SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): September 22, 1999
BOCA RESEARCH, INC.
(Exact Name of Registrant as Specified in its Charter)
Florida 0-21138 59-2479377
(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation or organization) Identification Number)
1377 Clint Moore Road
Boca Raton, Florida 33487
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code: (561) 997-6227
Not Applicable
(former address if changed since last report)
ITEM 5. OTHER EVENTS
On September 22, 1999, Boca Research, Inc., a Florida corporation (the
"Company", entered into a Common Stock Purchase Agreement (the"Agreement") with
National Semiconductor Corporation, a Delaware corporation (the "Purchaser"),
pursuant to which the Purchaser would purchase 691,085 newly issued shares of
common stock of the Company at a purchase price of $7.235 per share, for an
aggregate purchase price of approximately $5.0 million in cash.
The closing of the transactions contemplated by the Agreement occurred on
September 24, 1999.
The summary of the Agreement set forth above is qualified in its entirety
by reference to the Agreement which is filed as an
exhibit hereto and is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Not Applicable.
(b) Not Applicable.
(c) Exhibits - Incorporated by Reference
Exhibit No. Description
10.21 Common Stock Purchase Agreement, dated as of September 22,
1999, by and between Boca Research, Inc. and National
Semiconductor Corporation
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
BOCA RESEARCH, INC.
(Registrant)
Date: September 27, 1999 By: /s/ ANTHONY F. ZALENSKI
Anthony F. Zalenski
President and Chief
Executive Officer
EXHIBIT INDEX
Exhibit Description
10.21 Common Stock Purchase Agreement, dated as of
September 22, 1999, by and between Boca Research,
Inc. and National Semiconductor Corporation
COMMON STOCK PURCHASE AGREEMENT
between
BOCA RESEARCH, INC.
and
NATIONAL SEMICONDUCTOR CORPORATION
____________________
September 13, 1999
____________________
TABLE OF CONTENTS
ARTICLE I AUTHORIZATION OF ISSUANCE OF THE COMMON STOCK.....................1
ARTICLE II PURCHASE AND SALE OF COMMON STOCK, CLOSING......................1
Section 2.01. Purchase and Sale.........................................1
Section 2.02. Closing...................................................1
Section 2.03 Deliveries.................................................2
Section 2.04 Use of Proceeds............................................2
Section 2.05 Definitions................................................2
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY...................2
Section 3.01. Organization and Good Standing............................2
Section 3.02. Capitalization............................................2
Section 3.03. Due Authorization; Execution and Delivery.................3
Section 3.04. Absence of Breach; No Conflict............ ...............3
Section 3.05. Securities Law Compliance.................................4
Section 3.06. Commission Documents; Financial Information...............4
Section 3.07. Approvals; Compliance with Laws; LicenseS and Authorities.5
Section 3.08. Litigation................................................5
Section 3.09. Tax Matters...............................................6
Section 3.10. Material Contracts........................................6
Section 3.11. Title to Properties, Encumbrances.........................7
Section 3.12. Plant and Equipment; Sufficiency Of Assets................7
Section 3.13. Labor Matters.............................................7
Section 3.14. Environmental Matters.....................................8
Section 3.15. No Existing Violation, Default, Etc.......................8
Section 3.16. Affiliate Transactions....................................8
Section 3.17. Insurance.................................................8
Section 3.18. Unlawful Payments and Contributions.......................9
Section 3.19. Year 2000.................................................9
Section 3.20. Absence of Certain Events; No Material Adverse Change.....9
Section 3.21. Full Disclosure..........................................10
Section 3.22. ERISA....................................................10
Section 3.23 Intellectual Property.....................................11
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.................11
Section 4.01. Organization and Standing................................11
Section 4.02. Investment Representation................................11
Section 4.03. Due Authorization; Execution and Delivery................11
Section 4.04. Absence of Breach; No Conflict...........................12
Section 4.05. No Consents..............................................12
Section 4.06. Investment Company.......................................12
Section 4.07. Ownership of Stock of the Company........................12
Section 4.08. Certain Regulatory Matters...............................12
Section 4.09. Due Diligence............................................13
Section 4.10 Availability of Funds.....................................13
Section 4.11. Confidentiality..........................................13
Section 4.12 Existing Pre-emptive Rights...............................13
ARTICLE V COVENANTS.......................................................13
Section 5.01. Covenants of the Company.................................13
(a) Access and Confidentiality......................................13
(b) Announcements...................................................14
(c) Shares..........................................................14
(i) Replacement of Certificates..................................14
(ii) Government and Other Approvals..............................14
Section 5.02 Proxy Matters; Standstill.................................14
ARTICLE VI FINANCIAL STATEMENTS; ACCESS TO INFORMATION....................17
Section 6.01. Financial Statements.....................................17
Section 6.02. Access to Information....................................17
ARTICLE VII CONDITIONS PRECEDENT TO THE OBLIGATIONS OF EACH PARTY TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY............................18
Section 7.01. No Adverse Action or Decision.............................18
Section 7.02. No Injunction............................................18
Section 7.03 Consents of Third Parties, Modification of Agreements.....18
Section 7.04. Hart-Scott-Rodino Filing.................................18
ARTICLE VIII CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY TO ISSUE,
SELL AND DELIVER THE COMMON STOCK .........................................19
Section 8.01. Accuracy of the Purchaser's Representations and Warranties.19
Section 8.02. Performance by the Purchaser.............................19
Section 8.03 Opinion of Robinson Humphrey Company LLC..................19
ARTICLE IX CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE PURCHASER TO
PURCHASE THE SHARES........................................................19
Section 9.01. Accuracy of the Company's Representations and Warranties.19
Section 9.02. Performance by the Company...............................20
Section 9.03. No Material Adverse Effect...............................20
Section 9.04. Governmental Approvals and Consents......................20
Section 9.05. Secretary's Certificate..................................20
Section 9.06. Proceedings..............................................20
Section 9.07. Shares...................................................21
ARTICLE X TERMINATION.....................................................21
Section 10.01. Termination by Mutual Written Consent...................21
Section 10.02. Termination by the Company or the Purchaser.............21
Section 10.03. Termination by the Purchaser............................21
Section 10.04. Termination by the Company..............................22
Section 10.05. Effect of Termination...................................22
Section 10.06. Negotiations with Third Parties.........................22
ARTICLE XI DEFINITIONS....................................................22
ARTICLE XII MISCELLANEOUS.................................................26
Section 12.01. Notices.................................................26
Section 12.02. Fees and Expenses; Indemnification......................27
Section 12.03. Survival of Representations and Warranties..............28
Section 12.04. Entire Agreement........................................28
Section 12.05. Successors and Assigns..................................28
Section 12.06. Paragraph Headings......................................28
Section 12.07. Applicable Law..........................................28
Section 12.08. Severability............................................28
Section 12.09. Equitable Remedies......................................28
Section 12.10. No Waiver...............................................29
Section 12.11. Counterparts............................................29
Section 12.12. Brokers.................................................29
Section 12.13. Certain Assignment of Rights............................29
Section 12.14 Effective Date...........................................29
TABLE OF SCHEDULES
Schedule 2.01..... Wire Transfer Account
Schedule 3.01(a).. Subsidiaries
Schedule 3.01(b). Outstanding Capital Stock of Subsidiaries
Schedule 3.02..... Options, Warrants, Rights, Puts, Calls, Commitments,
etc.
Schedule 3.04..... Breaches, Conflicts
Schedule 3.08..... Litigation
Schedule 3.20..... Material Adverse Change
Schedule 3.23..... Intellectual Property
COMMON STOCK PURCHASE AGREEMENT
AGREEMENT made and entered into as of September 22, 1999, between BOCA
RESEARCH, INC., a Florida corporation (the "Company"), and NATIONAL
SEMICONDUCTOR CORPORATION, a Delaware corporation, (the "Purchaser").
WITNESSETH
WHEREAS, the Company desires to sell to the Purchaser, and the Purchaser
desires to purchase from the Company, 691,085 shares of the Company's Common
Stock, par value $0.01 per share ("Shares"), such total Shares purchased not to
exceed 19.9% of the Company's theretofore issued common stock; and
WHEREAS, the Company and the Purchaser are entering into this Agreement to
provide for said purchase and sale of Shares and to establish various rights and
obligations in connection therewith, upon the terms and subject to the
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual premises and covenants
contained herein, and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:
ARTICLE I
AUTHORIZATION OF ISSUANCE OF THE COMMON STOCK
Prior to the Closing, the Company shall have duly authorized and taken all
such corporate and other action which is necessary in accordance with the terms
of this Agreement to effect the valid issuance, sale and delivery to the
Purchaser of the Shares to be purchased by Purchaser hereunder.
ARTICLE II
PURCHASE AND SALE OF COMMON STOCK; CLOSING
Section 2.01. Purchase and Sale. Upon the terms and subject to the
conditions hereinafter set forth, on the Closing Date, the Company shall issue,
sell and deliver to the Purchaser, and the Purchaser shall purchase from the
Company, 691,085 shares ("Shares") at $7.235 per share, for the total purchase
price equal to Five Million Dollars ($5,000,000.00). Payment for the Shares
shall be made by wire transfer of immediately available funds to the account of
the Company designated on Schedule 2.01 hereto (or in such other manner as may
be agreed by the Purchaser and the Company), and shall be wired against the
issuance and delivery by the Company on the Closing Date to the Purchaser of
certificates in definitive and fully registered form representing the aggregate
number of Shares being purchased by the Purchaser.
Section 2.02. Closing. Subject to the terms and conditions of this
Agreement, the closing of the transactions contemplated by this Agreement (the
"Closing") shall take place at the offices of Spinner, Dittman, Federspiel &
Dowling at 10:00 a.m., Eastern time, on September 29, 1999, or at such other
later date or such other place as the parties shall mutually agree. The date of
the Closing is referred to in this Agreement as the "Closing Date."
Section 2.03 Deliveries. At or prior to the Closing, the parties shall
deliver all documents, instruments, certificates and writings required to be
executed and delivered by them at or prior to the Closing pursuant to this
Agreement.
Section 2.04 Use of Proceeds. The proceeds from the purchase and sale of
the Shares hereunder will be
used for general corporate purposes.
Section 2.05 Definitions. Terms used as defined terms herein and not
otherwise defined shall have the meanings set forth in Article XI.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As of the Closing, the Company will represent and warrant to the Purchaser
as follows:
Section 3.01. Organization and Good Standing. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Florida, and is duly qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction in which the nature of
the business transacted by it or the character or location of the properties
owned or leased by it requires such qualification, except where the failure to
be so qualified or in good standing would not have a Material Adverse Effect.
The Company has full corporate power and authority to own and manage its
properties and to carry on its business as it is now being (and as it is
currently proposed to be) conducted. The copies of the Company's certificate of
incorporation, by-laws and other organizational documents and instruments (in
each case, as amended and/or restated through the date hereof), heretofore made
available to the Purchaser, are true, complete and correct copies thereof. The
Company, directly or indirectly, owns all of the outstanding capital stock of
each Subsidiary. The Company does not own any interest in any other company or
entity other than the Subsidiaries set forth on Schedule 3.01(a), and other than
interests in trusts established by the Company or its Subsidiaries in connection
with the Company's securitization program. Each Subsidiary is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation or organization and has the power and authority to own or lease
its properties and to conduct its business as now conducted. All outstanding
shares of the capital stock of each Subsidiary have been validly issued and are
fully paid and non-assessable. Except as set forth on Schedule 3.01(b), there
are no outstanding options, warrants, rights, agreements or commitments of any
nature whatsoever of any third party to subscribe for or purchase any equity
security of any Subsidiary or to cause any Subsidiary to issue any such equity
security.
Section 3.02. Capitalization. The authorized capitalization of the Company
consists of: (a) 25,000,000 shares of common stock, par value $0.01 per share,
and (b) 5,000,000 shares of Preferred Stock, par value $0.01 per share
("Preferred Stock"). As of June 30, 1999, there were 10,578,110 shares of common
stock outstanding, and there are currently no shares of Preferred Stock
outstanding. No other class or series of capital stock of the Company is, or at
the Closing will be, authorized or issued. All such shares outstanding on the
date hereof are, and the Shares, when issued, will be, duly authorized, validly
issued and fully paid and non-assessable and free and clear of any and all
Liens. Except as set forth on Schedule 3.02, there are no outstanding options,
warrants, rights, puts, calls, commitments, or other contracts, arrangements, or
understandings issued by or binding upon the Company requiring or providing for,
and there are no outstanding debt or equity securities of the Company which upon
the conversion, exchange or exercise thereof would require or provide for, the
issuance by the Company of any shares of capital stock (or any other securities
of the Company which, with notice, lapse of time and/or payment of monies, are
or would be convertible into or exercisable or exchangeable for shares of
capital stock). Except as set forth in Schedule 3.02, there are no preemptive or
other similar rights available to the existing holders of shares or other
securities of the Company.
Section 3.03. Due Authorization; Execution and Delivery. The Company has
all requisite corporate right, power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby, including without
limitation the issuance of the Shares. As of the Closing, the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby will have been duly authorized and approved by
the Board of Directors of the Company and no further corporate action on the
part of the Company is necessary to authorize the execution, delivery and
performance by the Company of this Agreement or the consummation by the Company
of the transactions contemplated hereby. This Agreement constitutes, as of the
Closing Date, the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with their respective terms,
except that such enforcement may be subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar laws
affecting creditors' rights, and the remedies of specific performance and
injunctive relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought.
Section 3.04. Absence of Breach; No Conflict. Except as set forth on
Schedule 3.04 hereto, the execution, delivery, and performance of this Agreement
by the Company and the consummation by the Company of the transactions
contemplated hereby will not (a) give rise to a right to (or otherwise)
terminate, accelerate the maturity of or accelerate or increase any payment due
under, trigger a right of redemption of, conflict with, result in a breach or
violation of any of the terms, conditions or provisions of, constitute a default
(or an event which, with notice or lapse of time, or both, would constitute a
default) under, require any approval, waiver or consent under, or result in the
creation or imposition of any obligations on behalf of the Company or any Lien
upon any property or assets of the Company or any Subsidiary pursuant to the
terms of, any note, bond, mortgage, pledge, indenture, deed of trust, lease,
agreement, indemnity, obligation, commitment, instrument, franchise, license,
certificate or permit to which the Company or any of the Subsidiaries is a party
or by which any of their respective properties or assets may be bound; (b)
violate or conflict with any term or provision of the certificate of
incorporation, by-laws or equivalent organizational instruments and documents
(in each case, as amended and/or restated through the date hereof) of the
Company or any Subsidiary; or (c) assuming the accuracy of the representations
and warranties of the Purchaser contained in Article IV hereof, violate any
judgment, decree, order, writ, statute, rule or regulation of any judicial,
arbitral, public, or governmental authority having jurisdiction over the
Company, any of the Subsidiaries or any of their respective properties or
assets. The issuance of the Shares will not violate the rules, regulations or
bylaws of the Nasdaq Stock Market or any other securities exchange on which the
securities of the Company are traded or listed.
Section 3.05. Securities Law Compliance. Assuming the representations and
warranties of the Purchaser set forth in Section 4.02 hereof are true and
correct, the offer and sale of the shares of common stock (collectively, the
"Issuable Shares") pursuant to this Agreement will be exempt from the
registration requirements of the Securities Act. Neither the Company nor any
Person acting on its behalf has, in connection with the offering of the Issuable
Shares, engaged in (i) any form of general solicitation or general advertising
(as those terms are used within the meaning of Rule 502(c) under the Securities
Act), (ii) any action involving a public offering within the meaning of Section
4(2) of the Securities Act, or (iii) any action that would require the
registration under the Securities Act of the offering and sale of the Issuable
Shares pursuant to this Agreement or that would violate applicable state
securities or "blue sky"laws. The Company has not made and will not prior to
the Closing make, directly or indirectly, any offer or sale of the Issuable
Shares of the same or similar class as the Issuable Shares if, as a result, the
offer and sale contemplated hereby could fail to be entitled to exemption from
the registration requirements of the Securities Act. As used herein, the terms
"offer" and "sale" have the meanings specified in Section 2(3) of the Securities
Act.
Section 3.06. Commission Documents; Financial Information.
(a) The Company has made available to the Purchaser true and complete
copies of all SEC Documents filed with the Commission prior to the date
hereof and will furnish the Purchaser a true and correct copy of each
amendment thereto and any SEC Documents filed by the Company with the
Commission on or before the Closing Date. As of their respective filing
dates, the SEC Documents complied (or will comply) in all material respects
with the requirements of the Securities Act, Exchange Act and the rules and
regulations of the Commission thereunder applicable to such SEC Documents,
and as of their respective dates none of the SEC Documents contained (or
will contain) any untrue statement of a material fact or omitted (or will
omit) to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. The financial statements of the
Company and its Subsidiaries included in the SEC Documents comply (or will
comply) as of their respective dates as to form in all material respects
with applicable accounting requirements and the rules and regulations of
the Commission with respect thereto (except as may be indicated in the
notes thereto or, in the case of the unaudited statements, as permitted by
Form 10-Q promulgated by the Commission), and present fairly (or will
present fairly) as of their respective dates the consolidated financial
position of the Company and the Subsidiaries as at the dates thereof and
the consolidated results of their operations and their consolidated cash
flows for each of the respective periods, in conformity with GAAP. As used
in this Agreement, the consolidated balance sheet of the Company and its
Subsidiaries at June 30, 1999 previously provided to the Purchaser is
hereinafter referred to as the "Balance Sheet", and June 30, 1999 is
hereinafter referred to as the "Balance Sheet Date."
(b) Except as and to the extent expressly set forth in the Balance
Sheet, or the notes, schedules or exhibits thereto, or as disclosed in the
SEC Documents, (i) as of the Balance Sheet Date, neither the Company nor
the Subsidiaries had any material liabilities or obligations (whether
absolute, contingent, accrued or otherwise) that would be required to be
included on a balance sheet or in the notes, schedules or exhibits thereto
prepared in accordance with GAAP and (ii) since the Balance Sheet Date, the
Company and its Subsidiaries have not incurred any such material
liabilities or obligations other than in the ordinary course of business.
Section 3.07. Approvals; Compliance with Laws; Licenses and
Authorities.
(a) Except as provided for in this Agreement and assuming the
accuracy of the representations and warranties of the Purchaser
contained in Article IV hereof, no notices, reports or other filings
are required to be made by the Company or any Subsidiary with, nor are
any consents, registrations, applications, approvals, permits,
licenses or authorizations required to be obtained by the Company or
any Subsidiary from, any public or governmental authority or other
third party in connection with the execution and delivery of this
Agreement, the consummation by the Company of the transactions
contemplated hereby, or the exercise by the Purchaser of its rights
hereunder, except for any of the foregoing, the failure of which to
make or obtain would not have a Material Adverse Effect or adversely
affect the Purchaser's rights hereunder.
(b) The business of the Company and each of the Subsidiaries has
been and is presently being conducted in compliance with all
applicable federal, state, county and local ordinances, statutes,
rules, regulations and laws (collectively "Laws").
(c) Except as would not have a Material Adverse Effect, (i) the
Company and its Subsidiaries have all permits or licenses of all
Authorities that are necessary to carry on the business of the Company
and its Subsidiaries as now conducted; (ii) each such permit or
license is in full force and effect and has not been revoked, canceled
or encumbered and the Company or relevant Subsidiary is in compliance
therewith in all respects; and (iii) no such permit or license will be
terminated or adversely affected by virtue of the execution of the
Agreement or the performance by the parties of their obligations or
the exercise by the parties of their rights hereunder.
Section 3.08. Litigation. Except as set forth in SEC Documents
filed with the Commission prior to the date of this Agreement or as
set forth on Schedule 3.08, there are no pending actions, suits,
proceedings, arbitrations or investigations against or affecting the
Company or any of its Subsidiaries or any of their respective
properties, assets or operations, or with respect to which the Company
or any such Subsidiary is responsible by way of indemnity or otherwise
(a "Material Claim"), that are required under the Securities Act or
Exchange Act to be described in such SEC Documents or which, if there
is an adverse decision, could singly, or in the aggregate, with all
such other actions, suits, investigations or proceedings, have a
Material Adverse Effect and, to the knowledge of the Company, no such
actions, suits, proceedings or investigations are threatened. No
adverse development has occurred with respect to any Material Claim
except as disclosed in the SEC Documents filed with the Commission
prior to the date of this Agreement.
Section 3.09. Tax Matters.
(a) Each of the Company and its Subsidiaries has filed or caused
to be filed, or has properly filed extensions for, all material Tax
Returns that are required to be filed by or respect to the Company,
any of its Subsidiaries or the business of the Company and its
Subsidiaries; and each of the Company and its Subsidiaries has timely
paid or caused to be paid all material Taxes with respect thereto
whether or not shown on said Tax Returns (and on all material
assessments received by it) to the extent that such Taxes and
assessments have become due, except for any failure to so file or
cause to be filed, any failure to so file an extension, or any failure
to so pay or cause to be paid, in each case that would not,
individually or in the aggregate, have a Material Adverse Effect, and,
except for any failure to pay or cause to be paid Taxes the validity
or amount of which is being contested in good faith by appropriate
proceedings and with respect to which adequate reserves, in accordance
with generally accepted accounting principles, have been set aside.
All said Tax Returns are complete and accurate in all respects and
have been prepared in compliance with all applicable laws and
regulations, except for any such failure to be complete and accurate
or to be so prepared that would not, individually or in the aggregate,
have a Material Adverse Effect. The Company and its Subsidiaries
reasonably believe that(i) the reserves on the Balance Sheet of the
Company and its Subsidiaries for Taxes due or owing by the Company and
its Subsidiaries to be adequate in all material respects for all
unpaid Taxes, whether or not disputed, of the Company and its
Subsidiaries for all fiscal years that, as of the Balance Sheet Date,
had not been examined and reported on by any taxing authorities (or
closed by applicable statutes), and (ii) as of the Closing Date, such
reserves as adjusted on the books in accordance with past practice,
will be sufficient for the then-unpaid taxes of the Company and its
Subsidiaries attributable to periods prior to and ending on the
Closing Date, except in either case where any failure to establish any
such reserve would not individually or in the aggregate constitute a
Material Adverse Effect.
(b) There are no actions or proceedings currently pending or, to
the best knowledge of the Company or any of its Subsidiaries,
threatened in writing against the Company, any of its Subsidiaries or
any affiliated group with respect to the Company, any of its
Subsidiaries or the business of the Company and its Subsidiaries by
any governmental authority for the assessment or collection of
material Taxes, and no claim for the assessment or collection of
material Taxes has been asserted in writing against the Company or any
of its Subsidiaries or any affiliate group with respect to the
Company, any of its Subsidiaries or the business of the Company and
its Subsidiaries, in either case which singly or in the aggregate are
likely to have a Material Adverse Effect.
Section 3.10. Material Contracts. All of the material contracts
of the Company or any of its Subsidiaries that are required to be
described in the SEC Documents or to be filed as exhibits thereto
prior to the date hereof are described in the SEC Documents filed
prior to the date hereof or filed as exhibits thereto and are in full
force and effect. True and complete copies of all such material
contracts as of Closing have been made available to the Purchaser. All
material contracts to which the Company or its Subsidiaries are
parties on or prior to the date hereof which will be required to be
described or filed as an Exhibit in the SEC Documents required to be
filed following the date hereof have been provided to the Purchaser
and are in full force and effect. Neither the Company nor any of its
Subsidiaries nor, to the knowledge of the Company, any other party is
in material breach of or in default under any such contract.
Section 3.11. Title to Properties, Encumbrances. Each of the
Company and its Subsidiaries has good and valid title to its
respective assets, free and clear of all defects and Liens except (a)
materialmen's, mechanics', carriers', workmen's, warehousemen's,
repairmen's, or other like Liens arising in the ordinary course of
business; (b) Liens for current Taxes not yet due and payable; (c)
Liens or minor imperfections of title that do not materially interfere
with the use or materially detract from the value of such property,
and (d) Liens permitted or created by the Finova loan agreement.
Section 3.12. Plant and Equipment; Sufficiency Of Assets.
(a) The plant and equipment used by the Company and its
Subsidiaries has been maintained to the standards of operating
condition and repair typical of companies engaged in the same or
similar businesses except as would not have a Material Adverse Effect.
(b) Each of the Company and its Subsidiaries own or have the
lawful right to use all assets, properties, operating rights,
easements, contracts, leases, licenses, and other instruments
necessary to operate their businesses lawfully and to maintain the
same as presently conducted except as would not have a Material
Adverse Effect.
Section 3.13. Labor Matters.
(a) Neither the Company nor any of its Subsidiaries is party to
any labor or collective bargaining agreement and there are no labor or
collective bargaining agreements which pertain to employees of the
Company or any of its Subsidiaries.
(b) No employees of the Company or any Subsidiary are represented
by any labor organization. No labor organization or group of employees
of the Company or any of its Subsidiaries has made a pending demand
for recognition or certification, and there are no representation or
certification proceedings or petitions seeking a representation
proceeding presently pending or, to the knowledge of the Company,
threatened to be brought or filed, with the NLRB or any other labor
relations tribunal or authority. To the knowledge of the Company,
there are no organizing activities involving the Company or any of its
Subsidiaries pending with, or threatened by, any labor organization.
(c) There are no strikes, work stoppages, slowdowns, lockouts,
material arbitrations or material grievances or other material labor
disputes pending or, to the knowledge of the Company, threatened
against or involving the Company or any of its Subsidiaries. Except as
would not result in any Material Adverse Effect, there are no unfair
labor practice charges, grievances or complaints pending or, to the
knowledge of the Company, threatened by or on behalf of any employee
or group of employees of the Company or any of its Subsidiaries.
Section 3.14. Environmental Matters.
(a) Each of the Company and its Subsidiaries is in material
compliance with all Environmental Laws and neither the Company nor any
of its Subsidiaries has received any written communication from a
governmental authority with respect to such compliance or the failure
thereof.
(b) There is no civil, criminal or administrative action, claim,
demand, investigation or notice relating to a violation of an
Environmental Law (an "Environmental Claim") pending or, to the
knowledge of the Company, threatened and to the knowledge of the
Company, there are no past or present actions, activities,
circumstances, conditions, events or incidents, including, without
limitation, the release, emission, discharge or disposal of any
chemical, pollutant, contaminant, waste, toxic substance, petroleum or
petroleum product, that would form the basis of any Environmental
Claim, in either case (A) against the Company or any of its
Subsidiaries, (B) against any person or entity whose liability for any
Environmental Claim the Company or any of its Subsidiaries has or may
have retained or assumed either contractually or by operation of law,
or (C) involving any real or personal property which the Company or
any of its Subsidiaries owns, leases or manages except, in each case,
as would not have a Material Adverse Effect.
Section 3.15. No Existing Violation, Default, Etc. Neither the Company
nor any of its Subsidiaries is (a) in violation of any provision of its
certificate of incorporation, by-laws or other organizational documents or
(b) in violation of any applicable Law, stock exchange rule or regulation,
which violation has or would reasonably be expected to have a Material
Adverse Effect. No breach, event of default or event that, but for the
giving of notice or the lapse of time or both, would constitute an event of
default exists under any indenture, mortgage, loan agreement, note or other
agreement or instrument for borrowed money, any guarantee of any agreement
or instrument for borrowed money or any lease, permit, license or other
agreement to which the Company or any of its Subsidiaries is a party or by
which the Company or any such Subsidiary is bound or to which any of the
properties, assets or operations of the Company or any such Subsidiary is
subject, which breach, event of default, or event that, but for the giving
of notice or the lapse of time or both, would constitute an event of
default, has or would reasonably be expected to have a Material Adverse
Effect.
Section 3.16. Affiliate Transactions. Except as disclosed in the SEC
Documents, the Company and its Subsidiaries have not entered into any
material transaction or material series of transactions with any current or
former director, officer, employee or Affiliate of the Company.
Section 3.17. Insurance. The Company and its Subsidiaries, in the
reasonable determination of the Company's management, maintain with
financially sound and reputable insurers insurance against loss or damage
of the kinds customarily insured against by corporations of established
reputation engaged in the same or a similar business and similarly
situated, and of such types and in such amounts as is customarily carried
under similar circumstances by such other corporations.
Section 3.18. Unlawful Payments and Contributions. Neither the
Company nor any of its directors, officers or, to the Company's
knowledge, any of its other employees or agents has (a) used any
Company funds for any unlawful contribution, endorsement, gift,
entertainment or other unlawful expense relating to political
activity; (b) made any direct or indirect unlawful payment to any
government official or employee from Company funds; (c) violated or is
in violation of any provision of the Foreign Corrupt Practices Act of
1977, as amended, in connection with the Company's and its
Subsidiaries' business; or (d) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment to any person or
entity with respect to matters pertaining to the Company.
Section 3.19. Year 2000. The Company and its Subsidiaries have
undertaken those steps and efforts to assume Year 2000 compliance
internally and with regard to its products as described in its most
recent 10K filed with the SEC.
Section 3.20. Absence of Certain Events; No Material Adverse
Change. Except as disclosed in the SEC Documents filed with the
Commission prior to the date hereof, since the Balance Sheet Date, the
Company and its Subsidiaries each has conducted its business
operations in the ordinary course and there has not occurred any event
or condition having or, that is reasonably likely to have, a Material
Adverse Effect. Without limiting the generality of the foregoing,
other than as is disclosed in the SEC Documents filed with the
Commission prior to the date hereof or on Schedule 3.20 hereto, since
the Balance Sheet Date there has not occurred:
(a) any change or agreement to change the character or nature of
the business of the Company or any of its Subsidiaries;
(b) any purchase, sale, transfer, assignment, conveyance or
pledge of the assets or properties of the Company or any of its
Subsidiaries, except in the ordinary course of business;
(c) any waiver or modification by the Company or any of its
Subsidiaries of any right or rights of substantial value, or any
payment, direct or indirect, in satisfaction of any liability, in each
case, having a Material Adverse Effect;
(d) any liability, contract, agreement, license or other
commitment entered into or assumed by or on behalf of the Company or
any of its Subsidiaries relating to the business, assets or properties
of the Company or any of its Subsidiaries, whether oral or written,
except in the ordinary course of business;
(e) any loan, advance or capital expenditure by the Company or
any of its Subsidiaries, except for loans, advances and capital
expenditures made in the ordinary course of business;
(f) any change in the accounting principles, methods, practices
or procedures followed by the Company in connection with the business
of the Company or any change in the depreciation or amortization
policies or rates theretofore adopted by the Company in connection
with the business of the Company and its Subsidiaries;
(g) any declaration or payment of any dividends, or other
distributions in respect of the outstanding shares of capital stock of
the Company or any of its Subsidiaries (other than dividends declared
or paid by wholly-owned Subsidiaries);
(h) any issuance of any shares of capital stock of the Company or
any of its Subsidiaries or any other change in the authorized
capitalization of the Company or any of its Subsidiaries, except as
contemplated by this Agreement;
(i) any grant or award of any options, warrants, conversion
rights or other rights to acquire any shares of capital stock of the
Company or any of its Subsidiaries, except as contemplated by this
Agreement or except pursuant to employee benefit plans, programs or
arrangements in existence on the date hereof, in the ordinary course
of business consistent with past practice;
(j) (i) any granting by the Company or any of its Subsidiaries to
any employee earning in excess of $100,000 per year any increase in
compensation, except in the ordinary course of business consistent
with prior practice or as was required under employment agreements in
effect as of the date of the most recent audited financial statements
included in the SEC Documents, (ii) any granting by the Company or any
of its Subsidiaries to any employee earning in excess of $100,000 per
year of any increase in severance or termination pay, except as was
required under any employment, severance, or termination agreements in
effect as of the date of the most recent audited financial statements
included in the SEC documents, or (iii) any entry by the Company or
any of its Subsidiaries into any employment, severance, or termination
agreement with any employee earning in excess of $100,000 per year; or
(k) any adoption, or amendment in any material respect, by the
Company or any of its Subsidiaries of any collective bargaining
agreement or any bonus, pension, profit sharing, deferred
compensation, incentive compensation, stock ownership, stock purchase,
stock option, phantom stock, retirement, vacation, severance, change
of control, retention, disability, death benefit, hospitalization,
medical, or other plan, arrangement, or understanding (whether or not
legally binding) providing benefits to any current or former employee,
officer, or director of the Company or any of its Subsidiaries
(collectively, "Benefit Plans").
Section 3.21. Full Disclosure. None of the statements made by the
Company in this Agreement (including, without limitation, the
representations and warranties made by the Company herein and in the
schedules and exhibits hereto which are incorporated by reference
herein and which constitute an integral part of this Agreement)
contains (or will contain on the Closing Date) any untrue statement of
a material fact, or omits (or will omit on the Closing Date) to state
any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading.
Section 3.22. ERISA. Neither the Company nor any of its
subsidiaries sponsors or maintains (or has ever sponsored or
maintained) an "employee pension benefit plan" (within the
meaning of Section 3(2) of ERISA) that is subject to Title IV of
ERISA or to the minimum funding requirements of Section 412 of
the Code or Part 3 of Title I of ERISA. Neither the Company nor
any of its subsidiaries contributes or is obligated to contribute
(or has ever been obligated to contribute) to a "multiemployer
plan" (within the meaning of Section 4001(a)(3) of ERISA).
Section 3.23 Intellectual Property. Except as set forth on
Schedule 3.23, to the best of the Company's knowledge, it owns,
free and clear of all liens, encumbrances, licenses, claims and
other restrictions or burdens, all patents, trade names, internet
domain names, trademarks, copyrights, inventions, processes,
designs, computer software, works of authorship, franchises,
formulas, trade secrets, know-how and other intangible property
and proprietary rights (collectively, "Intellectual Property")
necessary for or used in the conduct of its business, and may use
all such Intellectual Property in the conduct of its business
with no conflict with or infringement of the rights of others
which would have a material adverse impact on the Company.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants and covenants to the
Company as follows:
Section 4.01. Organization and Standing. The Purchaser is
duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation.
Section 4.02. Investment Representation. The Purchaser
represents and warrants that it is an "Accredited Investor"
within the meaning of Rule 501(a) of Regulation D under the
Securities Act, and it is or will be acquiring the Shares for its
own account and not with a view to, or for sale in connection
with, any distribution thereof in violation of the Securities
Act. It understands that the Shares have not been registered
under the Securities Act by reason of a specific exemption from
the registration provisions thereof which depends upon, among
other things, the bona fide nature of the Purchaser's investment
intent as expressed herein. The Purchaser hereby acknowledges and
agrees that upon the original issuance thereof, and until such
time as the same is no longer required under the applicable
requirements of the Securities Act and the rules and regulations
thereunder, the Shares may bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE LAWS REGULATING
THE SALE OF SECURITIES AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED UNLESS REGISTERED OR AN OPINION OF COUNSEL SATISFACTORY TO THE
CORPORATION IS OBTAINED TO THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED."
Section 4.03. Due Authorization; Execution and
Delivery. The Purchaser represents and warrants that it has
the requisite right, power and authority to enter into this
Agreement, and to consummate the transactions contemplated
hereby, and that the execution, delivery and performance of
this Agreement, and the consummation of the transactions
contemplated hereby have been duly authorized by all
necessary action on its behalf, and this Agreement
constitutes, and will constitute, the legal, valid and
binding obligation of it, enforceable against it in
accordance with the terms hereof, except that such
enforcement may be subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors' rights, and
the remedy of specific performance and injunctive relief may
be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be
brought.
Section 4.04. Absence of Breach; No Conflict. The
Purchaser represents and warrants that the execution,
delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will
not (a) conflict with, or constitute a default under, any
agreement to which the Purchaser is a party or by which any
of the properties or assets of thePurchaser may be bound;
(b) violate or conflict with the governing organizational
instruments and documents (in each case, as amended and/or
restated through the date hereof) of the Purchaser or (c)
assuming that the Purchaser is an "operating company" as
such term is defined in Department of Labor Regulation
2510.3-101, violate any statute, rule, regulation, order,
judgment, writ or decree of any judicial public or
governmental authority having jurisdiction over the
Purchaser, or any of the properties or assets of the
Purchaser, which violation would prevent, impair, hinder or
delay the consummation of the transactions contemplated by
this Agreement.
Section 4.05. No Consents. Other than as set forth on
Schedule 4.05, the Purchaser represents and warrants that no
consent, authorization or approval of, or filing with, any
person or any federal, state or local government department,
commission, board, agency or instrumentality is required to
be made or obtained by the Purchaser in connection with its
execution and performance of this Agreement as may be
required under the HSR Act or pursuant to the laws, rules
and regulations of the Department of Commerce notifications
and except for such consents, authorizations, approvals and
filings the absence of which would not prevent, impair,
hinder or delay the consummation of the transactions
contemplated by this Agreement.
Section 4.06. Investment Company. The Purchaser
represents and warrants that it is not (and immediately
after consummation of the transactions contemplated by this
Agreement will not be) an investment company, a company
controlled by an investment company, or otherwise subject to
any provisions of the Investment Company Act of 1940, as
amended, and/or the rules and regulations of the Commission
promulgated thereunder.
Section 4.07. Ownership of Stock of the Company. The
Purchaser represents and warrants that it does not own
beneficially or of record any shares of capital stock or
other securities of the Company and does not have any
present intention or plan to acquire shares of capital stock
or other securities of the Company except pursuant to this
Agreement and the transactions contemplated hereby.
Section 4.08. Certain Regulatory Matters. The Purchaser
represents and warrants that it is not aware of any facts or
circumstances regarding the Purchaser, including the record
or beneficial ownership of any securities by the Purchaser,
which can reasonably be expected to cause the Department of
Justice or the Federal Trade Commission to prohibit the
Purchaser's acquisition of Shares contemplated hereunder or
the exercise by the Purchaser of its rights contained herein
pursuant to their regulatory authority over such matters.
Section 4.09. Due Diligence. Without in any way
affecting or mitigating the representations and warranties
of the Company contained in Article III of this Agreement or
affecting any rights resulting from a breach thereof, the
Purchaser will, if it participates in Closing, acknowledge
that as of Closing, it has had an opportunity to engage in
due diligence on the Company and has had an opportunity to
discuss the Company and its business and prospects with
management of the Company.
Section 4.10 Availability of Funds. The Purchaser
represents that it has immediately available to it adequate
funds, without borrowing same, necessary to perform its
obligations under this Agreement.
Section 4.11. Confidentiality.The Purchaser
acknowledges its obligation under the Confidentiality
Agreement heretofore entered into with the Company as it
specifically relates to contracts with the Company's
customers.
Section 4.12 Existing Pre-emptive Rights. The Purchaser
acknowledges and understands that, pursuant to an Amended
Stock Purchase Agreement, dated as of May 21, 1999, between
the Company and Infomatec Integrated Information Systems AG,
as assigned to Infomatec AG International, Inc.
("Infomatec"), (a) Infomatec purchased approximately 19.9%
of the Company's outstanding common stock as of June 1,
1999, (b) Infomatec has the right, subject to certain
conditions, to purchase its pro rata share of new securities
offered by the Company in order to maintain its then
percentage ownership interest in the Company ("pre-emptive
rights"), and (c) the issuance of Shares to the Purchaser
will give Infomatec the right to exercise its pre-emptive
rights.
ARTICLE V
COVENANTS
Section 5.01. Covenants of the Company
(a) Access and Confidentiality. Upon reasonable notice
prior to the Closing, the Company shall (and shall cause
each of its Subsidiaries to) afford the Purchaser and its
representatives reasonable access during normal business
hours to its properties, books, contracts and records and
personnel and advisors and the Company shall (and shall
cause each of the Subsidiaries to) furnish promptly to the
Purchaser all information concerning its business,
properties and personnel as the Purchaser or its
representatives may reasonably request, provided that (i)
any review will be conducted in a way that will not
interfere unreasonably with the conduct of the Company's
business and (ii) neither the Purchaser nor any of its
representatives will contact any of the Company's employees,
advisors, customers or suppliers in connection with the
transactions contemplated by this Agreement without the
prior express consent of the Chief Executive Officer of the
Company..
(b) Announcements. Except as required by law or as
advised by outside counsel, no party or any Affiliate,
officer or agent of the parties hereto shall make any
announcement concerning the transactions contemplated hereby
without the other parties' written consent, which consent
shall not unreasonably be withheld; provided, however, that
any party or such Affiliate, officer or agent may make any
announcements required by applicable law so long as the text
of such announcement shall have been provided to the parties
hereto prior to the making of such announcement. The parties
agree to consult with each other with respect to
announcements concerning the transactions contemplated
hereby.
(c) Shares. From the date hereof until the Closing, the
Company will not issue any shares of its capital stock or
securities convertible or exchangeable for shares of capital
stock, except for the issuances set forth on Schedule 3.02.
The Company hereby covenants to the Purchaser, that, from
and after the date hereof and so long as the Purchaser owns
any Shares, the Company shall:
(i) Replacement of Certificates. Upon receipt by the
Company of evidence reasonably satisfactory to it of loss,
theft, destruction or mutilation of any certificate
evidencing any of the Shares (or securities issued upon
exchange, conversion or exercise thereof), and (in case of
loss, theft or destruction) of indemnity reasonably
satisfactory to the Company, and upon the surrender and
cancellation of such certificate, if mutilated, the Company
shall make and deliver in lieu of such certificate a new
certificate for the number of Shares (or securities issued
upon exchange, conversion or exercise thereof), as the case
may be, evidenced by such lost, stolen, destroyed or
mutilated certificate which remains outstanding. A
Purchaser's (which term does not include any successors or
assigns of the initial Purchaser) agreement of indemnity
shall constitute indemnity satisfactory to the Company for
the purposes of this Section 5.01(c) without the need of any
further surety or bond.
(ii) Government and Other Approvals. Promptly prepare,
submit and file with all public and governmental
authorities, all applications, notices, registrations,
certificates, statements and such other information,
documents and instruments as may be required pursuant to any
federal, state, local or foreign Law or rule or regulation
of the NASD or any securities exchange in connection with
the consummation of the transactions contemplated by this
Agreement.
Section 5.02 Proxy Matters; Standstill.
(a) The Purchaser hereby agrees that during the
Standstill Period (hereinafter defined) it will not, nor
will it permit any of its Affiliates (any such Purchaser
together with its Affiliates being hereinafter referred to
as a "Purchaser Group") to, directly or indirectly, unless
in any such case specifically authorized in advance to do so
by the Board of Directors of the Company:
(i) acquire, offer to acquire, or agree to acquire by
purchase, by joining a partnership, limited partnership,
syndicate or other "group" (as such term is used in Section
13(d)(3) of the Exchange Act, hereinafter referred to as
"13D Group"), any securities of the Company entitled to vote
generally in the election of directors, or securities
convertible into or exercisable or exchangeable for such
securities (collectively, "Restricted Shares") or any
material portion of the assets or businesses of the Company
and its Subsidiaries if and to the extent that such action
would trigger a Change of Control or such action has not
received any requisite approval from governmental
authorities; provided, however, that nothing contained
herein shall prohibit any member of a Purchaser Group from
acquiring any Restricted Shares acquired (x) pursuant to
this Agreement or otherwise contemplated hereby, (y) as a
result of a stock split, stock dividend or other
distribution of Restricted Sharesby the Company to an
existing holder of Restricted Shares or (z) upon the
execution of unsolicited buy orders by any member of a
Purchaser Group which is a registered broker-dealer for the
bona fide accounts of its brokerage customers unaffiliated
and not acting in concert with any member of such Purchaser.
Prior to acquiring any shares of capital stock of the
Company, other than upon exercise of its rights under this
Agreement, the Purchaser will give written notice of its
intent to do so to the Company. If within ten (10) days
after receipt of such notice, the Company advises the
Purchaser in writing that, based on the advice of its
advisors, it believes that the proposed acquisition would be
prohibited by this paragraph, the parties shall thereafter
discuss in good faith whether such acquisition would in fact
be so prohibited;
(ii) participate in, or encourage, the formation of any
13D Group which owns or seeks to acquire beneficial
ownership of, or otherwise acts in respect of, Restricted
Shares, other than any 13D Group which is comprised
exclusively of the Purchaser or a Purchaser Group permitted;
(iii) make, or in any way participate in, directly or
indirectly, any "solicitation" of "Proxies" (as such terms
are defined or used in Regulation 14A under the Exchange
Act) or become a "participant" in any "election contest" (as
such terms are defined or used in Rule 14a-11 under the
Exchange Act) with respect to the Company, or initiate,
propose or otherwise solicit stockholders for the approval
of one or more stockholder proposals with respect to the
Company or induce or attempt to induce any other person to
initiate any stockholder proposal, provided, however, that
the limitation contained in this clause (iii) shall not
apply to (y) the election of any directors to be elected by
the holders of Shares or (z) any matter to be voted on by
the Company's stockholders that is not initiated or proposed
by any member of a Purchaser Group or any Affiliate thereof;
or
(iv) call or seek to have called any meeting of the
stockholders of the Company, provided, however, that the
limitation contained in this clause (iv) shall not apply to
any meeting of the stockholders of the Company called for
the purpose of voting on any matter described in the proviso
of clause (iii) above.
(b) Nothing in this Section 5.02 shall preclude members
of a Purchaser Group from exercising the voting and other
rights, (i) granted to the Purchaser pursuant to this
Agreement or (ii) in connection with any proposed merger,
sale of assets or similar transaction, or tender or exchange
offer proposed by any person who is not part of a Purchaser
Group or any of its Affiliates.
(c) As used herein, the term "Standstill Period" shall
mean the period from the date of this Agreement until the
earlier to occur of:
(i) the date which is the second anniversary of the
Closing Date; or
(ii) the designation of any date as the termination
date of the Standstill Period by a majority of the directors
of the Company at a duly convened meeting thereof or by all
of the directors of the Company by written consent; or
(iii) the Company's material breach of any of its
obligations contained in this Agreement; or
(iv) the Company or any of its Subsidiaries shall commence a voluntary case
concerning itself under Title 11 of the United States Code entitled "Bankruptcy"
as now or hereafter in effect, or any successor thereto (the "Bankruptcy Code"),
which has had or would have a Material Adverse Effect; or an involuntary case is
commenced against the Company or any of its Subsidiaries and the petition not
controverted within 10 days, or is not dismissed within 60 days after
commencement of the case which has had or would have a Material Adverse Effect;
or a custodian (as defined in the Bankruptcy Code) is appointed for, or takes
charge of, all or any substantial part of the property of the Company or any of
its Subsidiaries which has had or would have a Material Adverse Effect; or the
Company or any of its Subsidiaries commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors,
rehabilitation, dissolution, insolvency or liquidation or similar law of any
jurisdiction, whether now or hereafter in effect, relating to the Company or
such Subsidiary, or there is commenced against the Company or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days which has had or would have a Material Adverse Effect; or the Company or
any of its Subsidiaries is adjudicated insolvent or bankrupt which has had or
would have a Material Adverse Effect; or any order of relief or other order
approving any such case or proceeding is entered which has had or would have a
Material Adverse Effect; or the Company or any of the Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days which has
had or would have a Material Adverse Effect; or the Company or any of its
Subsidiaries makes a general assignment for the benefit of creditors which has
had or would have a Material Adverse Effect; or the Company shall fail to pay,
or shall state that it is unable to pay, or shall be unable to pay, its debts,
generally as they become due which has had or would have a Material Adverse
Effect; or the Company or any of its Subsidiaries shall call a meeting of its
creditors with a view to arranging a composition or adjustment of its debts
which has had or would have a Material Adverse Effect; or the Company or any of
its Subsidiaries shall by any act or failure to act indicate its consent to,
approval of or acquiescence in any of the foregoing which has had or would have
a Material Adverse Effect; or any corporate action is taken by the Company or
any of its Subsidiaries for the purpose of effecting any of the foregoing which
has had or would have a Material Adverse Effect; or
(v) without encouragement by or the participation of a Purchaser or any of
its Affiliates, the acquisition by any person or 13D Group (other than members
of a Purchaser Group or Affiliates thereof) of, the commencement of a tender
offer by such person or 13D Group for, or the public announcement of an
intention to acquire, Restricted Shares which, if added to the Restricted Shares
(if any) already owned by such person or 13D Group, would represent nineteen and
nine-tenths percent (19.9%) or more of the total voting power (including rights
to acquire voting power) of the Company's Restricted Shares, or the receipt by
such person or 13D Group of the Company's agreement or consent to make such
acquisition; or
(vi) the date this Agreement is terminated in accordance with its terms.
ARTICLE VI
FINANCIAL STATEMENTS; ACCESS TO INFORMATION
Section 6.01. Financial Statements. The Company covenants that it will
deliver to each Purchaser who owns any Issuable Shares those items set forth in
paragraphs (a), (b) and (d) and that, upon request, it will deliver to each
original Purchaser (but not their transferees) those items set forth in
paragraphs (c), (e) and (f):
(a) Promptly upon filing with the Commission for each quarterly period
(other than the last quarterly period) in each fiscal year, a copy of the
Quarterly Report on Form 10-Q of the Company for such quarterly period filed
with the Commission;
(b) Promptly upon filing with the Commission for each fiscal year a copy of
the Annual Report on Form 10-K of the Company for such fiscal year filed with
the Commission;
(c) In addition to the Forms 10-Q and 10-K, promptly upon transmission
thereof, copies of all proxy statements, notices and reports as it shall send to
its public stockholders and copies of all registration statements (without
exhibits), other than on Form S-8 or any similar successor form, and all reports
which it files with the Commission (or any governmental body or agency
succeeding to the functions of the Commission);
(d) Promptly upon receipt thereof, a copy of each other report submitted to
the Company or any of its Subsidiaries by independent accountants in connection
with any annual, interim or special audit made by them of the books of the
Company or any of its Subsidiaries; and
(e) With reasonable promptness, such other financial data as the Purchaser
may reasonably
request.
Section 6.02. Access to Information. The Company shall permit the Purchaser
(and its designated representatives) such rights of inspection of the corporate
books and records of the Company and its Subsidiaries as are provided under
Florida law. The Purchaser agrees, except as otherwise required by law, to keep
any confidential information obtained pursuant to this Article VI confidential.
ARTICLE VII
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF EACH PARTY
TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY
The respective obligation of each party hereto to consummate the
transactions contemplated hereby is subject to the satisfaction, at or before
the Closing, of each of the following conditions set forth in Section 7.01
through Section 7.03 below. These conditions may be waived by each party (in
whole or in part) at any time in its sole discretion.
Section 7.01. No Adverse Action or Decision. There shall be no action,
suit, investigation or proceeding pending with, or to the knowledge of the
Company threatened against or affecting the Company, any of its Subsidiaries or
any of their respective properties or rights, before any court, arbitrator or
administrative or governmental body which (a) seeks to restrain, enjoin or
prevent the consummation of the issuance, sale and delivery of the Shares to the
Purchaser or (b) challenges the validity or legality of the issuance, sale and
delivery of the Shares to the Purchaser or seeks to recover damages or to obtain
other relief in connection therewith, which in any single case or in the
aggregate (i) the Company or the Purchaser shall reasonably determine is
reasonably likely to result in a Material Adverse Effect, or (ii) the Purchaser
shall reasonably determine is reasonably likely to result in a material
impairment to the Purchaser's rights hereunder.
Section 7.02. No Injunction. No temporary, preliminary or permanent
injunction or any order by any federal or state court of competent jurisdiction
shall have been issued which prohibits or otherwise seeks to prohibit, restrain,
enjoin or delay the consummation of the issuance, sale and delivery of the
Shares to the Purchaser.
Section 7.03. Consents of Third Parties; Modification of Agreements. The
Company shall have duly obtained modifications of or waivers under the
agreements described in this Agreement amending or waiving any right to
acceleration, redemption or increase of any payment or obligation of the Company
or its Subsidiaries which could arise as a result of the transactions
contemplated hereby, which modifications or waivers shall be in a form
reasonably satisfactory to the Purchaser.
Section 7.04. Hart-Scott-Rodino Filing. To the extent required, the Company
and the Purchaser hereby agree to comply with the filing requirements of the
Hart- Scott-Rodino Act prior to closing.
ARTICLE VIII
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY
TO ISSUE, SELL AND DELIVER THE COMMON STOCK
The obligations of the Company to issue, sell and deliver the Shares are
subject to the satisfaction, at or before the Closing, of each of the following
additional conditions set forth in Sections 8.01, 8.02, 8.03, and 8.04 below.
These conditions are for the Company's sole benefit and may be waived by the
Company (in whole or in part) at any time in its sole discretion.
Section 8.01. Accuracy of the Purchaser's Representations and Warranties.
The representations and warranties of the Purchaser contained in Article IV
hereof shall be true and correct as of the date when made and as of the Closing
Date, as though made on such date, and the Company shall have received a
certificate attesting thereto signed by a duly authorized officer or agent of
the Purchaser.
Section 8.02. Performance by the Purchaser. The Purchaser shall have
performed, satisfied and complied with, in all material respects, all covenants,
agreements, and conditions required by this Agreement to be performed, satisfied
or complied with by it on or prior to the Closing Date, and the Company shall
have received a certificate attesting thereto signed by a duly authorized
officer or agent of the Purchaser.
Section 8.03 Opinion of Robinson Humphrey Company LLC. The Company shall
have obtained the opinion of Robinson Humphrey Company LLC to the effect that
the consideration to be paid by the Purchaser to the Company is fair to the
stockholders of the Company from a financial point of view.
ARTICLE IX
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE
PURCHASER TO PURCHASE THE SHARES
The obligations of the Purchaser hereunder to acquire and pay for, and
accept delivery of, the Shares are subject to the satisfaction, at or before the
Closing, of each of the following additional conditions set forth in Section
9.01 through Section 9.07 below. These conditions are for the Purchaser's sole
benefit and may be waived (in whole or in part) by the Purchaser.
Section 9.01. Accuracy of the Company's Representations and Warranties. The
representations and warranties of the Company contained in Article III hereof
which are not subject to a qualification regarding materiality shall be true and
correct in all material respects as of the date when made and as of the Closing
Date, as though made on such date, the representations and warranties of the
Company contained in Article III hereof, which are subject to a qualification
regarding materiality shall be true and correct in all respects as of the date
when made and as of the Closing Date, as though made on such date, and the
Purchaser shall have received a certificate attesting thereto signed by the
Chief Executive Officer of the Company .
Section 9.02. Performance by the Company. The Company shall have performed,
satisfied and complied with, in all material respects, all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by the Company on or prior to the Closing Date, and the Purchaser shall
have received a certificate attesting thereto signed by the Chief Executive
Officer of the Company.
Section 9.03. No Material Adverse Effect. There shall not have occurred and
there shall not otherwise exist any condition, event or development having, or
likely to have (in the reasonable judgment of the Purchaser), a Material Adverse
Effect provided, however, that the following shall not be taken into account in
determining whether there has occurred, or a condition, event or development has
had or is likely to have, a "Material Adverse Effect": (1) any adverse change,
event or effect that is demonstrated to be primarily caused by conditions
affecting the United States economy generally or the economy of any nation or
region in which the Company or any of its Subsidiaries conducts business which
is material to the business of the Company and its Subsidiaries taken as a
whole; (2) any adverse change, event or effect that is demonstrated to be
primarily caused by conditions generally affecting the industry within which the
Company or its Subsidiaries are engaged; and (3) any adverse change, event or
effect that is demonstrated to be primarily caused by the announcement or
pendency of the transactions contemplated by this Agreement.
Section 9.04. Governmental Approvals and Consents. The Company shall have
duly obtained, received or effected (and all applicable waiting and termination
periods, if any, including any extensions thereof, under any applicable law,
statute, regulation or rule, shall have expired or terminated) all
authorizations, consents, approvals, licenses, franchises, permits and
certificates by or of, and shall have made all filings and effected all
notifications, registrations and qualifications with, all federal, state and
local governmental and regulatory Authorities necessary for the issuance, sale
and delivery of the Shares being issued and sold at the Closing.
Section 9.05. Secretary's Certificate. The Secretary or an Assistant
Secretary of the Company shall have delivered to the Purchaser at the Closing
Date a Certificate dated as of the Closing certifying: (a) that attached thereto
is a true and complete copy of the By-Laws of the Company as in effect on the
date of such certification; (b) that attached thereto is a true and complete
copy of all resolutions adopted by the Board of Directors of the Company
authorizing the execution, delivery and performance of the Agreement, the
issuance, sale and delivery of the Shares, and that all such resolutions are in
full force in effect and are all the resolutions adopted in connection with the
transactions contemplated by this Agreement; (c) that attached thereto is a true
and complete copy of the Certificate of Incorporation as in effect on the date
of such certification; and (d) to the incumbency and specimen signature of
certain officers of the Company.
Section 9.06. Proceedings. All corporate and other proceedings to be taken
by the Company in connection with the transactions contemplated by this
Agreement and all documents reflecting or evidencing such proceedings shall be
reasonably satisfactory in scope, form and substance to the Purchaser and its
legal counsel, and the Purchaser and its legal counsel shall have received all
such duly executed counterpart originals or certified or other copies of such
documents and instruments as they may reasonably request.
Section 9.07. Shares. The sale of the Shares to the Purchaser hereunder
shall have been exempted from the provisions of the Blue Sky Law of the Florida
Statutes.
ARTICLE X
TERMINATION
Section 10.01. Termination by Mutual Written Consent. This Agreement may be
terminated and the transactions contemplated hereby may be abandoned, for any
reason, at any time prior to the Closing Date, by the mutual written consent of
the Company and the Purchaser.
Section 10.02. Termination by the Company or the Purchaser. Subsequent to
the approval of the Board of Directors of the Company, this Agreement may be
terminated and the transactions contemplated hereby may be abandoned by action
of the Company or the Purchaser if and to the extent that (a) the Closing shall
not have occurred at or prior to 5:00 p.m., Eastern time, on September 29, 1999;
provided, however, that the right to terminate this Agreement under this Section
10.02 shall not be available to any party whose failure to fulfill any
obligation under this Agreement has been the cause of, or resulted in, the
failure of the Closing Date to occur on or before such date; or (b) any court or
governmental authority of competent jurisdiction shall have issued an order,
decree, writing or ruling or taken any other action, or there shall be in effect
any statute, rule or regulation, permanently restraining, enjoining or otherwise
prohibiting the purchase of the Shares hereunder, or the consummation of the
transactions contemplated by this Agreement.
Section 10.03. Termination by the Purchaser. Subsequent to the approval of
the Board of Directors of the Company, this Agreement may be terminated and the
transactions contemplated hereby may be abandoned by action of the Purchaser, at
any time prior to the Closing Date, if (a) the Company shall have failed to
comply in any material respect with any of the covenants or agreements contained
in this Agreement to be complied with or performed by the Company at or prior to
such date of termination, and the Company shall not, within a reasonable period
of time after notice of such failure, have cured or commenced prompt and
diligent measures which would promptly cure such failure, (b) there shall have
been a material misrepresentation or material breach by the Company with respect
to any representation or warranty made by it in this Agreement and such
misrepresentation or breach cannot be cured prior to the Closing Date, or (c)
there shall have occurred and be continuing any condition, event or development
having, or reasonably likely to have, a Material Adverse Effect provided,
however, that the following shall not be taken into account in determining
whether there has occurred, or a condition, event or development has had or is
likely to have, a "Material Adverse Effect": (1) any adverse change, event or
effect that is demonstrated to be primarily caused by conditions affecting the
United States economy generally or the economy of any nation or region in which
the Company or any of its Subsidiaries conducts business which is material to
the business of the Company and its Subsidiaries taken as a whole; (2) any
adverse change, event or effect that is demonstrated to be primarily caused by
conditions generally affecting the industry within which the Company or its
Subsidiaries are engaged; and (3) any adverse change, event or effect that is
demonstrated to be primarily caused by the announcement or pendency of the
transactions contemplated by this Agreement.
Section 10.04. Termination by the Company. This Agreement may be terminated
and the transactions contemplated hereby may be abandoned by action of the
Company, at any time prior to the Closing Date, if (a) the Purchaser shall have
failed to comply in any material respect with any of the covenants or agreements
contained in this Agreement to be complied with or performed by the Purchaser at
or prior to such date of termination and the Purchaser shall not, within fifteen
(15) days following written notice from the Company to the Purchaser of such
default, have cured or commenced prompt and diligent measures which would
promptly cure such failure, (b) there shall have been a material
misrepresentation or material breach by the Purchaser with respect to any
representation or warranty made by the Purchaser in this Agreement and such
misrepresentation or breach cannot be cured prior to the Closing Date, or (c)
pursuant to Section 10.06 below.
Section 10.05. Effect of Termination. If this Agreement is terminated
pursuant to this Article X, this Agreement shall become void and of no effect
with no liability on the part of any party hereto, except (a) to the extent such
termination results from the breach by a party hereto of any of its
representations, warranties, covenants or agreements set forth in this
Agreement, and (b) with respect to Section 12.02 (a) and (c) that the covenants
and agreements contained in that certain Confidentiality Agreement between the
parties dated August 26, 1999, shall survive termination hereof.
Section 10.06. Negotiations with Third Parties. The Company agrees that
prior to closing, it will not directly or indirectly solicit third parties for
the sale and purchase of the Shares; provided, however, that the Company shall
be entitled to entertain, discuss and negotiate with any third party that
provides an unsolicited offer for the sale of the Shares that is potentially
superior to the terms of this Agreement in satisfaction of its fiduciary
obligations to the Company's stockholders, as advised by its independent legal
counsel. In the event the Company shall determine that an unsolicited offer is
superior, the Company reserves the right to terminate this Agreement by
providing written notice to the Purchaser.
ARTICLE XI
DEFINITIONS
"Affiliate" shall have the meaning set forth in Rule 12b-2 promulgated by
the Commission under the
Exchange Act.
"Approval Date" shall mean the date (i) on which the Purchaser shall have
obtained all necessary approvals from the regulatory authorities with
jurisdiction over the acquisition of the Shares and (ii) on which all applicable
notice and comment periods shall have expired without disapproval by the other
authorities. Such approval of the authorities shall mean approvals with respect
to the Purchaser's acquisition of the Shares.
"Authorities" shall mean approvals, consents, rights, certificates, orders,
franchises, determinations, permissions, licenses, authorities or grants issued,
declared, designated or adopted by any nation or government, any federal, state,
municipal or other political subdivision thereof or any department, commission,
board, bureau, agency or instrumentality exercising executive, legislative,
judicial, regulatory or administrative functions pertaining to government.
"Balance Sheet" shall have the meaning set forth in Section 3.06 of this
Agreement.
'Balance Sheet Date' shall have the meaning set forth in Section 3.06 of
this Agreement.
'Benefit Plans' shall have the meaning set forth in Section 3.20 of this
Agreement.
"Business Day" shall mean any day except a Saturday, Sunday or other day on
which commercial banks in the City of New York are not open for the transaction
of business.
"CERCLA" shall mean Comprehensive Environmental Response, Compensation, and
Liability Act.
"Change of Control" shall mean:
(i) An acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934 (the "Exchange Act") of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the
combined voting power of the then outstanding securities entitled to vote
generally in the election of directors of the Company; excluding, however,
the following (1) any acquisition by the Company, (2) any acquisition by
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company, or (3) any
acquisition by any entity pursuant to a transaction which is excluded from
subsection (ii) below; or
(ii) The approval by the shareholders of the Company of a
reorganization, merger or consolidation or sale or other disposition of all
or substantially all of the assets of the Company ("Corporate
Transaction"); excluding, however, any Corporate Transaction which would
result in the voting securities of the Company immediately prior to such
Corporate Transaction continuing to represent (either by remaining
outstanding or being converted into voting securities of another entity)
50% or more of the combined voting power of the securities entitled to vote
generally in the election of directors of the Company or such other entity
existing immediately after such Corporate Transaction.
"Closing" shall have the meaning set forth in section 2.02 of this
Agreement.
"Closing Date" shall have the meaning set forth in Section 2.02 of
this Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Commission" shall mean the Securities and Exchange Commission.
"Company" shall mean Boca Research, Inc., a Florida corporation.
"Environmental Claim" shall have the meaning set forth in Section 3.14.
"Environmental Laws" shall mean any applicable Law concerning releases
into any part of the natural environment, or protection of natural
resources, the environment and public and employee health and safety
including, without limitation, CERCLA, the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801 et seq .), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the Clean
Water Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act (33 U.S.C.
Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. Section
7401 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act 17
U.S.C.Section 136 et seq.), and OSHA, as such laws have been and may be
amended or supplemented through the Closing Date, and the regulations
promulgated pursuant thereto, and any applicable state or local statutes,
and the regulations promulgated pursuant thereto.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Finova Loan Agreement" shall mean that certain Loan Agreement and
collateral documents dated November 9, 1998, between Boca Research, Inc.
and Finova Capital Corporation.
"GAAP" shall mean United States generally accepted accounting
principles.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act
of 1976.
"IRS" shall mean the United States Internal Revenue Service.
"Liens" shall mean any lien, claim, charge, pledge, mortgage, security
interest or other encumbrance.
"Material Adverse Effect" shall mean a material adverse change in, or
a material adverse effect on any of (a) the business assets, operations, or
condition, financial or otherwise, of the Company or the Company and its
Subsidiaries taken as a whole or (b) the ability of the Company to perform
any of its obligations under this Agreement provided, however, that the
following shall not be taken into account in determining whether there has
occurred, or a condition, event or development has had or is likely to
have, a "Material Adverse Effect": (1) any adverse change, event or effect
that is demonstrated to be primarily caused by conditions affecting the
United States economy generally or the economy of any nation or region in
which the Company or any of its Subsidiaries conducts business which is
material to the business of the Company and its Subsidiaries taken as a
whole; (2) any adverse change, event or effect that is demonstrated to be
primarily caused by conditions generally affecting the industry within
which the Company or its Subsidiaries are engaged; and (3) any adverse
change, event or effect that is demonstrated to be primarily caused by the
announcement or pendency of the transactions contemplated by this
Agreement.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NLRB"shall mean the National Labor Relations Board.
"OSHA" shall mean Occupational Safety and Health Act.
"Permits" shall mean, collectively, each permit, license, order or
authorization from any public or governmental authority which is material
to or necessary for the conduct of the business of the Company or any of
the Subsidiaries.
"Person" shall mean any individual, firm, corporation,
partnership, limited liability company or partnership, trust,
incorporated or unincorporated association, joint venture, government
(or any agency or political subdivision thereof) or other entity of
any kind.
"Purchaser" shall mean National Semiconductor Corporation.
"SEC Documents" means all reports, schedules, registration
statements and other documents (including all exhibits and schedules
thereto) filed by the Company with the Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Shares" shall mean the common stock in the Company being
purchased by Purchaser. The Shares shall be unregistered and subject
to Rule 144 requirements and limitations on the Purchaser's sale or
disposition.
"Subsidiary"shall mean each corporation or other entity of which
a majority of the voting power of the voting equity securities or
equity interest is owned, directly or indirectly by the Company.
"Taxes" shall mean all taxes, charges, fees, levies or other
assessments, including, without limitation, all net income, gross
receipts, capital, sales, use, ad valorem, value added, transfer,
franchise, profits, inventory, capital stock, license, withholding,
payroll, employment, social security, unemployment, excise, severance,
stamp, occupation, property and estimated taxes, customs, duties,
fees, assessments and charges of any kind whatsoever, together with
any interest and any penalties, fines, additions to tax or additional
amounts imposed by any public or governmental taxing authority
(domestic or foreign) and shall include any transferee liability in
respect of Taxes.
"Tax Return" shall mean all returns, declarations, reports,
estimates, information returns and statements required to be filed in
respect of any Taxes.
ARTICLE XII
MISCELLANEOUS
Section 12.01. Notices. Except as otherwise provided herein,
whenever it is provided herein that any notice, demand,
request,consent, approval, declaration or other communication shall or
may be given to or served upon any of the parties by any other party,
or whenever any of the parties desires to give or serve upon any other
communication with respect to this Agreement, each such notice,
demand, request, consent, approval, declaration or other communication
shall be in writing and either shall be delivered in person with
receipt acknowledged or sent by registered or certified-mail, return
receipt requested, postage prepaid, or by overnight mail or courier,
or delivery service or by telecopy and confirmed by telecopy answer
back, addressed as follows:
(a) If to the Company to:
Boca Research, Inc.
1377 Clint More Road
Boca Raton, FL 33487
Attention: Chief Executive Officer
Phone: (561)997-6227
Facsimile: (561)997-6934
With a copy to:
Robert W. Federspiel, Esq.
Spinner, Dittman, Federspiel & Dowling
151 N.W. 1st Avenue
Delray Beach, FL 33444
Phone: (561)276-2900
Facsimile: (561)276-5489
(b) If to the Purchaser:
National Semiconductor Corporation
Attn: Thomas L. Humphrey
1090 Kifer Road, Mail Stop 16-365
Sunnyvale, California 94086
Phone: (408)721-5774
Facsimile: (408)721-1666
With a copy to:
___________________________________
General Counsel
1090 Kifer Road, Mail Stop 16-135
Sunnyvale, California 94086
Phone: (408)721-5774
Facsimile: (408)721-__________
or at such other address as may be substituted by notice given as herein
provided. The furnishing of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration or other communication hereunder
shall be deemed to have been duly given or served on (A) the date on which
personally delivered, with receipt acknowledged, (B) the date on which
telecopied and confirmed by telecopy answer back, or (C) the next Business
Day if delivered by overnight or express mail, courier or delivery service,
as the case may be. Failure or delay in delivering copies of any notice,
demand, request, consent, approval, declaration or other communication to
the persons designated above to receive copies shall in no way adversely
affect the effectiveness of such notice, demand, request, consent,
approval, declaration or other communication.
Section 12.02. Fees and Expenses; Indemnification. (a) Each party
shall be responsible for its own legal fees and costs with respect to
negotiating and entering into this Agreement. (b) The Company agrees
to indemnify and save harmless the Purchaser and its respective
officers, trustees, directors, partners, employees and agents from and
against any and all actions, causes of action, suits, losses,
liabilities and damages, and expenses (including, without limitation,
reasonable attorneys' fees and disbursements) in connection therewith
(herein called the "indemnified liabilities") incurred by Purchaser or
any of its officers, trustees, directors, partners, employees or
agents as a result of, or arising out of, or relating to a breach by
the Company of any of its representations, warranties or covenants
contained in this Agreement except for any indemnified liabilities
arising (i) on account of the gross negligence or willful misconduct
of the Purchaser or any of its officers, directors, partners,
employees or agents, (ii) on account of any breach of a material term
or provision of this Agreement by the Purchaser hereunder or (iii) on
account of Taxes based on income in respect of securities of the
Company, except as otherwise expressly provided herein; provided that,
if and to the extent such agreement to indemnify may be unenforceable
for any reason, the Company shall make the maximum contribution to the
payment and satisfaction of each of the indemnified liabilities which
shall be permissible under applicable law. The obligations of the
Company under this Section 12.02 shall survive the transfer,
redemption or conversion of any Shares. (c) Notwithstanding anything
to the contrary contained herein, the Purchaser shall not be entitled
to recover from the Company unless and until the total of all claims
for indemnity or damages with respect to any inaccuracy or breach of
any such representations or warranties (other than those contained in
Section12.12) or breach of or default in the performance of any
covenants, undertakings or other agreements, whether such claims are
brought under this Article XII or otherwise, exceeds $500,000.00 and
then only for the amount by which such claims for indemnity or damages
exceed $250,000.00. Under no circumstances shall the Company be
obligated to indemnify the Purchaser for losses in excess of the
Purchase Price received by the Company.
Section 12.03. Survival of Representations and Warranties. All
representations and warranties contained herein or made in writing by
the Company in connection herewith shall survive the execution and
delivery of this Agreement, the sale and purchase of the Shares and
any disposition thereof for a period ending sixty days following the
filing with the Commission of the Company's Annual Report on Form 10-K
covering the fiscal year ending December 31, 1999, except that the
representations and warranties contained in Section 3.09 and Section
4.07 shall survive until the expiration of the applicable statute of
limitations for Taxes and three (3) years, respectively.
Section 12.04. Entire Agreement. This Agreement, together with
the schedules and exhibits hereto which are incorporated by reference
herein, represents the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and
supersedes any and all prior oral and written agreements, arrangements
and understandings between the parties hereto with respect to such
subject matter, and can be amended, supplemented or changed only by a
written instrument making specific reference to this Agreement and
signed by the Company and the Purchaser.
Section 12.05. Successors and Assigns. This Agreement shall be
binding upon the parties hereto and their respective successors and
assigns, including any person to whom the Purchaser may assign its
right and obligations to purchase Shares and shall inure to the
benefit of the parties hereto and, their respective successors and
assigns.
Section 12.06. Paragraph Headings. The paragraph headings
contained in this Agreement are for general reference purposes only
and shall not affect in any manner the meaning or interpretation of
the terms or other provisions of this Agreement.
Section 12.07. Applicable Law. This Agreement shall be governed
by, construed and enforced in accordance with the laws of the State of
Florida, applicable to contracts to be made, executed, delivered and
performed wholly within such state, and in any case, without regard to
the conflicts of law principles of such state.
Section 12.08. Severability. If at any time subsequent to the
date hereof, any provision of this Agreement shall be held by any
court of competent jurisdiction to be illegal, void or unenforceable,
such provision shall be of no force and effect, but the illegality or
unenforceability of such provision shall have no effect upon and shall
not impair the enforceability of any other provision of this
Agreement.
Section 12.09. Equitable Remedies. The parties hereto agree that
irreparable harm would occur in the event that any of the covenants
contained in this Agreement were not performed in all material
respects by the parties hereto in accordance with their specific terms
or conditions or were otherwise breached, and that money damages are
an inadequate remedy for breach thereof because of the difficulty of
ascertaining and quantifying the amount of damage that will be
suffered by the parties hereto in the event that such covenants are
not performed in accordance with their terms or are otherwise
breached. It is accordingly hereby agreed that the parties hereto
shall be entitled to seek an injunction or injunctions to restrain,
enjoin and prevent breaches and violations of any of the covenants,
contained in this Agreement by the other parties and to enforce
specifically the terms and provisions hereof in any court of the
United States or any state having competent jurisdiction, such remedy
being in addition to and not in lieu of, any other rights and remedies
to which the other parties are entitled to at law or in equity.
Section 12.10. No Waiver. The failure of any party at any time or
times to require performance of any provision hereof shall not affect
the right at a later time to enforce the same. No waiver by any party
of any condition, and no breach of any provision, term, covenant,
representation or warranty contained in this Agreement, whether by
conduct or otherwise, in any one or more instances, shall be deemed to
be construed as a further or continuing waiver of any such condition
or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement. All waivers must be in
writing.
Section 12.11. Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute but one and the same
original instrument.
Section 12.12. Brokers. The Company, on the one hand, and the
Purchaser, on the other hand, represents and warrants to the other
party hereto that neither it nor any of its officers, directors,
general partners, agents, employees, Affiliates or associates, has
engaged or authorized any broker or finder to act, directly or
indirectly, on its behalf, in connection with the transactions
contemplated by this Agreement, or has consented to or acquiesced in
anyone so acting, and it knows of no claim by any person for
compensation from it for so acting or of any basis for such a claim
except the case of the Company, for Robinson Humphrey Company LLC
pursuant to the terms of the Engagement Letter previously provided to
the Purchaser.
Section 12.13. Certain Assignment of Rights. Prior to Closing,
neither party shall be entitled to assign any of its rights hereunder.
Section 12.14 Effective Date. The parties hereby acknowledge and
agree that, notwithstanding the date of the execution of this
Agreement, the effective date for this Agreement shall be as of
September 13, 1999.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Agreement, as of the day and year first above written.
COMPANY PURCHASER
BOCA RESEARCH, INC. NATIONAL SEMICONDUCTOR CORPORATION
By:/s/ Anthony F. Zalenksi By: /s/ Donald MacLeod
--------------------------- --------------------------------
Name: Anthony F. Zalenski Name: Donald MacLeod
Title: President/Chief Executive Officer Title: Chief Financial Officer
