800 28th Street, Suite 100
Santa Monica, California 90405
Dear Mr. Chadha:
Anderson, Weinroth & Co., L.P. ("AW") proposes to provide assistance to
Osicom Technologies, Inc. ("FIBR" or the "Company") with respect to the
identification and recruitment of senior officers and directors for the Company
and/or its subsidiaries or affiliates. AW also desires to establish a strategic
ownership position in the Company through a negotiated transaction (the
"Transaction"), subject to satisfactory completion of due diligence, as
described in the Paragraph 3 below. The terms of this agreement (the
"Agreement") shall be as follows:
1. For every senior officer ("Officer") identified by AW and
employed by FIBR or any of its subsidiaries or affiliates, the
Company will grant AW seventy-five thousand (75,000) warrants
(the "Warrants") with a life of two (2) years and exercisable
at the same price or prices at which the Officer's employee
stock options are exercisable. The Warrants shall vest six
months after the Officer's start date, and only if upon such
date the Officer remains employed by Osicom or its subsidiary
or affiliate. In addition, the Company will issue unregistered
FIBR common shares to AW in an amount equal to ten percent
(10%) of the total value of the Officer's first-year
compensation.
2. For every director (the "Director") identified by AW and
elected to the Board of the Company or its subsidiary or
affiliate, the Company will grant the Director a number of
options and having such teens as would ordinarily be granted
under the Directors Stock Option Plan (or other applicable
compensation plan) of the Company or its subsidiary or
affiliate; For each Director identified by AW, the Company
will grant, or cause to be granted to AW twenty-five thousand
(25,000) warrants, each having a life of two (2) years but
otherwise having the same terms as the options granted the
Director. The warrant grant described in this paragraph herein
shall be made as of the date the Director is elected to the
Board of the Company or its subsidiary or affiliate.
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3. The Company will sell to AW, or to special-purpose entity
created by AW, six hundred seventy-nine thousand four hundred
eighty-three (679,483)newly-issued shares of the Company's
common stock (the "New Shares") having a value of seven and
one half million U.S. dollars (USD $7,500,000) For the
purposes of the Transaction described herein, the New Shares
shall be issued at USD $11.04/New Share, such price being
equal to the average of the closing prices for the Company's
common stock for the four (4) trading days immediately
preceding and the day upon which this Agreement is executed,
as reported by Nasdaq In the event that AW and the Company
complete the Transaction, the Company and AW agree as follows:
(i) The Company shall pay to AW a cash fee equal to four
percent (4%) of the Transaction amount, payable at
the Closing of the Transaction.
(ii) AW shall have the right to nominate one Director (the
"nominee") to the Company's Board. The Company shall
have the right to approve Nominee, such approval
shall not be unreasonably withheld. The Company shall
have no obligation to pay any compensation to AW in
connection with the appointment of the Nominee to the
Company's Board (e.g., the terms of Paragraph 2 above
shall not apply to the appointment of the Nominee).
(iii) AW and the Company shall enter into a definitive
Stock Purchase Agreement containing standard
representations, warranties, and indemnification
provisions. The Company and AW agree to use their
best efforts to complete the Transaction before
December 1, 1999.
(iv) AW and the Company shall enter into a Registration
Rights Agreement containing one demand registration
at the Company's expense on a "best efforts" basis,
and piggyback registration rights. The demand
registration described therein shall not be available
before the earlier of the (i) first date upon which
the Company distributes the shares of NETsilicon,
Inc. common stock which it owns; or (ii) the first
anniversary of the date upon which the New Shares are
issued.
(v) AW agrees that for as long as it shall own any of
the New Shares, AW shall vote all of its New
Shares in favor of the slate of directors nominated
by the Company's management at any meeting of the
Company's shareholders.
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(vi) The Company shall reimburse AW its legitimate
out-of-pocket legal and other expenses incurred in
connection with the Transaction, such expenses
reimbursement not to exceed twenty-five thousand U.S.
dollars (USD $25,000).
4. AW and/or an entity created by AW shall have the right to invest in
the Company's Optical Networking subsidiary ("ON") in the first round of
financing conducted by ON to occur (the "ON Investment"), subject to the
following conditions.
(i) In the event that the first round of ON financing to occur is
venture capital financing, then AW shall have the right to
invest up to seven and one half million U.S. Dollars (USD
$7,50O,000) in that round, if and only if that investment is
approved by ON's lead venture financier. The Company agrees on
behalf of it and ON's management to recommend that such lead
venture financier approve the ON investment. If so approved,
AW shall have the right to make the ON Investment at the
outstanding valuation of ON.
(ii) In the event that the first round of ON financing to occur is
an initial public offering of stock, then AW shall have the
right to purchase up to seven and one half million U.S.
Dollars (USD $7,500,000) of the common stock of ON in the IPO
at the IPO price, if an only if that investment is approved by
the managing underwriter for the ON IPO. The Company agrees on
behalf of it and ON's management to recommend that such
managing underwriter approve the ON investment.
AW and the Company agree that the terms of Paragraphs 1 and 2 above shall
be binding upon them whether or not the Transaction described in Paragraph
3 above is completed.
If you are in agreement with the foregoing, please indicate your acceptance by
signing on the space provided below.
Andersen, Weinroth & Co., L.P.
-------------------------------
Rohit Phansalkar
Osicom, Technologies, Inc.
- -------------------------------
Par Chadha, Chairman and CEO
