SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
Spanlink Communications, Inc.
(Name of Issuer)
Common Stock, No Par Value
(Title of Class of Securities)
373656107
(CUSIP Number)
Larry R. Carter
170 West Tasman Drive
San Jose, CA 95134
(408) 526-4000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 29, 2000
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box
[ ]
(Continued on following pages)
<PAGE>
- ----------------------
CUSIP NO. 373656107 13D
- ----------------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Cisco Systems, Inc. (I.R.S. I.D. # 77-0059951)
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ] (b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of California
- ----------------------------- --------- ----------------------------------------
7 SOLE VOTING POWER
NUMBER
OF
SHARES 0
BENEFICIALLY
OWNED BY
REPORTING
PERSON
WITH
--------- ----------------------------------------
8 SHARED VOTING POWER
2,430,000
--------- ----------------------------------------
9 SOLE DISPOSITIVE POWER
0
--------- ----------------------------------------
10 SHARED DISPOSITIVE POWER
2,430,000
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,430,000
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
[ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
55%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
- -------------------------
CUSIP NO. 373656107 13D
- -------------------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Brett A. Shockley
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ] (b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. citizenship
- ----------------------------- --------- ----------------------------------------
7 SOLE VOTING POWER
NUMBER
OF
SHARES 79,575
BENEFICIALLY
OWNED BY
REPORTING
PERSON
WITH
--------- ----------------------------------------
8 SHARED VOTING POWER
2,440,425
--------- ----------------------------------------
9 SOLE DISPOSITIVE POWER
79,575
--------- ----------------------------------------
10 SHARED DISPOSITIVE POWER
2,440,425
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,520,000
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
[ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
57%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
- ----------------------
CUSIP NO. 373656107 13D
- ----------------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Loren A. Singer, Jr
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ] (b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. citizenship
- ----------------------------- --------- ----------------------------------------
7 SOLE VOTING POWER
NUMBER
OF
SHARES 90,000
BENEFICIALLY
OWNED BY
REPORTING
PERSON
WITH
--------- ----------------------------------------
8 SHARED VOTING POWER
2,430,000
--------- ----------------------------------------
9 SOLE DISPOSITIVE POWER
90,000
--------- ----------------------------------------
10 SHARED DISPOSITIVE POWER
2,430,000
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,520,000
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
[ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
57%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
- -----------------------
CUSIP NO. 373656107 13D
- -----------------------
- ----------- --------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Todd A. Parenteau
- ----------- --------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ] (b) [X]
- ----------- --------------------------------------------------------------------
3 SEC USE ONLY
- ----------- --------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- ----------- --------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- ----------- --------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. citizenship
- ----------------------------- --------- ----------------------------------------
7 SOLE VOTING POWER
NUMBER
OF
SHARES 90,000
BENEFICIALLY
OWNED BY
REPORTING
PERSON
WITH
--------- ----------------------------------------
8 SHARED VOTING POWER
2,430,000
--------- ----------------------------------------
9 SOLE DISPOSITIVE POWER
90,000
--------- ----------------------------------------
10 SHARED DISPOSITIVE POWER
2,430,000
- ----------- --------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,520,000
- ----------- --------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES*
[ ]
- ----------- --------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
57%
- ----------- --------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ----------- --------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
Neither the filing of this Schedule 13D nor any of its contents shall be deemed
to constitute an admission by Cisco Systems, Inc. that it is the beneficial
owner of any of the Common Stock of Spanlink Communications, Inc. referred to
herein for purposes of Section 13(d) of the Securities Exchange Act of 1934, as
amended (the "Act"), or for any other purpose, and such beneficial ownership is
expressly disclaimed.
<PAGE>
Item 1. Security and Issuer.
This statement on Schedule 13D relates to the common stock, no par
value per share (the "Issuer Common Stock"), of Spanlink Communications, Inc., a
Minnesota corporation (the "Issuer"). The principal executive office of the
Issuer are located at 7125 Northland Terrace, Minneapolis, Minnesota 55428.
Item 2. Identity and Background.
(a) The names of the persons filing this statement are Cisco Systems,
Inc., a California corporation ("Cisco"), Brett A. Shockley, Loren A. Singer,
Jr., and Todd A. Parenteau (collectively the "Subscribers" and together with
Cisco, the "Reporting Persons").
(b) The address of the principal office and principal business of Cisco
is 170 West Tasman Drive, San Jose, California 95134. The principal business
address of Messrs. Shockley, Singer and Parenteau is 7125 Northland Terrace,
Minneapolis, Minnesota 55428.
(c) Cisco is a leading supplier of high-performance, multimedia,
multiprotocol internetworking solutions. Cisco technology is used to build
enterprise-wide networks that link geographically dispersed local-area and
wide-area networks to form a single information infrastructure. Cisco products
include software-based routers, bridges, workgroup systems, ATM switches, access
servers and router management applications. Set forth in Schedule A is the name
and present principal occupation or employment and the name, principal business
and address of any corporation or other organization in which such employment is
conducted, of each of Cisco's directors and executive officers as of the date
hereof. Brett A. Shockley is Chief Executive Officer and Chairman of the Issuer;
Loren A. Singer, Jr. is an engineer and sole proprietor of Beagle Software, 800
Washington Avenue N., Suite 418, Minneapolis, Minnesota 55401; and Todd A.
Parenteau is the New Technology Engineer of the Issuer.
(d) During the past five years, none of the Reporting Persons or, to
Cisco's knowledge, any person named in Schedule A to this Statement, has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) During the past five years, none of the Subscribers was a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction as a result of which such person was or is subject to a judgment,
decree or final order enjoining future violations of or prohibiting or mandating
activity subject to Federal or State securities laws or finding any violation
with respect to such laws. During the past five years, neither Cisco nor, to
Cisco's knowledge, any person named in Schedule A to this Statement, was a party
to a civil proceeding of a judicial or administrative body of competent
jurisdiction as a result of which such person was or is subject to a judgment,
decree or final order enjoining future violations of or prohibiting or mandating
activity subject to Federal or State securities laws or finding any violation
with respect to such laws.
(f) Brett A. Shockley, Loren A. Singer, Jr. and Todd A. Parenteau are
United States citizens.
<PAGE>
Item 3. Source and Amount of Funds or Other Consideration.
Pursuant to an Agreement and Plan of Merger dated as of February 25,
2000 (the "Merger Agreement"), included as Exhibit 1 to this Schedule 13D, by
and among Cisco, Spanlink Acquisition Corp., a Minnesota corporation
("Purchaser"), and the Issuer, and subject to the conditions set forth therein
(including approval by stockholders of the Issuer), the Purchaser will be merged
with and into the Issuer (the "Merger"). Following the Merger, the separate
corporate existence of the Purchaser shall cease and the Issuer shall continue
as the surviving corporation ("Surviving Corporation").
In furtherance of such acquisition, Cisco has entered into a Stock
Purchase Agreement dated as of February 25, 2000, with the Purchaser (the
"Series A Agreement") pursuant to which Cisco has agreed to purchase preferred
stock of the Purchaser. The Purchaser has made a tender offer ("Offer") to
purchase all of the shares of Common Stock of the Issuer (the "Shares" or
"Issuer Common Stock") at a price per Share of $10.50 net to the seller in cash
(the "Offer Price").
Immediately prior to the closing of such purchase in connection with
the Offer, each of the Subscribers shall transfer to Purchaser eight hundred and
ten thousand (810,000) shares of Issuer Common Stock in exchange for eight
hundred and ten thousand (810,000) shares of Purchaser Common Stock.
Item 4. Purpose of Transaction.
(a) - (b) As described in Item 3 above, this statement relates to the
Merger of Purchaser with and into Issuer in a merger pursuant to the applicable
provisions of the Merger Agreement and the Minnesota Business Corporation Act.
At the effective time of the Merger (the "Effective Time"), the separate
existence of the Purchaser will cease to exist and Issuer will continue as the
Surviving Corporation.
In furtherance of the Merger, Cisco has entered into the Series A
Agreement pursuant to which Cisco has agreed to purchase preferred stock of the
Purchaser. The Purchaser has made the Offer to purchase all of the Shares at the
Offer Price.
At the Effective Time, each share of capital stock of the Purchaser
issued and outstanding immediately prior to the Effective Time shall, by virtue
of the Merger and without any action on the part of the holder thereof, be
converted into and become one validly issued, fully paid and nonassessable share
of capital stock of the Surviving Corporation, with the same designation as to
class or series and the same rights and preferences as applied to the capital
stock of the Purchaser immediately prior to the Effective Time.
Merger is subject to the approval of the Merger Agreement by the
Issuer's stockholders, any required regulatory approvals and the satisfaction or
waiver of certain other conditions as more fully described in the Merger
Agreement. The foregoing summary of the Merger is qualified in its entirety by
reference to the Merger Agreement, which is further incorporated herein in its
entirety by reference.
(c) Not applicable.
<PAGE>
(d) Upon consummation of the Merger, the directors of the Purchaser
immediately prior to the Effective Time shall be the initial directors of the
Surviving Corporation and shall hold office until their respective successors
are duly elected and qualified, or their earlier death, resignation or removal.
The officers of the Purchaser immediately prior to the Effective Time shall be
the initial officers of the Surviving Corporation and shall hold office until
their respective successors are duly elected and qualified, or their earlier
death, resignation or removal.
(e) Other than as a result of the Merger and Offer described in Item 3
above, not applicable.
(f) Not applicable.
(g) Upon consummation of the Merger, the Articles of Incorporation of
the Purchaser, as in effect immediately prior to the Merger, shall be the
Articles of Incorporation of the Surviving Corporation until thereafter amended
in accordance with the provisions thereof and the Merger Agreement and
applicable law. Upon consummation of the Merger, the Bylaws of Purchaser in
effect at the Effective Time shall be the Bylaws of the Surviving Corporation
until thereafter amended in accordance with the provisions thereof and the
Merger Agreement and applicable law.
(h) - (i) If the Merger is consummated as planned, the Issuer Common
Stock will be deregistered under the Act and delisted from The Nasdaq Stock
Market's National Market.
(j) Other than described above, each of the Reporting Persons currently
has no plan or proposals which relate to, or may result in, any of the matters
listed in Items 4(a) - (j) of Schedule 13D (although each of the Reporting
Persons reserves the right to develop such plans).
Item 5. Interest in Securities of the Issuer.
(a) - (b) The number of Shares covered by the Merger is 2,430,000,
which constitutes approximately 55% of the Issuer Common Stock based on the
number of shares outstanding on February 25, 2000, as represented by the Issuer
in the Merger Agreement.
As a result of the Subscription Agreement, the Reporting Persons may be
deemed to be the beneficial owners of at least 2,430,000 shares of Issuer Common
Stock. Such Issuer Common Stock constitutes approximately 55% of the issued and
outstanding shares of Issuer Common Stock. The Reporting Persons have shared
power to vote all of the Shares.
Cisco does not have the sole power to vote or to direct the vote or to
dispose or to direct the disposition of any shares of Issuer Common Stock. In
addition, Cisco (i) is not entitled to any rights as a stockholder of Issuer as
to the Shares covered by the Stockholder Agreement and (ii) disclaims any
beneficial ownership of the shares of Issuer Common stock which are covered by
the Stockholder Agreement. To the best of Cisco's knowledge, no shares of Issuer
Common Stock are beneficially owned by any of the persons named in Schedule A.
Brett A. Shockley owns 79,575 shares of Issuer Common Stock directly,
over which shares he has sole voting and dispositive power; he also beneficially
owns 10,425 shares held by his wife as custodian for his minor children, over
<PAGE>
which shares he has shared voting and dispositive power. In addition, Mr.
Shockley has a currently exercisable option to purchase 50,000 shares of Issuer
Common Stock, which shares have not been included in this Statement.
Loren A. Singer, Jr. owns 90,000 shares of Issuer Common Stock
directly, over which shares he has sole voting and dispositive power. In
addition, Mr. Singer has a currently exercisable option to purchase 20,000
shares of Issuer Common Stock, which shares have not been included in this
Statement.
Todd A. Parenteau owns 90,000 shares of Issuer Common Stock directly,
over which shares he has sole voting and dispositive power. In addition, Mr.
Singer has a currently exercisable option to purchase 20,000 shares of Issuer
Common Stock, which shares have not been included in this Statement.
(c) None of the Reporting Persons or, to the knowledge of Cisco, any of
the persons named in Schedule A, has effected any transaction in the Issuer
Common Stock during the past 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to
Securities of the Issuer.
Other than the Merger Agreement and Subscription Agreement and the
Offer, to the knowledge of the Reporting Persons, there are no contracts,
arrangements, understandings or relationships (legal or otherwise) among the
persons named in Item 2 and between such persons and any person with respect to
any securities of the Issuer, including but not limited to transfer or voting of
any of the securities, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of profits or loss,
or the giving or withholding of proxies.
Item 7. Materials to be Filed as Exhibits.
The following documents are filed as exhibits:
1. Agreement and Plan of Merger, dated as of February 25, 2000,
by and among Spanlink Acquisition Corp., a Minnesota
corporation, Cisco Systems, Inc., a California corporation and
a subscriber for capital stock of Spanlink Acquisition Corp.
and Spanlink Communications, Inc., a Minnesota corporation.
2. Subscription Agreement, dated as of February 25, 2000, by and
among Spanlink Acquisition Corp., a Minnesota corporation and
certain stockholders of Spanlink Communications, Inc., a
Minnesota corporation.
3. Agreement dated March 8, 2000 among Cisco Systems, Inc., Brett
A. Shockley, Loren A. Singer, Jr. and Todd A. Parenteau.
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: March 8, 2000
CISCO SYSTEMS, INC.
By: /s/ Larry R. Carter
Its: Chief Financial Officer
/s/ Brett A. Shockley
Brett A. Shockley
/s/ Loren A. Singer, Jr.
Loren A. Singer, Jr.
/s/ Todd A. Parenteau
Todd A. Parenteau
<PAGE>
Schedule A
DIRECTORS AND EXECUTIVE OFFICERS OF
CISCO SYSTEMS, INC.
Present Principal
Occupation Including
Name and Title Name of Employer
- -------------------- --------------------------------
Carol Bartz Director of Cisco Systems, Inc. and Chairman and Chief
Executive Officer of Autodesk, Inc., 111 McInnis
Parkway, San Rafael, CA 94903.
Larry R. Carter Vice President, Finance and Administration, Chief
Financial Officer and Secretary of Cisco Systems, Inc.
John T. Chambers President, Chief Executive Officer and Director of Cisco
Systems, Inc.
Mary Cirillo Director of Cisco Systems, Inc. and Senior Managing
Director, Bankers Trust, 130 Liberty Street, New York,
NY 10006.
Gary Daichendt Senior Vice President, Worldwide Operations of Cisco
Systems, Inc.
Judy Estrin Senior Vice President, Business and Development and
Chief Technical Officer of Cisco Systems, Inc.
Dr. James F. Gibbons Director of Cisco Systems, Inc. and Dean, School of
Engineering, Stanford University, Stanford, CA 94305.
Edward R. Kozel Director of Cisco Systems, Inc. and Senior Vice
President of Corporate Development of Cisco Systems,
Inc.
Donald J. Listwin Executive Vice President, Service Provider and Consumer
Lines of Business of Cisco Systems, Inc.
James C. Morgan Director of Cisco Systems, Inc. and President and Chief
Executive Officer, Applied Materials, 3050 Bowers
Avenue, Santa Clara, CA 95054
John P. Morgridge Chairman of the Board of Directors of Cisco Systems,
Inc.
Mario Mazzola Senior Vice President, Enterprise Line of Business of
Cisco Systems, Inc.
Robert L. Puette Director of Cisco Systems, Inc. and President and Chief
Executive Officer of NetFRAME Systems, Inc., 1545 Barber
Lane, Milpitas, CA 95035.
Carl Redfield Vice President, Manufacturing of Cisco Systems, Inc.
Arun Sarom Director of Cisco Systems, Inc. and President and COO of
AirTouch Communications, Inc., One California Street,
San Francisco, CA 94110.
Masayoshi Son Director of Cisco Systems, Inc. and President and Chief
Executive Officer of SOFTBANK Corporation, 3-42-3
Nihonbashi-Hamacho, Chuo-Ku, Tokyo 103.
Donald T. Valentine Director of Cisco Systems, Inc. and Partner of Sequoia
Capital, 3000 Sand Hill Road, #4-280, Menlo Park, CA
94025.
Steve M. West Director of Cisco Systems, Inc. and President of Hitachi
Data Systems Corporation, 750 Central Expressway, Santa
Clara, CA 95050.
<PAGE>
SCHEDULE 13D
EXHIBIT INDEX
1. Agreement and Plan of Merger, dated as of February 25, 2000, by and
among Spanlink Acquisition Corp., a Minnesota corporation, Cisco
Systems, Inc., a California corporation and a subscriber for capital
stock of Spanlink Acquisition Corp. and Spanlink Communications, Inc.,
a Minnesota corporation. (Incorporated by reference to Exhibit C to
Schedule 14D-9 filed February 29, 2000 by Spanlink Communications,
Inc.)
2.* Subscription Agreement, dated as of February 25, 2000, by and among
Spanlink Acquisition Corp., a Minnesota corporation and certain
stockholders of Spanlink Communications, Inc., a Minnesota corporation.
3.* Agreement dated March 8, 2000 among Cisco Systems, Inc., Brett A.
Shockley, Loren A. Singer, Jr. and Todd A. Parenteau
*Filed herewith.
SUBSCRIPTION AGREEMENT
DATE: February 25, 2000
PARTIES:
Brett A. Shockley ("Shockley")
Loren A. Singer, Jr. ("Singer")
Todd A. Parenteau ("Parenteau")
Spanlink Acquisition Corp ("SAC")
RECITALS:
A. SAC has entered into an Agreement and Plan of Merger dated the date
hereof between Cisco, SAC and Spanlink Communications, Inc. (the "Merger
Agreement") pursuant to which SAC proposes to make a tender offer (as it may be
amended from time to time as permitted under the Merger Agreement, the "Offer")
to purchase all of the shares of common stock of Spanlink Communications, Inc.
(the "Company"). All capitalized terms not defined in this Agreement shall have
the meanings set forth in the Merger Agreement.
B. SAC has authorized capital stock of 20,000,000 shares of Common
Stock, no par value, (the "SAC Common Stock") and 5,000,000 undesignated shares,
from which SAC's Board of Directors has by resolution created a class of Series
A Preferred Stock (the "SAC Preferred Stock") and no shares of either SAC Common
Stock or SAC Preferred Stock are outstanding.
C. In connection with the transactions contemplated by the Merger
Agreement, Shockley, Singer and Parenteau desire to purchase shares of SAC
Common Stock according to the terms set forth herein. Shockley, Singer and
Parenteau are herein collectively referred to as the "Subscribers."
AGREEMENT:
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements contained herein, and for other valuable consideration, the receipt
and adequacy of which is hereby acknowledged, the parties hereto agree as
follows:
<PAGE>
ARTICLE I
Stock Subscription
1.1 Purchase of SAC Common Stock. At such time as SAC becomes obligated
pursuant to the Merger Agreement to purchase all shares of the Company's Common
Stock which have been tendered in response to the Offer, and immediately prior
to or concurrently with the closing of such purchase in connection with the
Offer, each of Shockley, Singer and Parenteau shall transfer to SAC that number
of shares of the Company's Common Stock set forth opposite his name in the table
below, which represents ninety (90) percent of the issued and outstanding shares
of the Company's Common Stock that he owns of record or beneficially. Such
transfer shall be effected by the delivery to SAC of certificates representing
the shares of the Company's Common Stock to be transferred together with
appropriate stock powers naming SAC as transferee. In exchange for such transfer
of Company Common Stock, SAC shall issue to each of Shockley, Singer, and
Parenteau that number of shares of SAC Common Stock set forth opposite his name
in the table below, which shall result in Shockley, Singer and Parenteau having
control of SAC following such transaction. The parties intend that no gain or
loss shall be recognized by Shockley, Singer and Parenteau in connection with
this transfer pursuant to ss.351 of the Internal Revenue Code.
Transferor Company Shares to be SAC Shares to be
Contributed to SAC Issued in Exchange
Brett A. Shockley 810,000 shares 810,000 shares
Loren A. Singer, Jr. 810,000 shares 810,000 shares
Todd A. Parenteau 810,000 shares 810,000 shares
1.2 Restriction on Tender of Shares. Each of Shockley, Singer and
Parenteau shall tender for purchase in the Offer no more than 90,000 of the
issued and outstanding shares of the Company's Common Stock of which he is the
record or beneficial owner.
1.3 Additional Director. Upon closing of the transactions contemplated
by this Article, Shockley, Singer and Parenteau, as the holders of all of the
outstanding voting stock of SAC, shall elect a designee to be named by Cisco as
an additional member of SAC's Board of Directors.
ARTICLE II
Representations and Warranties of SAC
SAC represents and warrants to the Subscribers that:
2.1 Organization and Authority. SAC is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Minnesota
and has all requisite corporate power and authority to enter into this
Subscription Agreement and to consummate the transactions contemplated hereby.
SAC has all requisite corporate power and authority to issue and sell the SAC
Common Stock and the SAC Preferred Stock contemplated hereby and otherwise to
carry out the transactions contemplated hereby.
<PAGE>
2.2 Capitalization. SAC has authorized capital stock of 20,000,000
shares of SAC Common Stock and 5,000,000 undesignated shares. The Board of
Directors of SAC has adopted a resolution creating a class of Series A Preferred
Stock but has not yet filed such resolution with the Minnesota Secretary of
State. All of the shares of SAC Common Stock issuable hereunder shall be validly
issued, fully paid and nonassessable as and when delivered by SAC in accordance
with Article I.
2.3 Valid, Binding Agreement. This Subscription Agreement is a valid
and binding agreement of SAC, enforceable against SAC in accordance with its
terms.
ARTICLE III
Representations and Warranties of the Subscribers
The Subscribers hereby represent and warrant as follows:
3.1 Access to Information. SAC has made available to the Subscribers,
for a reasonable time prior to the date hereof, an opportunity to ask questions
and receive answers concerning the terms and conditions of the Subscriber's
investment in the SAC Common Stock and the SAC Preferred Stock and to obtain any
additional information which SAC possesses or can acquire without unreasonable
effort or expense, and each Subscriber has received all additional information
requested by the Subscriber. Each Subscriber has had access to such financial
and other information as is necessary in order for the Subscriber to make a
fully-informed decision as to his or its investment in SAC Common Stock or SAC
Preferred Stock.
3.2 No Registration. The Subscribers have been advised that the shares
of SAC Common Stock and SAC Preferred Stock have not been registered under the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(the "1933 ACT") and, therefore, cannot be resold unless they are registered
under the 1933 Act or unless an exemption from registration is available.
3.3 Purchase for Investment. Each Subscriber, with respect to all the
shares of SAC Common Stock or SAC Preferred Stock to be purchased by the
Subscriber, is purchasing the SAC Common Stock or SAC Preferred Stock for such
Subscriber's own account, in each case for investment and not with a view to, or
for resale in connection with, the distribution thereof or with any present
intention of distributing or reselling any thereof.
3.4 Business and Financial Experience, Etc. Each Subscriber has such
knowledge and experience in financial and business matters that the Subscriber
is capable of evaluating the merits and risks of Subscriber's investment in SAC
Common Stock or SAC Preferred Stock and is aware that the Subscriber must bear
the economic risk of such investment for an indefinite period of time.
<PAGE>
3.5 Accredited Investor. Each Subscriber is an accredited investor as
that term is defined in Rule 501(a) of Regulation D under the 1933 Act because
each Subscriber is a director of SAC.
ARTICLE IV
Restrictions on Transfer of SAC Common Stock
Each Subscriber hereby agrees that each outstanding certificate
representing shares of SAC Common Stock and SAC Preferred Stock to be delivered
at the Closing shall bear endorsements reading substantially as follows:
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended, and may not be
transferred, sold or otherwise disposed of except while such a
registration is in effect or pursuant to an exemption from registration
under said Act.
ARTICLE V
Miscellaneous Provisions
5.1 Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Minnesota. This Agreement cannot be
changed orally and can only be changed by an instrument in writing signed by the
parties hereto.
5.2 Notices. All notices, statements, instructions, or other documents
required to be given hereunder shall be in writing and shall be given either
personally or by mailing the same in a sealed envelope, first class mail,
postage pre-paid and either certified or registered, return receipt requested
and addressed to SAC at its principal offices and the Subscribers at their
address as set forth below:
Brett A. Shockley
7125 Northland Terrace
Minneapolis, MN 55428
Loren A. Singer, Jr.
7125 Northland Terrace
Minneapolis, MN 55428
Todd A. Parenteau
7125 Northland Terrace
Minneapolis, MN 55428
Each of the Subscribers by written notice given to SAC in accordance
with this Section 5.2 may change the address to which notices, statements,
instructions or other documents are to be sent to such Subscriber. All notices,
statements, instructions, and other documents hereunder that are mailed shall be
<PAGE>
deemed to have been given on the date of mailing. Pursuant to this Agreement any
notices required to be given by any Shareholder to any other Shareholder, such
Shareholder may request from SAC a list of address of all Shareholders of SAC,
which list shall be promptly furnished to such Shareholder.
5.3 Counterparts. This Agreement and the Merger Agreement constitute
the entire Agreement between the parties relating to the subject matter hereof
and supersede all other agreements and understandings, both written and oral,
among the parties or any of them with respect to the subject matter hereof. This
Agreement maybe executed by one or more of the parties hereto and any number of
counterparts, each of which shall be deemed an original, and all such
counterparts shall constitute one and the same instrument.
5.4 Assignment. This Agreement is not assignable by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.
BRETT A. SHOCKLEY
/s/ Brett A. Shockley
LOREN A. SINGER, JR.
/s/ Loren A. Singer, Jr.
TODD A. PARENTEAU
/s/ Todd A. Parenteau
SPANLINK ACQUISITION CORP.
/s/ Brett A. Shockley
By: Brett A. Shockley,
Chief Executive Officer
EXHIBIT 3
AGREEMENT
This will confirm the agreement by and among all the undersigned that
the Schedule 13D filed on or about this date with respect to the beneficial
ownership of the undersigned of shares of the Common Stock of Spanlink
Communications, Inc. is being filed by and on behalf of each of the persons
named below. This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together will constitute one
and the same instrument.
March 8, 2000
CISCO SYSTEMS, INC.
By: /s/ Judith Estrin
Its: Chief Technology Officer
/s/ Brett A. Shockley
Brett A. Shockley
/s/ Loren A. Singer, Jr.
Loren A. Singer, Jr.
/s/ Todd A. Parenteau
Todd A. Parenteau
