UNITED STAES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
DATA SYSTEMS NETWORK CORPORATION
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(Name of Issuer)
Common Stock, par value $.01 per share
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(Title of Class of Securities)
237891-10-6
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(CUSIP Number)
Peter W. Rothberg, Esq.
Nixon Peabody LLP
437 Madison Avenue
NEW YORK, NEW YORK 10022-7001
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 18, 2000
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(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement of Schedule 13G to report
the acquisition which is the subject of the Schedule 13D, and is filing this
schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d(g), check the
following box [ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Section 240.13.d-7(b) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filed out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
SCHEDULE 13D
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CUSIP No.237891-10-6 Page 2 of 8 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
TekInsight.Com, Inc.
IRS Employer Identification Number 95-4228470
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [ ]
(b) [ X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (See Instructions)
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of Delaware
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NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 1,054,556*
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,054,556*
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(See Instructions)
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.0%
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14 TYPE OF REPORTING PERSON (See Instructions)
CO
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*Damon Testaverde and Brian D. Bookmeier, members of the Board of Directors of
TekInsight.Com, Inc. ("Tek"), were each named as proxy to vote certain shares of
the common stock of Data Systems Network Corporation ("DSNC") with respect to
certain matters relating to the merger of DSNC with and into a wholly-owned
subsidiary of Tek.
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<PAGE>
SCDEULE 13D
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CUSIP No. 237891-10-6 Page 3 of 8 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Damon Testaverde
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [ ]
(b) [ X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (See Instructions)
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 1,054,556*
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,054,556*
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(See Instructions)
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.0%
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14 TYPE OF REPORTING PERSON (See Instructions)
IN
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*Damon Testaverde and Brian D. Bookmeier, members of the Board of Directors of
TekInsight.Com, Inc. ("Tek"), were each named as proxy to vote certain shares of
the common stock of Data Systems Network Corporation ("DSNC") with respect to
certain matters relating to the merger of DSNC with and into a wholly-owned
subsidiary of Tek.
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<PAGE>
SCHEDULE 13D
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CUSIP No. 237891-10-6 Page 4 of 8 Pages
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- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brian D. Bookmeier
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [ ]
(b) [ X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (See Instructions)
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) [ ]
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY --------------------------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 1,054,556*
REPORTING --------------------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 0
--------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,054,556*
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(See Instructions)
[ ]
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
19.0%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON (See Instructions)
CO
- --------------------------------------------------------------------------------
*Damon Testaverde and Brian D. Bookmeier, members of the Board of Directors of
TekInsight.Com, Inc. ("Tek"), were each named as proxy to vote certain shares of
the common stock of Data Systems Network Corporation ("DSNC") with respect to
certain matters relating to the merger of DSNC with and into a wholly-owned
subsidiary of Tek.
-4-
<PAGE>
ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to shares of the Common Stock, par value $.01
per share (the "Common Stock"), of Data Systems Network Corporation (the
"Issuer" or "DSNC"). The Issuer's principal executive office is located at 34705
West 12 Mile Road, Suite 300, Farmington Hills, Michigan 48331.
ITEM 2. IDENTITY AND BACKGROUND
This Statement is being filed by TekInsight.Com, Inc. ("Tek"), Damon
Testaverde and Brian D. Bookmeier in connection with (a) an Agreement and Plan
of Merger, dated as of February 18, 2000 (the "Merger Agreement"), by and among
Tek, its wholly owned subsidiary Astratek, Inc. ("Astratek"), and DSNC pursuant
to which DSNC will merge with and into Astratek, and (b)(i) the Voting
Agreement, dated as of February 18, 2000 (the "Voting Agreement"), among Tek,
Astratek, DSNC, Michael W. Grieves and Gregory D. Cocke (the "DSNC
Stockholders"), (ii) two Irrevocable Proxies, dated as of February 18, 2000 (the
"Proxies"), by each of the DSNC Stockholders in favor of Tek and each of Damon
Testaverde and Brian D. Bookmeier (the "Proxyholders"), and (iii) the Affiliate
Agreement, dated as of February 18, 2000 (the "Affiliate Agreement"), among Tek,
DSNC and each of the DSNC Stockholders, which grant each of the Proxyholders the
right, as proxy (with full power of substitution), for and in the name, place
and stead of the DSNC Stockholders, to vote such Stockholders' shares of Common
Stock at any special meeting of the stockholders of DSNC, and any adjournments
thereof, called for the purpose of adopting and approving the Merger Agreement,
and to execute any consents in lieu thereof. The Merger Agreement is
incorporated by reference as an exhibit to this Schedule 13D. The Voting
Agreement, the two Proxies and the Affiliate Agreement are filed as exhibits to,
and are incorporated by reference in, this Schedule 13D.
Tek is organized as a corporation under the laws of the State of
Delaware, and its principal business address is 5 Hanover Square, 24th Floor,
New York, New York 10004. Tek is a technology development and service company,
with a specialization in Internet, networking and e-commerce solutions. The
names, business addresses, principal occupations and citizenship of the
directors and executive officers of Tek are set forth in ANNEX A hereto and are
incorporated herein by reference.
Damon Testaverde is President of The Damon Group and a member of the
Board of Directors of Tek. His business address is 580 Oakdale Street, Staten
Island, New York 10312. Mr. Testaverde is a citizen of the United States.
Brian D. Bookmeier is Vice-President of Seven Sons, Inc., d/b/a Las
Vegas Gold & Tennis, and a member of the Board of Directors of Tek. His business
address is 42663 Ford Road, Canton, Michigan 48187. Mr. Bookmeier is a citizen
of the United States.
None of Tek, the Proxyholders or Tek's directors or executive officers
has, during the last five years, been (a) convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors), or (b) a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
as a result of which he, she or it is or was subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws on finding any violation
with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
In consideration of and as a condition to Tek entering into the Merger
Agreement, the Proxyholders have each been appointed proxy (with full power of
substitution), for and in the name, place and stead of the DSNC Stockholders, to
vote such Stockholders' shares of Common Stock at any special meeting of the
stockholders of DSNC, and any adjournments thereof, called for the purpose of
adopting and approving the Merger Agreement, and to execute any consents in lieu
thereof.
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<PAGE>
ITEM 4. PURPOSE OF TRANSACTION
On February 18, 2000, Tek, Astratek and DSNC entered into the Merger
Agreement pursuant to which DSNC will merge with and into Astratek. Under the
terms of the Merger Agreement, the Certificate of Incorporation, By-laws,
officers and directors of Astratek shall, following consummation of the
transactions contemplated by the Merger Agreement, continue to be the
Certificate of Incorporation, By-laws, officers and directors of the surviving
corporation. DSNC stockholders will receive a varying purchase price for their
shares of Common Stock which will equal, in the aggregate, $12,500,000 if the
market price of the Common Stock (the "Market Price") at the time of the closing
is less than $5.00 per share, $16,000,000 if the Market Price is between $5.00
and $7.00 per share, and $18,000,000 if the Market Price is over $7.00 per
share. The purchase price will be delivered to DSNC's stockholders through the
distribution of a number of shares of a new class of Tek Convertible Preferred
Stock, par value $.01 per share (the "Convertible Preferred Stock"), proposed to
be listed on the Nasdaq Small Cap market, with the number of such shares to be
found by dividing the applicable purchase price by the Market Price at the time
of the closing. The Merger Agreement is subject to approval by the stockholders
of each of DSNC and Tek, acceptance by Nasdaq for the listing of the Convertible
Preferred Stock, and additional customary closing conditions. The Merger
Agreement may be terminated under certain circumstances, including if (a) DSNC
or Tek does not obtain the required stockholder and/or Nasdaq approval, (b) the
merger is not consummated by June 30, 2000, (c) the Market Price falls below
$2.00 per share, (d) Tek's Board of Directors accepts or recommends a superior
proposal, or (e) a tender or exchange offer relating to DSNC securities is
accepted by more than 50% of the outstanding shares of Common Stock. The terms
of the Merger Agreement are incorporated herein by reference.
Tek, DSNC and each of the DSNC Stockholders entered into the Voting
Agreement as a condition of Tek entering into the Merger Agreement. Pursuant to
the terms of the Voting Agreement, the DSNC Stockholders have each agreed to
vote all of their shares of DSNC Common Stock, including shares acquired after
the date thereof, (a) in favor of the adoption and approval of the Merger
Agreement and the transactions contemplated by the Merger Agreement, (b) against
any action or agreement that would compete with, impede, interfere with or
attempt to discourage the Merger Agreement or inhibit the timely consummation of
the Merger Agreement or the transactions contemplated by the Merger Agreement,
and (c) against any other merger, consolidation, business combination,
reorganization, recapitalization, liquidation or sale of any material assets of
DSNC.
Each of the DSNC Stockholders executed a Proxy in favor of each of the
Proxyholders pursuant to which each of the DSNC Stockholders appointed each of
the Proxyholders to act as proxy (with full power of substitution), for and in
the name, place and stead of the DSNC Stockholders, to vote their DSNC Common
Stock at any special meeting called for the purpose of adopting and approving
the Merger Agreement and to execute any consents in lieu thereof. The Proxies
will terminate upon the termination of the Merger Agreement.
Tek, DSNC and each of the DSNC Stockholders executed the Affiliate
Agreement pursuant to which each DSNC Stockholder agreed to certain limitations
on resales of their shares of DSNC Common Stock. The Affiliate Agreement will
terminate upon the termination of the Merger Agreement.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
<TABLE>
<CAPTION>
Shares Owned Beneficially Power to Vote Power to Direct Disposition
REPORTING PERSON CLASS NUMBER % OF CLASS SOLE SHARED SOLE SHARED
- ---------------- ----- ------ ---------- ---- ------ ---- ------
<S> <C> <C> <C> <C> <C> <C> <C>
TekInsight.Com, Inc. (1) Common 1,054,556 19.0% 0 1,054,556 0 0
Damon Testaverde (1) Common 1,054,556 19.0% 0 1,054,556 0 0
Brian D. Bookmeier (1) Common 1,054,556 19.0% 0 1,054,556 0 0
</TABLE>
-6-
<PAGE>
(1) Tek and each of the Proxyholders were each named as proxy to vote
certain shares of the DSNC Common Stock with respect to certain matters
relating to the merger of DSNC with and into Astratek.
The percentages of ownership set forth in this Schedule 13D are based
upon 5,509,224 shares of the Issuer's Common Stock outstanding as of December
31, 1999
Each of Tek and each Proxyholder declares that the filing of this
Schedule 13D shall not be construed as an admission that such person is, for the
purposes of Section 13(d) of the Act, the beneficial owner of any DSNC Common
Stock, as to which he or it disclaims beneficial ownership.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER
Other than the Merger Agreement, the Voting Agreement, the Proxies and
the Affiliate Agreement described in response to Item 4 (which response is
incorporated in this Item 6 by reference) and the transactions contemplated
thereby, there are no contracts, arrangements, understandings or relationships
among the persons named in Item 2 or between such persons and any other person
with respect to the DSNC Common Stock or, to the best knowledge of Tek, among
any of Tek's executive officers and directors and any other person, with respect
to the DSNC Common Stock.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Joint Filing Agreement, dated as of March 8, 2000, among Tek and
each of the Proxyholders.
2. Agreement and Plan of Merger, dated as of February 18, 2000, among
Tek, Astratek and DSNC - incorporated herein by reference to EXHIBIT 2.1 of
Tek's Current Report on Form 8-K as filed on February 29, 2000.
3. Voting Agreement, dated as of February 18, 2000, among Tek, DSNC and
each of the DSNC Stockholders.
4. Irrevocable Proxy, dated as of February 18, 2000, by Michael W.
Grieves in favor of Tek and each of the Proxyholders.
5. Irrevocable Proxy, dated as of February 18, 2000, by Gregory D.
Cocke in favor of Tek and each of the Proxyholders.
6. Affiliate Agreement, dated as of February 18, 2000, among Tek, DSNC
and each of the DSNC Stockholders.
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<PAGE>
SIGNATURE
After reasonable inquiry and to the best of the undersigned's knowledge
and belief, each of the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Date: March 8, 2000 /s/Damon Testaverde
-----------------------
Damon Testaverde
Date: March 8, 2000 /s/Brian D. Bookmeier
-----------------------
Brian D. Bookmeier
Date: March 8, 2000 TEKINSIGHT.COM, INC.
By:/s/Michael Niles
---------------------
Michael Niles
Secretary
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<PAGE>
Schedule A
EXECUTIVE OFFICERS OF TEKINSIGHT.COM, INC. (all with business addresses at 5
Hanover Square, 24th Floor, New York, New York 10004):
Name Citizen Title
Stephen Ross United States President and Chief Executive Officer
Alexander Kalpaxis United States Execute Vice President and Chief
Technology Officer
Michael Niles United States Secretary
NON-EXECUTIVE DIRECTORS OF TEKINSIGHT.COM, INC. (all with business addresses at
5 Hanover Square, 24th Floor, New York, New York 10004):
Damon Testaverde United States
Brian D. Bookmeier United States
James Linesch United States
Alexander Kalpaxis United States
Exhibit 10.1
Joint Filing Agreement
In accordance with Rule 13d-1(k) promulgated under the Securities
Exchange Act of 1934, as amended, each of the persons named below agrees to the
joint filing of this Schedule 13D, including amendments thereto, with respect to
the shares of Common Stock, par value $.01 per share, of Data Systems Network
Corporation, and further agrees that this Joint Filing Agreement be filed with
the Securities and Exchange Commission as an exhibit to such filing; PROVIDED,
HOWEVER, that no person shall be responsible for the completeness or accuracy of
the information concerning the other persons making the filing, unless such
person knows or has reason to believe such information is inaccurate (as
provided in Rule 13d-1(k)(1)(ii)). This Joint Filing Agreement may be executed
in one or more counterparts, all of which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the persons named below have executed this Joint
Filing Agreement on the dates set forth below.
Date: March 8, 2000 /s/Damon Testaverde
----------------------
Damon Testaverde
Date: March 8, 2000 /s/Brian D. Bookmeier
----------------------
Brian D. Bookmeier
Date: March 8, 2000 TEKINSIGHT.COM, INC.
By:/s/Michael Niles
--------------------
Michael Niles
Secretary
Exhibit 10.3
VOTING AGREEMENT
This VOTING AGREEMENT (the "Agreement"), dated as of February 18, 2000,
among the undersigned stockholders (the "Stockholders") of Data Systems Network
Corporation, a Michigan corporation ("DSNC"), Astratek, Inc., a New York
corporation ("Astratek"), and TekInsight.Com, Inc., a Delaware corporation
("Tek").
STATEMENT OF PURPOSE
A. Concurrently with the execution of this Agreement, DSNC, Astratek
and Tek have entered into an Agreement and Plan of Merger (as the same may be
amended from time to time, the "Merger Agreement");
B. Each Stockholder is the record and beneficial owner of the number of
shares of DSNC's Common Stock set forth opposite its name on SCHEDULE 1 attached
hereto (the "Shares")
C. The approval of the Merger Agreement by the shareholders of DSNC is
a condition to the consummation of the Merger;
D. In order to induce Astratek and Tek to enter into the Merger
Agreement, the Stockholders wish to agree (i) to vote the Shares and any other
such shares of capital stock of DSNC owned by them so as to facilitate
consummation of the transactions contemplated by the Merger Agreement, (ii) not
to transfer or otherwise dispose of any of the Shares, or any other shares of
capital stock of DSNC acquired hereafter and prior to the Expiration Date (as
defined below) and (iii) to deliver an irrevocable proxy to vote the Shares to
Tek.
NOW, THEREFORE, for good and valuable consideration, the receipt,
sufficiency and adequacy of which is hereby acknowledged, the parties hereto
agree as follows:
1. REPRESENTATIONS OF STOCKHOLDERS. Each of the Stockholders represents
and warrants (each as to himself or itself) to Astratek and Tek that (a) except
for shares pledged to lending institutions in connection with bona fide loan
transactions, in which case all voting rights relating to such shares are
retained by the Stockholder, such Stockholder lawfully owns the Shares set forth
opposite such Stockholder's name on SCHEDULE 1 free and clear of all liens,
claims, charges, security interests or other encumbrances and, except for this
Agreement, there are no options, warrants or other rights, agreements,
arrangements or commitments of any character to which such Stockholder is a
party relating to the pledge, disposition or voting of any shares of capital
stock of DSNC and there are no voting trusts or voting agreements with respect
to such Shares, (b) such Stockholder does not own any shares of Common Stock
other than such Shares and does not have any options (other than employee stock
options), warrants or other rights to acquire any additional shares of capital
stock of DSNC or any security exercisable for or convertible into shares of
capitol stock of DSNC, and (c) such Stockholder has full power and authority to
enter into, execute and deliver this Agreement and to perform fully such
<PAGE>
Stockholder's obligations hereunder. This Agreement has been duly executed and
delivered and constitutes the legal, valid and binding obligation of such
Stockholder, enforceable in accordance with its terms.
2. AGREEMENT TO VOTE SHARES. Each of the Stockholders agrees during the
term of this Agreement to vote such Stockholder's Shares and any New Shares (as
defined in Section 6 hereof), and to cause any holder of record of such Shares
or New Shares to vote (a) in favor of adoption and approval of the Merger
Agreement, all agreements related to the Merger Agreement and any actions
related thereto at any meeting of the stockholders of DSNC at which such matters
are considered and at every adjournment thereof, (b) against any action or
agreement that would compete with, impede, interfere with or attempt (i) to
discourage the Merger Agreement, all agreements related to the Merger Agreement
and any actions related thereto or (ii) inhibit the timely consummation of the
Merger Agreement, all agreements related to the Merger Agreement and any actions
related thereto, and (c) against any other merger, consolidation, business
combination, reorganization, recapitalization, liquidation or sale or transfer
of any material assets of DSNC or its subsidiaries; PROVIDED, that the foregoing
clauses (b) and (c) shall not restrict any director of DSNC from taking any
action as a director that such director reasonably believes after consultation
with outside counsel is required to satisfy such director's fiduciary duty to
stockholders of DSNC. Each Stockholder agrees to deliver to Tek upon request a
proxy substantially in the form attached hereto as SCHEDULE 2, which proxy shall
be irrevocable during the term of this Agreement to the extent permitted under
applicable law.
3. NO VOTING TRUSTS. During the term of this Agreement, each of the
Stockholders agrees that such Stockholder will not, nor will such Stockholder
permit any entity under such Stockholder's control, to deposit any of such
Stockholder's Shares in a voting trust or subject any of their Shares to any
arrangement with respect to the voting of such Shares other than agreements
entered into with Tek.
4. NO PROXY SOLICITATIONS. During the term of this Agreement, each of
the Stockholders agrees that such Stockholder will not, nor will such
Stockholder permit any entity under such Stockholder's control to, (a) solicit
proxies or become a "participant" in a "solicitation," (as such terms are
defined in Regulation 14A under the Securities Exchange Act of 1934 (the "1934
Act") in opposition to or competition with the Merger Agreement, all agreements
related to the Merger Agreement and any actions related thereto, (b) otherwise
encourage or assist any party in taking or planning any action which would
compete with, impede, interfere with or attempt to discourage the Merger
Agreement, all agreements related to the Merger Agreement and any actions
related thereto or inhibit the timely consummation of the Merger Agreement, all
agreements related to the Merger Agreement and any actions related thereto, (c)
directly or indirectly encourage, initiate or cooperate in a stockholders' vote
or action by consent of DSNC's stockholders in opposition to or in competition
with the Merger Agreement, all agreements related to the Merger Agreement and
any actions related thereto, or (d) become a member of a "group" (as such term
is used in Section 13(d) of the 1934 Act) with respect to any voting securities
of DSNC for the purpose of opposing, competing with or impeding the consummation
of the Merger Agreement, all agreements related to the Merger Agreement and any
actions related thereto; PROVIDED, that the foregoing shall not restrict any
-2-
<PAGE>
director of DSNC from taking any action as a director that such director
reasonably believed after consultation with outside counsel is required to
satisfy such director's fiduciary duty to stockholders of DSNC.
5. TRANSFER AND ENCUMBRANCE. On or after the date hereof and during the
term of this Agreement, each of the Stockholders agrees not to transfer, sell,
offer, exchange, pledge or otherwise dispose of or encumber any of such
Stockholder's Shares or New Shares (other than the disposition in market
transactions of New Shares acquired upon exercise of any employee stock options,
on notice to Tek, as necessary to pay the tax liabilities incurred upon exercise
of any such options).
6. ADDITIONAL PURCHASES. Each of the Stockholders agrees that such
Stockholder will not purchase or otherwise acquire beneficial ownership of any
shares of DSNC Common Stock after the execution of this Agreement ("New
Shares"), nor will any Stockholder voluntarily acquire the right to vote or
share in the voting of any shares of DSNC Common Stock other than the Shares,
unless such Stockholder agrees to deliver to Tek immediately after such purchase
or acquisition an irrevocable proxy substantially in the form attached hereto as
SCHEDULE 2 with respect to such New Shares. Each of the Stockholders also
severally agrees that any New Shares acquired or purchased by him or her shall
be subject to the terms of this Agreement to the same extent as if they
constituted Shares.
7. SECURITIES ACT COVENANTS AND REPRESENTATIONS.
(a) Each Stockholder has been advised that the offering, sale and
delivery of the Common Stock pursuant to the Merger Agreement will be registered
under the Securities Act on a Registration Statement on Form S-4. Each
Stockholder has also been advised, however, that to the extent such Stockholder
is considered an "affiliate" of DSNC at the time the Merger Agreement is
submitted to a vote of the stockholders of DSNC, any public offering or sale by
such Stockholder of any shares of the Tek Preferred Stock received by
Stockholder in the Merger will, under current law, require either (i) the
further registration under the Securities Act of any shares of the Common Stock
to be sold by Stockholder, (ii) compliance with Rule 145 promulgated by the SEC
under the Securities Act or (iii) the availability of another exemption from
such registration under the Securities Act.
(b) Each Stockholder has read this Agreement and the Merger
Agreement and has discussed their requirements and other applicable limitations
upon such Stockholder's ability to sell, transfer or otherwise dispose of shares
of the Tek Preferred Stock with such Stockholder's counsel or counsel for DSNC,
to the extent such Stockholder believed necessary.
(c) Each Stockholder also understands that stop transfer
instructions will be given to DSNC's transfer agent with respect to the Tek
Preferred Stock and that a legend will be placed on the certificates for the Tek
Preferred Stock issued to such Stockholder, or any substitutions therefor, to
the extent such Stockholder is considered an "Affiliate" of DSNC at the time the
Merger Agreement is submitted to a vote of the shareholders of DSNC
-3-
<PAGE>
8. SPECIFIC PERFORMANCE. Each party hereto acknowledges that it will be
impossible to measure in money the damage to the other party if a party hereto
fails to comply with any of the obligations imposed by this Agreement, that
every such obligation is material and that, in the event of any such failure,
the other party will not have an adequate remedy at law or damages. Accordingly,
each party hereto agrees that injunctive relief or other equitable remedy, in
addition to remedies at law or damages, is the appropriate remedy for any such
failure and will not oppose the granting of such relief on the basis that the
other party has an adequate remedy at law. Each party hereto agrees that it will
not seek, and agrees to waive any requirement for, the securing or posting of a
bond in connection with any other party's seeking or obtaining such equitable
relief.
9. ENTIRE AGREEMENT. This Agreement supersedes all prior agreements,
written or oral, among the parties hereto with respect to the subject matter
hereof and contains the entire agreement among the parties with respect to the
subject matter hereof. This Agreement may not be amended, supplemented or
modified, and no provisions hereof may be modified or waived, except by an
instrument in writing signed by all the parties hereto. No waiver of any
provisions hereof by any party shall be deemed a waiver of any other provisions
hereof by any such party, nor shall any such waiver be deemed a continuing
waiver of any provision hereof by such party.
10. NOTICES. All notices, requests, claims, demands or other
communications hereunder shall be in writing and shall be deemed given when
delivered personally, upon receipt of a transmission confirmation if sent by
telecopy or like transmission and on the next business day when sent by Federal
Express, Express Mail or other reputable overnight comer service to the parties
at the following addresses (or at such other address for a party as shall be
specified by like notice):
(a) If to Astratek and Tek:
TekInsight.Com, Inc.
5 Hanover Square, 24th Floor
New York, NY 10004
Telephone: (212) 271-8511
Telecopy: (212) 271-8083
Attention: Alexander Kalpaxis, Chief Technology Officer
With a copy to:
Nixon Peabody, LLP
437 Madison Avenue
New York, NY 10022
Telephone: (212) 940-3106
Telecopy: (212) 940-3111
Attention: Peter W. Rothberg, Esq.
(b) If to a Stockholder, to the address or telecopy number set
forth for such Stockholder on the signature page hereof:
-4-
<PAGE>
(c) If to DSNC:
Data Systems Network Corporation
34705 W. 12 Mile Road, Suite 300
Farmington Hills, MI 48331
Telephone: (248) 489-7117
Telecopy: (248) 489-1007
Attention: Michael W. Grieves
With a copy to:
Bodmau, Longley & Dahling LL
100 Renaissance Center, 34th Floor
Detroit, MI 48243
Telephone: (313) 393-7597
Telecopy: (313) 393-7579
Attention: Robert I. Diehl, Jr.
11. MISCELLANEOUS.
(a) GOVERNING LAW. This Agreement shall be deemed a contract made
under, and for all purposes shall be construed in accordance with, the laws of
the State of New York, without reference to principles of conflicts of law.
(b) SEVERABILITY. It any provision of this Agreement or the
application of such provision to any person or circumstances shall be held
invalid or unenforceable by a court of competent jurisdiction, such provision or
application shall be unenforceable only to the extent of such invalidity or
unenforceability and the remainder of the provision held invalid or
unenforceable and the application of such provision to persons or circumstances,
other than the party as to which it is held invalid, and the remainder of this
Agreement, shall not be affected.
(c) COUNTERPARTS. This Agreement may be executed by facsimile
in one or more counterparts, each of which shall be deemed to be an original but
all of which together shall constitute one and the same instrument.
(d) TERMINATION. This Agreement shall terminate upon the earliest to
occur of (i) the conclusion of DSNC's meeting of shareholders held for the
purpose of voting on the Merger Agreement (or, if adjourned, the conclusion of
any subsequent reconvened meeting held for such purpose), and (ii) the date on
which the Merger Agreement is terminated in accordance with its terms.
(e) ADDITIONAL DOCUMENTATION. Each party hereto shall execute and
deliver such additional documents as may be necessary or desirable to effect the
transactions contemplated by this Agreement.
-5-
<PAGE>
(f) HEADINGS. All Section heading hereto are for convenience of
reference any and are not part of this Agreement, and no construction or
reference shall be derived therefrom.
(g) BINDING EFFECT. The obligations of the Stockholders set forth in
this Agreement shall not be effective or binding upon any Stockholder until
after such time as the Merger Agreement is executed and delivered by DSNC,
Astratek and Tek, and the parties agree that there is not and has not been any
other agreement, arrangement or understanding between the parties hereto with
respect to the matters set forth herein. The obligations of each Stockholder who
executes and delivers this Agreement shall be effective and binding regardless
of the failure of other Stockholders to execute and deliver this Agreement. This
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective successors and assigns.
(h) EXPENSES. The parties hereto shall each bear its own expenses
incurred in connection with this Agreement and the transactions contemplated
hereby, except that in the event of a dispute concerning the terms or
enforcement of this Agreement, the prevailing party in any such dispute shall be
entitled to reimbursement of reasonable legal fees and disbursements from the
other party or parties to such dispute.
(i) CAPITALIZED TERMS. All capitalized terms that are not otherwise
defined in this Agreement shall have the meanings ascribed thereto in the Merger
Agreement.
[The remainder of this page is intentionally left blank.]
-6-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first written above.
DATA SYSTEMS NETWORK CORPORATION
ATTEST:
By:/s/Michael W. Grieves
---------------------- ----------------------------
, Secretary Name: Michael W. Grieves
-------------- --------------------------
[Corporate Seal] Title: President
---------------------------
TEKINSIGHT.COM, INC.
ATTEST:
/s/Michael Niles By:/s/Alexander Kalpaxis
---------------------- ------------------------------
Michael Niles, Secretary Name: Alexander Kalpaxis
------------- ----------------------------
[Corporate Seal] Title: Chief Technology Officer
---------------------------
ASTRATEK, INC.
ATTEST:
/s/Michael Niles By:/s/Alexander Kalpaxis
---------------------- ------------------------------
Michael Niles, Secretary Name: Alexander Kalpaxis
----------- ----------------------------
[Corporate Seal] Title: President
---------------------------
STOCKHOLDERS:
/s/Michael W. Grieves
---------------------------------
Name: Michael W. Grieves
---------------------------------
Name: Richard R. Burkhart
/s/Gregory D. Cocke
---------------------------------
Name: Gregory D. Cocke
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<PAGE>
Schedule 1
Shares of DSNC
COMMON STOCK
Michael W. Grieves 707,500
Richard R. Burkhart 140,625
Gregory D. Cocke 361,250
-8-
<PAGE>
Schedule 2
Irrevocable Proxy
-9-
<PAGE>
IRREVOCABLE PROXY
THIS IRREVOCABLE PROXY is made by the undersigned stockholder (the
"Stockholder") of Data Systems Network Corporation, a Michigan corporation
("DSNC") in favor of TekInsight.Com, Inc., a Delaware corporation ("Tek"), and
is dated as of February ____, 2000.
WHEREAS, pursuant to an Agreement and Plan of Merger (the "Merger
Agreement"), dated as of the date hereof, among DSNC, Tek, Astratek, Inc., a New
York corporation ("Astratek"), Tek shall acquire DSNC by virtue of the merger of
DSNC with and into Astratek, a wholly-owned subsidiary of Tek (the "Merger").
WHEREAS, pursuant to a Voting Agreement, dated the date hereof (the
"Voting Agreement"), the Stockholder has agreed to vote the Shares (as defined
in the Voting Agreement) and any other shares of capital stock of DSNC owned by
him and which he may have acquired after the date of the Voting Agreement (the
"New Shares," and collectively with the Shares, the "Voting Shares") so as to
facilitate the consummation of the transactions contemplated by the Merger
Agreement.
WHEREAS, the Stockholder currently owns ________ shares of DSNC's
Common Stock, par value $.01 per share; and
WHEREAS, the execution and delivery of this irrevocable proxy is a
condition precedent to the execution and delivery of the Merger Agreement by Tek
and Astratek.
NOW, THEREFORE, effective upon the execution and delivery of the Merger
Agreement, the Stockholder does hereby irrevocably constitute and appoint BRIAN
BOOKMEIER AND DAMON TESTAVERDE, OR EITHER OF THEM ACTING SINGLY, as his proxy,
with full power of substitution, for and in his name, place, and stead, to
attend any special meeting of the stockholders of DSNC, and any adjournments
thereof, called for the purpose of adopting and approving the Merger Agreement,
and to vote at such special meeting or adjournment thereof all of the Voting
Shares which the Stockholder would be entitled to vote if personally present, in
accordance with Section 2 of the Voting Agreement and with the authority to
execute consents in lieu thereof and waivers of notice in connection therewith;
PROVIDED, HOWEVER, that this irrevocable proxy automatically shall terminate
simultaneously with the termination of the Merger Agreement.
Except as herein stated, this proxy is irrevocable. Any proxies
heretofore given by the Stockholder to any person are hereby revoked.
----------------------------
Stockholder
Exhibit 10.4
IRREVOCABLE PROXY
THIS IRREVOCABLE PROXY is made by the undersigned stockholder (the
"Stockholder") of Data Systems Network Corporation, a Michigan corporation
("DSNC") in favor of TekInsight.Com, Inc., a Delaware corporation ("Tek"), and
is dated as of February 18, 2000.
WHEREAS, pursuant to an Agreement and Plan of Merger (the "Merger
Agreement"), dated as of the date hereof, among DSNC, Tek, Astratek, Inc., a New
York corporation ("Astratek"), Tek shall acquire DSNC by virtue of the merger of
DSNC with and into Astratek, a wholly-owned subsidiary of Tek (the "Merger").
WHEREAS, pursuant to a Voting Agreement, dated the date hereof (the
"Voting Agreement"), the Stockholder has agreed to vote the Shares (as defined
in the Voting Agreement) and any other shares of capital stock of DSNC owned by
him and which he may have acquired after the date of the Voting Agreement (the
"New Shares," and collectively with the Shares, the "Voting Shares") so as to
facilitate the consummation of the transactions contemplated by the Merger
Agreement.
WHEREAS, the Stockholder currently owns 693,306 shares of DSNC's
Common Stock, par value $.01 per share; and
WHEREAS, the execution and delivery of this irrevocable proxy is a
condition precedent to the execution and delivery of the Merger Agreement by Tek
and Astratek.
NOW, THEREFORE, effective upon the execution and delivery of the Merger
Agreement, the Stockholder does hereby irrevocably constitute and appoint BRIAN
BOOKMEIER AND DAMON TESTAVERDE, OR EITHER OF THEM ACTING SINGLY, as his proxy,
with full power of substitution, for and in his name, place, and stead, to
attend any special meeting of the stockholders of DSNC, and any adjournments
thereof, called for the purpose of adopting and approving the Merger Agreement,
and to vote at such special meeting or adjournment thereof all of the Voting
Shares which the Stockholder would be entitled to vote if personally present, in
accordance with Section 2 of the Voting Agreement and with the authority to
execute consents in lieu thereof and waivers of notice in connection therewith;
PROVIDED, HOWEVER, that this irrevocable proxy automatically shall terminate
simultaneously with the termination of the Merger Agreement.
Except as herein stated, this proxy is irrevocable. Any proxies
heretofore given by the Stockholder to any person are hereby revoked.
/s/Michael W. Grieves
----------------------------
Stockholder
Exhibit 10.5
IRREVOCABLE PROXY
THIS IRREVOCABLE PROXY is made by the undersigned stockholder (the
"Stockholder") of Data Systems Network Corporation, a Michigan corporation
("DSNC") in favor of TekInsight.Com, Inc., a Delaware corporation ("Tek"), and
is dated as of February 18, 2000.
WHEREAS, pursuant to an Agreement and Plan of Merger (the "Merger
Agreement"), dated as of the date hereof, among DSNC, Tek, Astratek, Inc., a New
York corporation ("Astratek"), Tek shall acquire DSNC by virtue of the merger of
DSNC with and into Astratek, a wholly-owned subsidiary of Tek (the "Merger").
WHEREAS, pursuant to a Voting Agreement, dated the date hereof (the
"Voting Agreement"), the Stockholder has agreed to vote the Shares (as defined
in the Voting Agreement) and any other shares of capital stock of DSNC owned by
him and which he may have acquired after the date of the Voting Agreement (the
"New Shares," and collectively with the Shares, the "Voting Shares") so as to
facilitate the consummation of the transactions contemplated by the Merger
Agreement.
WHEREAS, the Stockholder currently owns 361,250 shares of DSNC's
Common Stock, par value $.01 per share; and
WHEREAS, the execution and delivery of this irrevocable proxy is a
condition precedent to the execution and delivery of the Merger Agreement by Tek
and Astratek.
NOW, THEREFORE, effective upon the execution and delivery of the Merger
Agreement, the Stockholder does hereby irrevocably constitute and appoint BRIAN
BOOKMEIER AND DAMON TESTAVERDE, OR EITHER OF THEM ACTING SINGLY, as his proxy,
with full power of substitution, for and in his name, place, and stead, to
attend any special meeting of the stockholders of DSNC, and any adjournments
thereof, called for the purpose of adopting and approving the Merger Agreement,
and to vote at such special meeting or adjournment thereof all of the Voting
Shares which the Stockholder would be entitled to vote if personally present, in
accordance with Section 2 of the Voting Agreement and with the authority to
execute consents in lieu thereof and waivers of notice in connection therewith;
PROVIDED, HOWEVER, that this irrevocable proxy automatically shall terminate
simultaneously with the termination of the Merger Agreement.
Except as herein stated, this proxy is irrevocable. Any proxies
heretofore given by the Stockholder to any person are hereby revoked.
/s/Gregory D. Cocke
----------------------------
Stockholder
Exhibit 10.6
AFFILIATE AGREEMENT
THIS AFFILIATE AGREEMENT (the "AGREEMENT") is entered into as of this
18th day of February, 2000 by and between TekInsight.Com, Inc. a Delaware
corporation ("TEK"), and the undersigned stockholder ("STOCKHOLDER") of DATA
SYSTEMS NETWORK CORPORATION, a Michigan corporation ("DSNC").
This Agreement is entered into in connection with that certain
Agreement and Plan of Merger, dated as of February 18, 2000 (the "MERGER
AGREEMENT"), among Tek, Astratek, Inc., a New York corporation and a
wholly-owned subsidiary of Tek ("MERGER SUB"), and DSNC. The Merger Agreement
provides for the merger (the "MERGER") of DSNC with and into Merger Sub in a
transaction in which issued and outstanding shares of common stock, $.01 par
value per share, of DSNC (the "DSNC COMMON STOCK") will be converted into shares
of preferred stock, $.0001 par value per share, of Tek (the "TEK PREFERRED
STOCK") on the terms and conditions set forth in the Merger Agreement.
Capitalized terms used herein and not defined herein shall have their defined
meanings as set forth in the Merger Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties and covenants set forth herein, the parties agree as
follows:
1. TAX AND ACCOUNTING TREATMENT. Each Stockholder understands and
agrees that it is intended that the Merger will be treated as a "reorganization"
for federal income tax purposes. Stockholder further understands and agrees that
Stockholder may be deemed to be an "AFFILIATE" of DSNC within the meaning of
Rule 145 ("RULE 145") promulgated under the Securities Act of 1933, as amended
(the "SECURITIES ACT"), although nothing contained herein should be construed as
an admission of either such fact.
2. RELIANCE UPON REPRESENTATIONS, WARRANTIES AND COVENANT. Stockholder
has been informed that a reorganization for federal income tax purposes requires
that a sufficient number of former stockholders of DSNC maintain a meaningful
continuing equity ownership interest in Tek after the Merger. Each Stockholder
understands that the representations and warranties and covenants set forth
herein will be relied upon by Tek, DSNC, their respective counsel and accounting
firms and other stockholders of DSNC.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF EACH STOCKHOLDER. Each
Stockholder represents, warrants and covenants as follows:
(a) Such Stockholder has full power and authority to execute
this Agreement, to make the representations, warranties and covenants herein
contained and to perform such Stockholder's obligations hereunder.
(b) APPENDIX A attached hereto sets forth all shares of DSNC Common
Stock owned by such Stockholder, including all DSNC Common Stock as to which
such Stockholder
<PAGE>
bas sole or shared voting or investment power and all rights and options to
acquire DSNC Common Stock.
(c) Such Stockholder will not sell, transfer, exchange, pledge, or
otherwise dispose of, or make any offer or agreement relating to any of the
foregoing with respect to, any shares of Tek Preferred Stock that such
Stockholder may acquire in connection with the Merger or acquire upon exercise
of any option or right to acquire Tek Preferred Stock, which option or right is
acquired in connection with the Merger, or any securities that may be paid as a
dividend or otherwise distributed thereon or with respect thereto or issued or
delivered in exchange or substitution therefor (all such shares and other
securities of Tek being herein sometimes collectively referred to as "RESTRICTED
SECURITIES"), or any option, right or other interest with respect to any
Restricted Securities, unless (i) such transaction is permitted pursuant to Rule
145(c) and 145(d) under the Securities Act (as described in Section 6 below), or
(ii) counsel representing such Stockholder shall have advised Tek in a written
opinion letter satisfactory to Tek and Tek's legal counsel, and upon which Tek
and its legal counsel may rely, that no registration under the Securities Act
would be required in connection with the proposed sale, transfer or other
disposition, or (iii) a registration statement under the Securities Act covering
the Tek Preferred Stock proposed to be sold, transferred or otherwise disposed
of, describing the manner and terms of the proposed sale, transfer or other
disposition, and containing a current prospectus, shall have been filed with the
SEC and made effective under the Securities Act, or (iv) an authorized
representative of the SEC shall have rendered written advice to such Stockholder
(sought by such Stockholder or counsel to such Stockholder, with a copy thereof
and all other related communications delivered to Tek) to the effect that the
SEC would take no action, or that the staff' of the SEC would not recommend that
the SEC take action, with respect to the proposed disposition if consummated.
(d) Notwithstanding any other provision of this Agreement to the
contrary, such Stockholder will not sell, transfer, exchange, pledge or
otherwise dispose of, or in any other way reduce such Stockholder's risk of
ownership or investment in, or make any offer or agreement relating to any of
the foregoing with respect to any DSNC Common Stock or any rights, options or
warrants to purchase DSNC Common Stock, or any Restricted Securities or other
securities of Tek (i) during the 30-day period immediately preceding the
Effective Time of the Merger and (ii) until such time after the Effective Time
of the Merger as Tek has publicly released a report including the combined
financial results of Tek and DSNC for a period of at least 30 days of combined
operations of Tek and DSNC within the meaning of Accounting Series Release No.
130, as amended, of the SEC. Tek agrees to publish such financial results
expeditiously in a manner consistent with its prior practices; PROVIDED, that
nothing contained herein shall obligate Tek to publish its financial results
other than on a quarterly basis.
(e) Each Stockholder has, and as of the Effective Time of the
Merger will have, no present plan or intention (a "Plan") to sell, transfer,
exchange, pledge (other than in a pre-existing bona fide margin account) or
otherwise dispose of, including a distribution by a partnership to its partners,
or a corporation to its stockholders, or any other transaction which results in
a reduction in the risk of ownership (any of the foregoing, a "Sale") of more
than 50% of the shares of Tek Preferred Stock that Stockholder may acquire in
connection with the Merger,
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<PAGE>
or any securities that may be paid as a dividend or otherwise distributed
thereof or with respect thereto or issued or delivered in exchange or
substitution therefor. For purposes of the preceding sentence, shares of DSNC
Common Stock (or the portion thereof, (i) with respect to which any applicable
dissenters' rights are exercised, (ii) which are exchanged for cash in lieu of
fractional shares of Tek Preferred Stock, or (iii) with respect to which a Sale
(A) in a Related Transaction (as defined below) or (B) will occur prior to the
Merger, shall be considered to be shares of DSNC Common Stock that are exchanged
for Tek stock in the Merger and then disposed of pursuant to a Plan. Stockholder
is not aware of, or participating in, any Plan on the part of DSNC stockholders
to engage in Sales of the shares of Tek Preferred Stock to be issued in the
Merger such that the aggregate fair market value, as of the Effective Time of
the Merger, of the shares subject to such Sales would exceed 50% of the
aggregate fair market value of all shares of outstanding DSNC Common Stock
immediately prior to the Merger. For purposes of the preceding sentence, shares
of DSNC Common Stock (i) with respect to which any applicable dissenters' rights
are exercised, (ii) which are exchanged for cash in lieu of fractional shares of
Tek Preferred Stock or (iii) with respect to which a pre-Merger Sale occurs in a
Related Transaction, shall be considered to be shares of DSNC Preferred Stock
that are exchanged for Tek Preferred Stock in the Merger and then disposed of
pursuant to a Plan. A Sale of Tek Preferred Stock shall be considered to have
occurred pursuant to a Plan if, among other things, such Sale occurs in a
Related Transaction. For purposes of this Section 3(e), a "RELATED TRANSACTION"
shall mean a transaction that is in contemplation of, or related or pursuant to,
the Merger or the Merger Agreement. If any of such Stockholder's representations
in this Section 3(e) ceases to be true at any time prior to the Effective Time
of the Merger, such Stockholder shall deliver to each of DSNC and Tek, prior to
the Effective Time of the Merger, a written statement to that effect, signed by
such Stockholder.
4. RULE 144 AND 145. From and after the Effective Time of the Merger
and for so long as is necessary in order to permit Stockholder to sell the Tek
Preferred Stock held by and pursuant to Rule 145 and, to the extent applicable,
Rule 144 under the Securities Act, Tek will use its reasonable best efforts to
file on a timely basis all reports required to be filed by it pursuant to
Section 13 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"), referred to in paragraph (c)(1) of Rule 144 under the Securities Act, in
order to permit Stockholder to sell the Tek Preferred Stock held by it pursuant
to the terms and conditions of Rule 145 and the applicable provisions of Rule
144. Any future disposition by Stockholder of Tek Preferred Stock will be
accomplished in compliance with all applicable securities laws. Stockholder
understands that Tek is under no obligation to register the sale, transfer or
other disposition of any Restricted Securities by or on behalf of such
Stockholder or to take any other action necessary in order to make compliance
with an exemption from registration available.
5. LEGEND. Each Stockholder agrees that the following legend be placed
upon the certificate evidencing ownership of Tek Preferred Stock:
THESE SHARES ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET
FORTH IN RULES 144 AND 145 PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND MAY NOT BE SOLD, HYPOTHECATED, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT
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<PAGE>
PURSUANT TO THE PROCEDURES DESCRIBED THEREIN.
6. LIMITED RESALES. Each Stockholder understands that, in addition to
the restrictions imposed under Section 3 of this Agreement, the provisions of
Rule 145 limit such Stockholder's public resales of Restricted Securities, in
the manner set forth in subsections (a), (b) and (c) below, until such time as
such Stockholder has beneficially owned, within the meaning of Rule 144(d), the
Restricted Securities for a period of at least one year (or in some cases two
years) after the date of the Merger, and thereafter if and for so long as such
Stockholder remains an Tek affiliate:
(a) Unless and until the restriction "cut-off" provisions of Rule
145(d)(2) or Rule 145(d)(3) set forth below become available, public resales of
Restricted Securities may only be made by such Stockholder in compliance with
the requirements of Rule 145(d)(1). Rule 145(d)(1) permits such resales only (i)
while Tek meets the public information requirements of Rule 144(c), (ii) in
"brokers' transactions" or in transactions with a "market maker" in accordance
with Rule 144(f) and Rule 144(g) and (iii) where the aggregate number of
Restricted Securities sold at any time together with all sales of Tek Preferred
Stock sold for such Stockholder's account during the preceding three-month
period does not exceed the greater of (x) 1% of the Tek Preferred Stock
outstanding, (y) the average weekly volume of trading in Tek Preferred Stock on
all national securities exchanges and/or reported through the automated
quotation system of a registered securities association during the four calendar
weeks preceding the date of receipt of the order to execute the sale or (z) the
average weekly volume of trading in Tek Preferred Stock reported through the
consolidated transaction reporting system contemplated by Rule llAa3-1 under the
Exchange Act during the four-week period specified in subsection (y) above.
(b) Each Stockholder may make unrestricted resales of Restricted
Securities pursuant to Rule 145(d)(2) if (i) such Stockholder has beneficially
owned (within the meaning of Rule 144(d) under the Securities Act) the
Restricted Securities for at least one year after the Effective Time of the
Merger, (ii) such Stockholder is not an affiliate of Tek and (iii) Tek meets the
public information requirements of Rule 144(c).
(c) Each Stockholder may make unrestricted resales of Restricted
Securities pursuant to Rule 145(d)(3) if such Stockholder (i) has beneficially
owned (within the meaning of Rule 144(d) under the Securities Act) the
Restricted Securities for at least two years and (ii) is not and has not been
for at least three months, an affiliate of Tek.
(d) Tek acknowledges that the provisions of Section 3(c) of this
Agreement will be satisfied as to any sale by the undersigned of the Restricted
Securities pursuant to Rule 145(d) by delivery to Tek of a broker's letter and a
letter from the undersigned with respect to that sale stating THAT each of the
above-described requirements of Rule 145(d)(1) has been met or is inapplicable
by virtue of Rule 145(d)(2) or Rule 145(d)(3); PROVIDED, that Tek has no
reasonable basis to believe such sales were not made in compliance with such
provisions of Rule 145(d).
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<PAGE>
7. NOTICES. All notices, requests, demands or other communications
which are required or may be given pursuant to the terms of this Agreement shall
be in writing and shall be deemed to have been duly given upon receipt, if
delivered by hand, by telecopy or telegram, or three days after deposit in the
United States mail, postage prepaid, addressed to a party as follows:
If to Tek: TekInsight.Com, Inc.
5 Hanover Square, 24th Floor
New York, New York 10004
Telecopy: (212) 271-8083
Attention: Alexander Kalpaxis,
Chief Technology Officer
With a copy to: Nixon Peabody LLP
437 Madison Avenue
New York, New York 10022
Telecopy: (212) 940-3111
Attention: Peter W. Rothberg, Esq.
If to Stockholder: At the address set forth beneath such
Stockholder's signature;
or to such other address as any party may designate for itself by notice given
as provided in this Agreement.
8. TERMINATION. This Agreement shall be terminated and shall be of no
further force and effect upon the termination of the Merger Agreement pursuant
to Article VII thereof.
9. BINDING AGREEMENT. This Agreement will inure to the benefit of and
be binding upon and enforceable against the parties and their successors and
assigns, including administrators, executors, representatives, heirs, legatees
and devises of each Stockholder and any pledgee holding Restricted Securities as
collateral.
10. WAIVER. No waiver by any party hereto of any condition or of any
breach of any provision of this Agreement shall be effective unless in writing
and signed by each party hereto. each party hereto.
11. GOVERNING LAW. This Agreement shall be governed by and construed,
interpreted and enforced in accordance with the laws of the State of New York
without giving effect to principles of conflicts of laws.
12. ATTORNEYS' FEES. In the event of any legal action or proceeding to
enforce or interpret the provisions hereof, the prevailing party shall be
entitled to reasonable attorneys' fees, whether or not the proceeding results in
a final judgment.
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<PAGE>
13. EFFECT OF HEADINGS. The section headings herein are for convenience
only and shall not affect the construction or interpretation of its Agreement.
14. THIRD PARTY RELIANCE. Counsel to and accountants for the parties
shall be entitled to rely upon the representations, warranties and covenants
contained in this Agreement.
15. COUNTERPARTS. This Agreement shall be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one instrument
[The remainder of this page is intentionally left blank.]
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
TEKINSIGHT.COM, INC.
By:/s/Alexander Kalpaxis
------------------------------
Name: Alexander Kalpaxis
----------------------------
Title:Chief Technology Officer
---------------------------
STOCKHOLDERS:
/s/Michael W. Grieves
---------------------------------
Name: Michael W. Grieves
---------------------------------
Name: Richard R. Burkhart
/s/Gregory D. Cocke
---------------------------------
Name: Gregory D. Cocke
DIRECTORS:
---------------------------------
---------------------------------
---------------------------------
OFFICERS:
---------------------------------
---------------------------------
---------------------------------
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<PAGE>
APPENDIX A
DSNC SECURITIES
Shareholder: NUMBER OF SHARES
Michael W. Grieves 707,500
DSNC Common Stock 707,500
Options to Purchase DSNC Common Stock
June 1997 $8.75 8,000
October 1994 $4.75 10,000
Total Options to Purchase DSNC Common Stock - 18,000
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DSNC SECURITIES
Shareholder NUMBER OF SHARES
Richard R. Burkhart 140,625
DSNC Common Stock 140,625
Options to Purchase DSNC Common Stock
May 1997 $9.38 1,000
May 1996 $4.00 1,000
May 1995 $3.00 1,000
Total Options to Purchase DSNC Common Stock - 3,000
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DSNC SECURITIES
Shareholder NUMBER OF SHARES
Gregory D. Cooke 361,250
DSNC Common Stock 361,250
Options to Purchase DSNC Common Stock
October 1997 $13.25 6,250
July 1997 $12.00 5,000
September 1996 $4.00 15,000
October 1994 $4.75 7,500
Total Options to Purchase DSNC Common Stock- 33,750
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