UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
Catalyst International, Inc.
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(Name of Issuer)
Common Stock, $0.10 par value
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(Title of Class of Securities)
14887T 10 5
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(CUSIP Number)
Morton E. Grosz, Esq.
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112
(212) 408-5592
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 31, 1999
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rules 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box. |_|
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
______________________
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 7 Pages
<PAGE>
SCHEDULE 13D
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CUSIP No. 14887T 10 5 Page 2 of 7 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
SAP Aktiengesellschaft Systeme, Anwendungen, Produkte in der
Datenverarbeitung
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A
GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Federal Republic of Germany
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- -------------------- ------- ---------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
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------- ---------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 759,485
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EACH
9 SOLE DISPOSITIVE POWER
REPORTING
-0-
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------- ---------------------------------------------------
PERSON
10 SHARED DISPOSITIVE POWER
WITH
759,485
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
759,485 shares owned indirectly through its wholly-owned subsidiary
SAP America, Inc.
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
SEE ITEM 2. |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Approximately 9.7% of the shares outstanding as of August 31, 1999
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14 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
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CUSIP No. 14887T 10 5 Page 3 of 7 Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
SAP America, Inc.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
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------- ---------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 759,485
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EACH
9 SOLE DISPOSITIVE POWER
REPORTING
-0-
------- ---------------------------------------------------
------- ---------------------------------------------------
PERSON
10 SHARED DISPOSITIVE POWER
WITH
759,485
- -------------------- ------- ---------------------------------------------------
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
759,485 shares owned directly
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
SEE ITEM 2. |_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Approximately 9.7% of the shares outstanding as of August 31, 1999
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14 TYPE OF REPORTING PERSON*
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
CUSIP No. 14887T 10 5 13D Page 4 of 7 Pages
SCHEDULE 13D
Under the
Securities Exchange Act of 1934
Item 1. Security and Issuer.
This statement relates to the Common Stock, $0.10 par value
("Common Stock") of Catalyst International, Inc. (the "Issuer"). The principal
executive offices of the Issuer are located at 8989 North Deerwood Drive,
Milwaukee, Wisconsin 53223.
Item 2. Identity and Background.
The persons filing this Statement (the "Reporting Person"),
the persons enumerated in Instruction C of Schedule 13D (the "Additional
Persons") and, where applicable, their respective places of organization,
directors, executive officers and controlling persons, and the information in
respect of such persons, are as follows:
(a) The names of the Reporting Persons are SAP
Aktiengesellschaft Systeme, Anwendungen, Produkte in der Datenverarbeitung ("SAP
AG") and SAP America, Inc. ("SAP America"). The names of the Additional Persons
are as follows:
Directors and Officers of SAP AG
Prof. Dr. Hasso Plattner ("Plattner"); Dietmar Hopp ("Hopp"); Dr. Wilhelm
Haarmann ("Haarmann"); Klaus-Dieter Laidig ("Laidig"); Hartmut Mehdorn
("Mehdorn"); Dr. Dieter Spori ("Spori"); Dr. h.c. Klaus Tschira ("Tschira");
Helga Classen ("Classen"), Willi Burbach ("Burbach"); Bernhard Koller
("Koller"); Dr. Gerhard Maier ("Maier"); Dr. Barbara Schennerlein
("Schennerlein"); Alfred Simon ("Simon"); Prof. Dr. Henning Kagermann
("Kagermann"); Dr. Peter Zencke ("Zencke"); Dr. Claus Heinrich ("Heinrich");
Gerhard Oswald ("Oswald"); Dieter Matheis ("Matheis"); Kevin McKay ("McKay");
Leslie Hayman ("Hayman"); Karl-Heinz Hess ("Hess"); and Leo Apotheker
("Apotheker").
Directors and Officers of SAP America
Plattner; McKay; Eric N. Rubino ("Rubino"); John Milana ("Milana").
(b) The principal business address of SAP AG is Neurottstrasse
16, 69189 Walldorf, Federal Republic of Germany. The principal business address
of SAP America is 3999 West Chester Pike, Newtown Square, Pennsylvania, 19073.
(c) Plattner is the Co-Speaker of the Executive Board of SAP
AG and the Chairman of the Board of SAP America. Hopp is the Chairman of the
Supervisory Board of SAP AG. Haarmann is a member of the Supervisory Board of
SAP AG and a partner of Haarmann, Hemmelrath & Partners, which is located at
Neue Mainzer Strasse 75, 60311 Frankfurt, Germany. Laidig is a member of the
Supervisory Board of SAP AG and Managing Partner of Laidig Business Consulting
GmbH, located at Taunusstr. 8, 71032 Boblingen,
<PAGE>
CUSIP No. 14887T 10 5 13D Page 5 of 7 Pages
Germany. Mehdorn is a member of the Supervisory Board of SAP AG, Chairman of the
Executive Board of Heidelberger Druckmaschinen AG, located at Kurfursten-Anlage
52-60, 69115 Heidelberg, Germany, and a Member of the Executive Boards of RWE AG
and Lahmeyer AG. Spori is a member of the Supervisory Board of SAP AG, a Partner
of Baumgartner & Partner Unternehmensberatung GmbH, located at Kolumbusstr. 2,
70063 Sindelfingen, Germany, and a Consultant of DaimlerChrysler AG, located at
Eichhornstr. 3, 10785 Berlin, Germany. Tschira is a member of the Supervisory
Board of SAP AG and a former Member of SAP's Executive Board. Classen is the
Vice Chairman of the Supervisory Board of SAP AG and an employee of SAP AG.
Burbach, Koller, Maier, Schennerlein and Simon are members of the Supervisory
Board of SAP AG and employees of SAP AG. Kagermann is Co-Speaker of the
Executive Board of SAP AG. Zencke, Heinrich and Oswald are members of the
Executive Board of SAP AG. Matheis is Chief Financial Officer and a member of
the Extended Management Board of SAP AG. Hayman, Hess and Apotheker are members
of the Extended Management Board of SAP AG. McKay is President and Chief
Executive Officer, and a member of the Board of Directors, of SAP America, and a
member of the Extended Management Board of SAP AG. Rubino is Senior Vice
President, Secretary and General Counsel of SAP America. Milana is Senior Vice
President and Chief Financial Officer of SAP America.
(d) During the last five years, neither SAP AG nor SAP
America, nor to the knowledge of SAP AG or SAP America, the Additional Persons,
have been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) During the last five years, neither SAP AG nor SAP
America, nor to the knowledge of SAP AG or SAP America, the Additional Persons,
have been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) SAP AG is a corporation organized under the laws of the
Federal Republic of Germany. SAP America is a corporation organized under the
laws of the State of Delaware. Plattner, Hopp, Haarmann, Laidig, Mehdorn, Spori,
Tschira, Classen, Burbach, Koller, Maier, Schennerlein, Simon, Kagermann,
Zencke, Heinrich, Oswald, Matheis and Hess are citizens of the Federal Republic
of Germany. McKay, Rubino and Milana are citizens of the United States of
America. Apotheker is a citizen of France. Hayman is a citizen of Australia.
Item 3. Source and Amount of Funds or Other Considerations.
The source and amount of the funds used in purchasing the
Common Stock was the working capital of SAP America. The amount of such purchase
price was $12,911,245.
Item 4. Purpose of Transaction.
The purpose of the acquisition of the Common Stock by the
Reporting Persons is to acquire an equity interest in the Issuer for investment
purposes.
Subject to the provisions of the Subscription Agreement (as
defined below), the Reporting Person may, from time to time, increase, reduce or
dispose of its investment in
<PAGE>
CUSIP No. 14887T 10 5 13D Page 6 of 7 Pages
the Issuer, depending upon the business affairs of the Issuer, general economic
conditions, economic conditions in the markets in which the Issuer operates, the
market price of the Common Stock, alternative investment opportunities available
to the Reporting Persons, the strategic value to the Reporting Persons of the
Common Stock, the availability of funds, borrowing costs and other factors
deemed relevant by the Reporting Persons.
Item 5. Interest in Securities of the Issuer.
The beneficial ownership of the Common Stock of SAP AG is
759,485 shares, as to which shares SAP AG has shared voting and shared
dispositive power. The beneficial ownership of the Common Stock of SAP America
is 759,485 shares, as to which shares SAP America has shared voting and shared
dispositive power. None of the Additional Persons have any beneficial ownership
of the Common Stock.
Pursuant to a certain Subscription Agreement among SAP AG, SAP
America and the Issuer dated August 31, 1999, filed herewith as Exhibit 1 and
incorporated by reference herein (the "Subscription Agreement"), SAP America
purchased 759,485 shares of Common Stock for a total cash consideration of
$12,911,245, or $17 per share. The foregoing description of the Subscription
Agreement is qualified in its entirety by reference to the Subscription
Agreement, which is filed herewith as Exhibit 1, and which is incorporated into
this Statement by reference. The above-described transaction by the Reporting
Persons is the only transaction effected by the Reporting Persons in the Common
Stock since June 30, 1999.
Item 6. Contract, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
A description of the Subscription Agreement with respect to
the Common Stock is contained in Item 5 and is incorporated herein by reference.
See the Subscription Agreement, filed herewith as Exhibit 1, for a further
description of these provisions.
Item 7. Material to be filed as Exhibits.
Exhibit 1. Subscription Agreement among SAP Aktiengesellschaft,
SAP America, Inc. and Catalyst International, Inc. dated
August 31, 1999.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I hereby certify that the information set forth in this Statement is
true, complete and correct.
Dated: September 9, 1999 SAP AKTIENGESELLSCHAFT SYSTEME,
ANWENDUNGEN, PRODUKTE IN DER
DATENVERARBEITUNG
By: /s/ Henning Kagermann
Name: Prof. Dr. Henning Kagermann
Title: Co-Chairman and CEO
By: /s/ Dieter Matheis
Name: Dieter Matheis
Title: Chief Financial Officer
Dated: September 10, 1999 SAP AMERICA, INC.
By: /s/ Eric N. Rubino
Name: Eric N. Rubino
Title: Sr. Vice President, General
Counsel & Secretary
================================================================================
SUBSCRIPTION AGREEMENT
AMONG
SAP AMERICA, INC.,
SAP AKTIENGESELLSCHAFT
AND
CATALYST INTERNATIONAL, INC.
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Dated as of August 31, 1999
----------------------------
================================================================================
<PAGE>
SUBSCRIPTION AGREEMENT
TABLE OF CONTENTS
Page
ARTICLE I PURCHASE AND SALE...................................................1
Section 1.1. Purchase and Sale..........................................1
Section 1.2. Certificates...............................................2
ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY......................3
Section 2.1. Organization; Capitalization...............................3
Section 2.2. Authority..................................................4
Section 2.3. No Breach..................................................5
Section 2.4. SEC Filings................................................5
Section 2.5. Absence of Certain Events and Changes......................6
Section 2.6. Intellectual Property......................................7
Section 2.7. Litigation.................................................9
Section 2.8. Governmental Approvals.....................................9
Section 2.9. Compliance With Applicable Law.............................9
Section 2.10. Licenses; Permits........................................10
Section 2.11. Taxes....................................................10
Section 2.12. Investment Company.......................................11
ARTICLE III REPRESENTATIONS AND WARRANTIES OF PURCHASER AND PARENT...........11
Section 3.1. Organization..............................................11
Section 3.2. Authority.................................................11
Section 3.3. No Breach.................................................12
Section 3.4. Governmental Approvals....................................12
Section 3.5. Investment Intent.........................................13
Section 3.6. Disclosure of Information.................................13
Section 3.7. Accredited Investor Status................................13
Section 3.8. Restricted Shares.........................................13
SECTION 3.9. Financial Warranty........................................14
ARTICLE IV COVENANTS.........................................................14
Section 4.1. Covenants of Purchaser and Parent.........................14
Section 4.2. Covenants of the Company..................................23
Section 4.3. Director Nominee..........................................25
Section 4.4. Public Announcements......................................26
Section 4.5. Further Action............................................26
ARTICLE V SURVIVAL...........................................................27
Section 5.1. Survival..................................................27
i
<PAGE>
ARTICLE VI ASSIGNMENT; PARTIES IN INTEREST; AMENDMENT; WAIVER................27
Section 6.1. Assignment................................................27
Section 6.2. Parties in Interest.......................................28
Section 6.3. Amendment.................................................28
Section 6.4. Waiver....................................................28
ARTICLE VII GENERAL PROVISIONS...............................................28
Section 7.1. Effect of Investigation...................................28
Section 7.2. Fees and Expenses.........................................29
Section 7.3. Notices...................................................29
Section 7.4. Brokers; Fee Schedule.....................................30
Section 7.5. Captions, Currency........................................30
Section 7.6. Entire Agreement..........................................31
Section 7.7. Specific Performance......................................31
Section 7.8. Severability..............................................31
Section 7.9. Governing Law.............................................31
Section 7.10. Counterparts.............................................32
ii
<PAGE>
SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT dated as of August 31, 1999 among SAP AMERICA,
INC., a Delaware corporation ("Purchaser"), SAP AKTIENGESELLSCHAFT, a stock
corporation incorporated under the laws of the Federal Republic of Germany
("Parent"), and CATALYST INTERNATIONAL, INC., a Delaware corporation (the
"Company");
W I T N E S S E T H :
WHEREAS, Purchaser desires to purchase from the Company, and the
Company desires to issue and sell to Purchaser, 759,485 shares of Common Stock,
$0.10 par value (the "Common Stock"), of the Company (the "Shares") upon the
terms and conditions hereinafter set forth; and
WHEREAS, concurrently with the execution and delivery of this
Agreement, Parent and the Company have entered into (i) the Software
Implementation, Support and Joint-Marketing Cooperation Agreement dated as of
the date hereof (the "Cooperation Agreement") with respect to certain commercial
arrangements between the parties and (ii) the Joint Development Agreement dated
as of the date hereof (the "Development Agreement") with respect to the joint
development of an advanced interface between certain of the parties' software
products;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements hereinafter contained, the parties hereto do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE
SECTION 1.1. Purchase and Sale. Subject to all of the terms and
conditions of this Agreement, the Company hereby issues and sells to Purchaser,
and Purchaser hereby subscribes for and purchases from the Company, the Shares
at a purchase price of $17 per share, for an aggregate purchase price of
$12,911,245 (the "Purchase Price") to be paid by wire transfer of immediately
available funds against delivery of the certificate or certificates for the
Shares.
<PAGE>
SECTION 1.2. Certificates. (a) On the date hereof, the Company shall
deliver to Purchaser, against the payment of the Purchase Price, a certificate
or certificates evidencing the Shares. Each certificate shall bear the following
legend:
"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE (A) HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
STATE SECURITIES LAWS AND MUST BE REGISTERED UNDER SAID ACT AND LAWS OR
DISPOSED OF PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION AND (B) THE
TRANSFER, SALE, GIFT, ASSIGNMENT, PLEDGE, ENCUMBRANCE, CONVEYANCE OR OTHER
DISPOSITION OF THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO THE TERMS OF THE SUBSCRIPTION AGREEMENT DATED AS OF AUGUST 31,
1999, AMONG SAP AMERICA, INC., SAP AKTIENGESELLSCHAFT AND CATALYST
INTERNATIONAL, INC., A COPY OF WHICH IS ON FILE AT THE OFFICE OF CATALYST
INTERNATIONAL, INC."
(b)(i) Upon the expiration of the Restricted Period (as defined in Section
4.1(a)) and surrender of the certificate or certificates evidencing the
Shares, Purchaser may request, and the Company shall upon such request
issue in exchange for such certificate or certificates surrendered, a new
certificate or certificates for the same number of Shares bearing the
following legend:
"THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
STATE SECURITIES LAWS AND MUST BE REGISTERED UNDER SAID ACT AND LAWS OR
DISPOSED OF PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION."
(ii) Until the expiration of the Restricted Period, in connection with a
Transfer (as defined in Section 4.1(a)) of Shares permitted pursuant to
Section 4.1(a)(ii), 4.1(a)(iii) or 4.1(a)(iv), upon surrender of the
certificate or certificates evidencing such Shares permitted to be
Transferred, the Company shall issue in exchange for such certificate or
certificates surrendered (A) a new certificate or certificates evidencing
such number of Shares as Purchaser is permitted to Transfer pursuant to
Section 4.1(a)(ii), 4.1(a)(iii) or 4.1(a)(iv) bearing the legend set forth
in Section 1.2(b)(i) and (B) an additional certificate or certificates
evidencing the balance, if any, of Shares remaining subject to the
restrictions on
2
<PAGE>
Transfer of Section 4.1(a)(i) bearing the legend set forth in Section
1.2(a).
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Purchaser as
follows:
SECTION 2.1. Organization; Capitalization. (a) The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware with all requisite corporate power and authority to own
its properties and to carry on its business as presently conducted. The Company
is duly qualified and in good standing to transact business as a foreign
corporation in each jurisdiction in which the conduct or nature of its business
or the ownership, leasing or holding of its properties makes such qualification
necessary, except where the failure to be so qualified would not have,
individually or in the aggregate, a Material Adverse Effect (as defined below).
For purposes of this Agreement, "Material Adverse Effect" shall mean a material
adverse effect on the business, condition (financial or otherwise), assets,
liabilities, properties, operations or results of operations of the Company and
its subsidiaries, taken as a whole, or on the ability of the Company to
consummate the transactions contemplated by this Agreement, the Cooperation
Agreement or the Development Agreement.
(b) The authorized capital stock of the Company consists of 27,000,000
shares, divided into (i) 2,000,000 shares of Preferred Stock, none of which are
issued and outstanding or held in the treasury of the Company, and (ii)
25,000,000 shares of Common Stock, $0.10 par value, of which prior to the sale
of the Shares hereunder 7,073,416 shares are issued and outstanding, 1,822,753
shares are held in the treasury of the Company, 1,884,833 shares are reserved
for issuance upon exercise of outstanding stock options granted pursuant to the
Company's 1993 Stock Option Plan and the Company's 1997 Director Stock Option
Plan (collectively, the "Stock Option Plans"), and the remainder are unissued
and not reserved. All the outstanding shares of Common Stock are duly
authorized, validly issued, fully paid and nonassessable and the Shares are duly
authorized and, when issued, will be validly issued, fully paid and
nonassessable, except as to nonassessability as provided in
3
<PAGE>
Wisconsin Statutes Section 180.0622(2)(b) and the cases decided thereunder.
Under the Stock Option Plans, options granted by the Company to purchase
1,884,833 shares of Common Stock are outstanding on the date hereof and options
granted by the Company to purchase 906,740 shares of Common Stock are
exercisable on the date hereof. Except for (A) such options and the agreements
entered into in connection with the issuances thereof and (B) a warrant to
purchase 10,000 shares of Common Stock held by Mark T. Ehrmann (the "Warrant"),
(1) there are no outstanding securities or obligations convertible into or
exchangeable for, or options, warrants, scrip, rights to subscribe for or
acquire, calls or commitments of any character whatsoever relating to, or
contracts, understandings or arrangements with respect to the issuance or sale
of, any shares of the capital stock of the Company or any other securities of
the Company, or arrangements or contracts with respect to the purchase,
repurchase, sale, redemption, acquisition, conversion, exchange, registration,
transfer or voting of shares of its capital stock and (2) the Company is not
obligated, now or in the future, contingently or otherwise, to issue Common
Stock or any other of its securities to any person or entity. The Company has
outstanding no bonds, debentures, notes or other obligations the holders of
which have the right to vote (or which are convertible or exchangeable into or
exercisable for securities having the right to vote) with the shareholders of
the Company on any matter.
SECTION 2.2. Authority. The Company has all requisite corporate power and
authority to execute, deliver and perform this Agreement, the Cooperation
Agreement and the Development Agreement and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance of this
Agreement, the Cooperation Agreement and the Development Agreement by the
Company and the consummation of the transactions contemplated hereby and thereby
have been duly authorized by all necessary corporate action on the part of the
Company. This Agreement, the Cooperation Agreement and the Development Agreement
have been duly executed and delivered by the Company and constitute the valid
and binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as such enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws relating to or affecting the enforcement of creditors' rights in
general and by general principles of equity.
4
<PAGE>
SECTION 2.3. No Breach. The execution, delivery and performance of this
Agreement, the Cooperation Agreement and the Development Agreement by the
Company do not, and the consummation of the transactions contemplated hereby and
thereby and compliance with the provisions hereof and thereof will not, with or
without the giving of notice or the lapse of time, or both, (a) conflict with,
or result in a breach or violation of or a default under, or give rise to a
right of amendment, termination, cancellation or acceleration of any obligation
or to a loss of a material benefit under (i) the Restated Certificate of
Incorporation or By-laws of the Company or the certificates of incorporation or
the by-laws (or the equivalent thereof) of any of its subsidiaries, or (ii) any
contract, agreement, note, bond, mortgage, indenture, lease, license, franchise,
permit, concession, instrument, obligation, commitment, covenant, understanding
or arrangement to which the Company or any of its subsidiaries is a party or by
which any of their respective properties or assets may be affected (a
"Contract"), or (iii) any order, ruling, decree, judgment, arbitration award,
statute, law, ordinance, rule, regulation or stipulation to which the Company or
any of its subsidiaries or their respective properties or assets is subject, or
(b) result in the creation of any restriction on voting or transfer, pledge,
claim, lien, charge, encumbrance or security interest of any kind (a "Lien")
upon any of the properties or assets of the Company or any of its subsidiaries,
except, in the case of items (a)(ii) and (iii) above and any such Liens, for
those which would not have, individually or in the aggregate, a Material Adverse
Effect.
SECTION 2.4. SEC Filings. (a) The Company has filed all reports, schedules,
forms, statements and other documents required to be filed with the Securities
and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "Securities Act"), and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the date on which the Company became subject to such
requirements (the "SEC Filings"). As of its filing date, each SEC Filing filed
(i) complied in all material respects with the applicable requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and regulations
thereunder and (ii) did not, at the time it was filed (and at the effective date
thereof, in the case of a registration statement), contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. Except to the extent
that information
5
<PAGE>
contained in any SEC Filing has been revised, corrected or superseded by a
later filed SEC Filing, as of the date hereof, none of the SEC Filings contains
any untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(b) The financial statements of the Company included in the SEC Filings
comply as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC and with
generally accepted accounting principles (except, in the case of unaudited
statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis
during the periods involved (except as may be indicated in the notes thereto).
Each of the consolidated balance sheets included in or incorporated by reference
into the SEC Filings (including any related notes and schedules) fairly presents
in all material respects the consolidated financial position of the Company and
its subsidiaries as of its date and each of the consolidated statements of
income, cash flows and stockholders' equity included in or incorporated by
reference into the SEC Filings (including any related notes and schedules)
fairly presents in all material respects the consolidated results of operations,
retained earnings and cash flows, as the case may be, of the Company and its
subsidiaries for the periods set forth therein (subject, in the case of
unaudited statements, to normal year-end adjustments and the absence of
footnotes), in each case in accordance with generally accepted accounting
principles.
SECTION 2.5. Absence of Certain Events and Changes. Since June 30, 1999,
neither the Company nor any of its subsidiaries has incurred any liabilities or
obligations other than those arising from operations in the ordinary course of
business consistent with past practice. Since December 31, 1998, the Company and
its subsidiaries have conducted their respective businesses only in the ordinary
course consistent with past practice and, except as disclosed in the SEC Filings
filed with the SEC and publicly available prior to the date hereof, there has
been no change in or development with respect to the business, condition
(financial or otherwise), assets, liabilities, properties, operations or results
of operations of the Company and its subsidiaries except changes in and
developments with respect to the ordinary course of business of the Company
consistent with past practice which have not had or may not reasonably
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be expected to have, individually or in the aggregate, a Material Adverse
Effect.
SECTION 2.6. Intellectual Property.
(a)(i) The Company and its subsidiaries own or have the right to use
under license or otherwise all of the Intellectual Property (as defined
below), free from any Liens and free from any requirement of any past,
present or future payments (other than maintenance and similar
payments), charges or fees or conditions, rights or restrictions,
except for royalties or license fees for licensed Intellectual
Property;
(ii) to the knowledge of the Company and its subsidiaries, no
Intellectual Property or any service rendered by the Company or any
subsidiary, or any product, process or material used by the Company or
any subsidiary, infringes upon any intellectual property rights of any
other person or entity;
(iii)(A) with respect to Intellectual Property owned by the Company and
its subsidiaries there is neither pending nor, to the knowledge of the
Company and its subsidiaries, threatened, and (B) with respect to
licensed Intellectual Property, to the knowledge of the Company and its
subsidiaries, there is neither pending nor threatened, any claim or
litigation against the Company or its subsidiaries with respect to the
ownership, validity, infringement, enforceability or use of any
Intellectual Property;
(iv) no Intellectual Property owned by the Company or its subsidiaries
is subject to any outstanding order, ruling, decree, judgment or
stipulation by any arbitrator, court or other Governmental Entity, nor
is there any pending or, to the knowledge of the Company and its
subsidiaries, threatened proceeding relating thereto;
(v) to the knowledge of the Company and its subsidiaries, there is no
infringement or misappropriation of the Intellectual Property by any
other person or entity; and
(vi) no person or entity has any licenses under any of the Intellectual
Property owned by the Company or its subsidiaries (including any rights
or licenses, or options to acquire such rights and licenses, which
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survive any agreements or licenses that have terminated or expired
prior to the date hereof),
except in each of clauses (i)-(vi) above such as would not have a Material
Adverse Effect.
(b) The Company and its subsidiaries have taken reasonable steps
(including measures to protect secrecy and confidentiality) to protect its
right, title and interest in and to the Intellectual Property. All employees,
agents, consultants and other representatives of the Company and its
subsidiaries who have access to confidential or proprietary information of the
Company and its subsidiaries incorporated in the Intellectual Property have
entered into confidentiality agreements with the Company and the Company
believes that such agreements are enforceable.
For purposes of this Agreement, "Intellectual Property" shall mean all
of the following owned or used by the Company and its subsidiaries: (1) all
inventions (whether patentable or unpatentable and whether or not reduced to
practice), all improvements thereto, and all patents, patent applications, and
patent or invention disclosures, together with all reissuances, continuations,
continuations-in-part, divisions, revisions, extensions and re-examinations
thereof; (2) all copyrightable works, all copyrights and all applications,
registrations and renewals in connection therewith; (3) all trade secrets and
confidential business and technical information (including ideas, research and
development, know-how, technical data, designs, engineering notebooks, software
and specifications); (4) all computer software, both source code and object code
(including data and related documentation, flow charts, diagrams, descriptive
texts and programs, computer print-outs, underlying tapes, computer databases
and similar items); (5) all trademarks, service marks, trade names, trade dress,
logos, business and product names, slogans, and registrations and applications
for registration thereof; (6) all rights to sue for and remedies against past,
present and future infringements of any or all of the foregoing and rights of
priority and protection of interests therein under the laws of any jurisdiction
worldwide; (7) all copies and tangible embodiments of any or all of the
foregoing (in whatever form or medium, including without limitation electronic
media); and (8) all other proprietary, intellectual property and other rights
relating to any or all of the foregoing.
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SECTION 2.7. Litigation. Except as set forth in the SEC Filings, there
are no claims, actions, suits, proceedings or investigations pending or, to the
knowledge of the Company and its subsidiaries, threatened against the Company or
any of its subsidiaries, or any properties or rights owned or leased by the
Company or any of its subsidiaries (including any such claims, actions, suits,
proceedings or investigations relating to environmental matters), before any
court, administrative, governmental or regulatory authority or body, arbitration
panel or other Governmental Entity (as defined in Section 2.8), which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect (whether or not covered by insurance) or which relate to
the transactions contemplated by this Agreement, the Cooperation Agreement or
the Development Agreement, and neither the Company nor any of its subsidiaries
knows, after reasonable inquiry of its senior management, of any basis for any
such claim, action, suit, proceeding or investigation. Neither the Company nor
any of its subsidiaries nor any property owned or leased by them is subject to
any order, judgment, injunction or decree which could reasonably be expected to
have a Material Adverse Effect.
SECTION 2.8. Governmental Approvals. Except for applicable requirements
of the Exchange Act and the rules and regulations thereunder and of the Nasdaq
Stock Market, Inc. ("Nasdaq") no approval, order or authorization of, or filing
or registration with, allowance by, or consent of or notification to any
federal, state or local government or any court, administrative or regulatory
agency or commission or other governmental authority or agency, domestic or
foreign (a "Governmental Entity"), is required to be obtained or made by the
Company or any of its subsidiaries in connection with the execution and delivery
of this Agreement, the Cooperation Agreement and the Development Agreement, the
performance of obligations of the Company hereunder or thereunder or the
consummation by the Company of the transactions contemplated hereby or thereby
or for preventing the termination of any material right, privilege or contract
of the Company or any of its subsidiaries.
SECTION 2.9. Compliance With Applicable Law. (a) The Company and its
subsidiaries are in compliance with all applicable laws, ordinances and
regulations of any Governmental Entity, including those relating to
environmental, occupational health and safety, fair employment and equal
opportunity, (b) no claims or complaints from any Governmental Entities or other
parties
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have been asserted or received by the Company or any of its subsidiaries during
the past three years, and, to the knowledge of the Company and its subsidiaries,
no claims or complaints are threatened, alleging that the Company or any of its
subsidiaries is in violation of any such law, ordinance or regulation, and (c)
neither the Company nor any of its subsidiaries has received notice from any
Governmental Entity of any pending proceedings to take all or any part of the
properties of the Company or any of its subsidiaries (whether leased or owned)
by condemnation or right of eminent domain and, to the knowledge of the Company
and its subsidiaries, no such proceedings are threatened, except, in each such
case, for such noncompliance, claims, complaints or proceedings which would not
have, individually or in the aggregate, a Material Adverse Effect.
SECTION 2.10. Licenses; Permits. (a) The Company has all licenses,
permits, approvals and other authorizations ("Permits") from all Governmental
Entities as are necessary for the conduct of the business or operations of the
Company and its subsidiaries, in a manner consistent with good business practice
and in compliance with all laws applicable to such business operations and (b)
all such Permits are validly held by the Company or the relevant subsidiary, are
in full force and effect and the same will not be subject to suspension,
modification, revocation or nonrenewal as a result of the execution, delivery
and performance of this Agreement, the Cooperation Agreement or the Development
Agreement or the consummation of the transactions contemplated hereby or
thereby, except in the case of clauses (a) and (b) where such failure to hold
such Permits would not have, individually or in the aggregate, a Material
Adverse Effect.
SECTION 2.11. Taxes. The Company has filed all tax returns, reports and
forms (including statements of estimated taxes owed) required to be filed within
the applicable periods for such filings and has paid all taxes required to be
paid, and has established adequate reserves (net of estimated tax payments
already made) for the payment of all taxes payable in respect to the period
subsequent to the last periods covered by such returns. All such tax returns,
reports and forms are true, correct and complete in all material respects. No
deficiencies for any tax are currently assessed against the Company, and, to the
knowledge of the Company, there is no audit of the Company's tax returns pending
or contemplated. Proper and adequate amounts have been withheld by the Company
from its employees and other persons for all periods in compliance in all
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material aspects with the tax, social security and unemployment and other
withholding provisions of all federal, state, local and foreign laws. There is
no tax lien, whether imposed by any federal, state or local taxing authority,
outstanding against the assets, properties or business of the Company. For the
purposes of this agreement, the term "tax" shall include all Federal, state,
local and foreign taxes, including income, franchise, property, sales, use,
gross receipts, excise, withholding, payroll and employment taxes and other
similar assessments of any kind whatsoever, including all interest, penalties
and additions imposed with respect to such amounts.
SECTION 2.12. Investment Company. The Company is not an "investment
company" or a person directly or indirectly controlled by or acting on behalf of
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF PURCHASER and parent
Purchaser and Parent hereby jointly and severally represent and warrant
to the Company as follows:
SECTION 3.1. Organization. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Parent is a corporation duly organized and validly existing under the laws of
the Federal Republic of Germany.
SECTION 3.2. Authority. Purchaser has all requisite corporate power and
authority to execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby, and Parent has all requisite corporate power
and authority to execute, deliver and perform this Agreement, the Cooperation
Agreement and the Development Agreement and to consummate the transactions
contemplated hereby and thereby. The execution, delivery and performance of this
Agreement by Purchaser and Parent and the consummation of the transactions
contemplated hereby and the execution, delivery and performance of the
Cooperation Agreement and the Development Agreement by Parent and the
consummation of the transactions contemplated thereby have been duly authorized
by all necessary corporate action on the part of Purchaser and/or Parent, as the
case may be.
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This Agreement, the Cooperation Agreement and the Development Agreement have
been duly executed and delivered by Purchaser and/or Parent, as the case may be,
and constitute the valid and binding obligations of Purchaser and/or Parent, as
the case may be, enforceable against Purchaser and/or Parent, as the case may
be, in accordance with their terms, except as such enforceability may be limited
by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
similar laws relating to or affecting the enforcement of creditors' rights in
general and by general principles of equity.
SECTION 3.3. No Breach. The execution, delivery and performance of this
Agreement by Purchaser and the execution, delivery and performance of this
Agreement, the Cooperation Agreement or the Development Agreement by Parent do
not, and consummation of the transactions contemplated hereby and thereby and
compliance with the provisions hereof and thereof will not, with or without the
giving of notice or the lapse of time, or both, (a) conflict with or result in a
breach or violation of or a default under, or give rise to a right of amendment,
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit under, (i) the Certificate of Incorporation or By-laws of
Purchaser or the organizational documents of Parent, or (ii) any contract,
agreement, note, bond, mortgage, indenture, lease, license, franchise, permit,
concession, instrument, obligation, commitment, covenant, understanding or
arrangement to which Purchaser or Parent is a party or by which any of their
respective properties or assets may be affected, or (iii) any order, ruling,
decree, judgment, arbitration award, statute, law, ordinance, rule, regulation
or stipulation to which Purchaser or Parent or their respective properties or
assets is subject, or (b) result in the creation of any Lien upon any of their
respective properties or assets, except, in the case of items (a)(ii) and (iii)
above and any such Liens, for those which would not have, individually or in the
aggregate, a material adverse effect on the ability of Purchaser and/or Parent,
as the case may be, to consummate the transactions contemplated by this
Agreement, the Cooperation Agreement or the Development Agreement.
SECTION 3.4. Governmental Approvals. Except for the applicable
requirements of the Exchange Act and the rules and regulations thereunder, no
approval, order or authorization of, or filing or registration with, allowance
by, or consent of or notification to any Governmental Entity is required to be
obtained or made by Purchaser or Parent in
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connection with the execution and delivery of this Agreement, the Cooperation
Agreement or the Development Agreement, the performance of obligations of
Purchaser or Parent hereunder or thereunder or the consummation by Purchaser or
Parent of the transactions contemplated hereby or thereby.
SECTION 3.5. Investment Intent. The Shares to be subscribed for by
Purchaser hereunder will be subscribed for investment for such Purchaser's own
account, not as a nominee or agent, and not with a view to the public resale or
distribution thereof within the meaning of the Securities Act, and Purchaser has
no present intention of selling, granting any participation in, or otherwise
distributing the same. Purchaser also represents that it has not been formed for
the specific purpose of subscribing for the Shares and that neither Purchaser,
Parent nor any of the Control Subsidiaries (as defined in Section 4.1(d)) owns
or has ever owned any shares of Common Stock.
SECTION 3.6. Disclosure of Information. Purchaser has received or has
had full access to all the information it considers necessary or appropriate to
make an informed investment decision with respect to the Shares to be subscribed
for by Purchaser under this Agreement. Purchaser further has had an opportunity
to ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Shares and to obtain additional information
(to the extent the Company possessed such information or could acquire it
without unreasonable effort or expense) necessary to verify any information
furnished to Purchaser or to which Purchaser had access. The foregoing, however,
does not in any way limit or modify the representations and warranties made by
the Company in Article II.
SECTION 3.7. Accredited Investor Status. Purchaser is an "accredited
investor" within the meaning of Rule 501(a) of Regulation D promulgated under
the Securities Act.
SECTION 3.8. Restricted Shares. Purchaser is aware that the Shares
issued pursuant to this Agreement have not been registered under the Securities
Act or any applicable state securities laws, and agrees that the Shares will not
be offered or sold in the absence of registration under the Securities Act and
any applicable state securities laws or an exemption from the registration
requirements of the Securities Act and any applicable state securities laws.
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Purchaser will not transfer any Shares in violation of the provisions of any
applicable federal or state securities laws. In this connection, Purchaser
represents that it is familiar with SEC Rule 144 promulgated pursuant to the
Securities Act ("Rule 144"), as presently in effect, and understands the resale
limitations imposed thereby and by the Securities Act. Purchaser understands
that the offering and sale of the Shares is intended to be exempt from
registration under the Securities Act, by virtue of Section 4(2) of the
Securities Act and, if applicable, the provisions of Regulation D promulgated
thereunder, based, in part, upon the representations, warranties and agreements
contained in this Agreement.
SECTION 3.9. Financial Warranty. Purchaser has been in existence for at
least 18 months and has a tangible net worth on a consolidated basis of $10
million or more.
ARTICLE IV
COVENANTS
SECTION 4.1. Covenants of Purchaser and Parent.
(a) Restrictions on Transfer. (i) Except as permitted by Sections
4.1(a)(ii), 4.1(a)(iii), 4.1(a)(iv) and 4.1(b), Purchaser, Parent and any
subsidiary controlled by Purchaser or Parent (a "Control Subsidiary") shall
not Transfer (as defined below) any of the Shares prior to the expiration
of the Restricted Period (as defined below) without the prior written
approval of the Company. Any attempted Transfer of Shares other than in
accordance with this Agreement shall be null and void and the Company shall
refuse to recognize any such Transfer and shall not reflect on its records
any change in record ownership of Shares pursuant to any such Transfer.
(ii) Unless the Restricted Period has previously expired, during
the period beginning on the third anniversary of the date hereof and ending
upon the expiration of the Restricted Period, Purchaser, Parent and their
Control Subsidiaries may Transfer, in the aggregate, not more than that
number of Shares equal to 10% of the largest number of shares of Common
Stock held by Purchaser, Parent and their Control Subsidiaries,
collectively, at any point during such period.
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(iii) Notwithstanding the provisions of Sections 4.1(a)(i) and
4.1(a)(ii), (A) in the event of a tender, exchange or other offer by a
third party and/or its affiliates for all or at least 20% of the then
outstanding shares of Common Stock at any time during the Restricted
Period, Purchaser, Parent and their Control Subsidiaries may tender any of
the Shares in such tender, exchange or other offer and upon consummation of
such tender, exchange or other offer, Transfer the Shares tendered to the
purchaser and (B) Purchaser, Parent and their Control Subsidiaries may
tender any of the Shares to the Company at any time in connection with a
tender, exchange or other offer by the Company for shares of Common Stock
(a "Company Tender") and upon consummation of such Company Tender, Transfer
the Shares tendered to the Company.
(iv) Notwithstanding the provisions of Sections 4.1(a)(i) and
4.1(a)(ii), in the event that the Company terminates the Cooperation
Agreement pursuant to Section 8.4 of the Cooperation Agreement (a
"Competitive Transaction Termination") at any time prior to the expiration
of the Restricted Period, during the period beginning on the effective date
of such Competitive Transaction Termination and ending upon the expiration
of the Restricted Period, Purchaser, Parent and their Control Subsidiaries
may Transfer, in the aggregate, not more than that number of Shares per
year equal to 25% of the largest number of shares of Common Stock held by
Purchaser, Parent and their Control Subsidiaries, collectively, at any
point during the such period.
For purposes of this Agreement, a "Transfer" by Purchaser or Parent means any
transfer, sale, gift, assignment, pledge, encumbrance, conveyance or other
disposition by Purchaser or Parent to any person or entity (other than
Purchaser, Parent or a subsidiary of Parent); provided, however, that the term
"Transfer" shall not include Purchaser's, Parent's or a Control Subsidiary's
voting in favor of a merger transaction.
For purposes of this Agreement, "Restricted Period" shall mean the period
beginning on the date hereof and ending on the earliest to occur of (i) the
fourth anniversary of the date hereof, (ii) the termination of the Cooperation
Agreement (A) by the Company pursuant to Section 8.2 of the Cooperation
Agreement or (B) by Parent pursuant to Section 8.2 or 8.3 of the Cooperation
Agreement or (C) by mutual
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agreement of the Company and Parent or (iii) a Control Event (as defined below).
For purposes of this Agreement, "Control Event" shall mean the occurrence of any
of the following events: (i) a merger of the Company following which a majority
of the outstanding shares of Common Stock (or the outstanding capital stock of
the surviving corporation, if not the Company) immediately after the merger is
held by persons who (together with their affiliates), as of the date hereof, are
not holders of more than 5% of the outstanding shares of Common Stock as of the
date hereof (as reported in Schedules 13D and 13G with respect to the Common
Stock filed with the SEC prior to the date hereof) ("5% Holders"); (ii) a sale
of all or substantially all the assets of the Company; (iii) a change in a
majority of the members of the Board of Directors of the Company, except where
any such change occurs as a result of the election to the Board of Directors of
persons who were nominated by the incumbent Board of Directors; (iv) the
consummation of a tender, exchange or other offer by a third party and/or its
affiliates resulting in the acquisition by such third party and/or its
affiliates of at least 30% of the then outstanding shares of Common Stock of the
Company; (v) the acquisition of shares of Common Stock by a third party and/or
its affiliates who, as of the date hereof, are not 5% Holders resulting in such
third party and/or its affiliates holding 30% or more of the then outstanding
shares of Common Stock; (vi) the acquisition or tender offer by a competitor of
Purchaser or Parent in the enterprise resource planning (ERP) or supply chain
management market and/or its affiliates (collectively, a "Competitor") of or for
10% or more of the then outstanding shares of Common Stock; or (vii) the
dissolution or liquidation of the Company, the institution of any proceeding by
or against the Company under the provisions of any insolvency or bankruptcy law
which is not dismissed within 30 days, the appointment of a receiver of any of
the assets or property of the Company, or the issuance of an order for an
execution on a material portion of the property of the Company pursuant to a
judgment which is not dismissed within 30 days.
(b) Right of First Refusal. Unless the Restricted Period has previously
expired, Purchaser, Parent or a Control Subsidiary may propose to Transfer any
of the Shares (x) during the period beginning on the third anniversary of the
date hereof and ending upon the expiration of the Restricted Period, to the
extent permitted by Section 4.1(a)(ii), and (y) during the period beginning on
the effective date of a Competitive Transaction
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Termination and ending upon the expiration of the Restricted Period, to the
extent permitted by Section 4.1(a)(iv), in each case, only upon compliance with
the terms and conditions of this Section 4.1(b); provided, however, that this
Section 4.1(b) shall not apply to a Transfer of any Shares by Purchaser, Parent
or a Control Subsidiary made with the prior written approval of the Company, a
tender by Purchaser, Parent or a Control Subsidiary of any Shares permitted by
Section 4.1(a)(iii) or in connection with a merger of the Company.
(i) Purchaser or Parent, as the case may be, shall deliver to
the Company a written notice (an "Offer Notice") setting forth the
terms and conditions under which Purchaser, Parent or a Control
Subsidiary, as the case may be, would be willing to Transfer the
Shares, specifying the number of Shares Purchaser, Parent or a Control
Subsidiary, as the case may be, is willing to Transfer and the
consideration to be paid for such Shares. The Company shall have thirty
(30) days from the date of delivery of such Offer Notice to negotiate
with Purchaser or Parent, as the case may be, the Transfer of such
Shares or to reject Purchaser's or Parent's offer, as the case may be,
in writing (a "Rejection Notice"). Upon the earlier of the delivery of
a Rejection Notice by the Company and the expiration of such 30-day
period, if such Shares have not been purchased by the Company, for a
period of 180 days thereafter Purchaser, Parent or a Control
Subsidiary, as the case may be, shall have the right to offer or sell
the number of the Shares specified in the Offer Notice to a third party
for consideration that shall be not less than and on terms and
conditions that are no more favorable than the consideration and the
terms and conditions specified in the Offer Notice. In the event that
Purchaser, Parent or a Control Subsidiary, as the case may be, does not
Transfer such Shares to a third party within such 180-day period, the
Offer Notice shall expire and be of no further force or effect.
(ii) (A) In the event that during the 180-day period specified
in Section 4.1(b)(i) Purchaser, Parent or a Control Subsidiary, as the
case may be, receives and desires to accept a bona fide offer to
purchase the number of Shares specified in the Offer Notice for
consideration that is less than or on terms and conditions that are
more favorable than the consideration and the terms and conditions
specified in
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the Offer Notice, then Purchaser or Parent, as the case may be, shall
deliver a written notice of the proposed transfer (the "Transfer
Notice") to the Company, which notice shall describe the proposed
transaction and the terms thereof, including the name of each person to
whom or in favor of whom the proposed transfer shall be made (the
"Transferee"), the number of Shares proposed to be transferred and the
amount of consideration to be received upon transfer of such Shares and
such notice shall constitute an offer to sell the Shares in accordance
with the terms of this Section 4.1(b)(ii) to the Company, at a price
equal to 104% of the consideration specified in the Transfer Notice
(the "Company Consideration") and otherwise on the same terms and
conditions as those provided in the Transfer Notice. The Company shall
have thirty (30) days from the date of delivery of the Transfer Notice
to exercise its rights hereunder to accept the offer subject to terms
of this Section 4.1(b)(ii) by delivering within such 30-day period to
Purchaser or Parent, as the case may be, a written acceptance notice
stating that the Company is agreeing to purchase the number of Shares
specified in the Transfer Notice for the Company Consideration.
(B) In the event that the Company does not deliver such acceptance
notice within such 30-day period, Purchaser, Parent or the Control
Subsidiary, as the case may be, shall have the right to proceed with
the sale of the number of the Shares specified in the Transfer Notice
and make a bona fide Transfer of such Shares to the Transferee named in
the Transfer Notice, but only in strict accordance with the
consideration, terms and conditions stated in the Transfer Notice.
(C) The closing of any Transfer of Shares to the Company pursuant
to this Section 4.1(b)(ii) shall occur within forty-five (45) days
after the date of delivery of the Transfer Notice. If the Company does
not pay Purchaser, Parent or the Control Subsidiary, as the case may
be, the Company Consideration for the Shares within such 45-day period,
then Purchaser, Parent or the Control Subsidiary, as the case may be,
may Transfer such Shares to the Transferee in accordance with Section
4.1(b)(ii)(B).
(D) If, within sixty (60) days after the date on which Purchaser,
Parent or the Control Subsidiary, as the case may be, is free to make
the Transfer to the
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Transferee pursuant to Section 4.1(b)(ii)(B) or (C), a closing has not
occurred, the transfer restrictions in Section 4.1(b)(i) shall be
reinstated.
Notwithstanding the expiration of the Restricted Period by reason of an
acquisition by a Competitor described in clause (vi) of the definition
of "Control Event" through purchases of Common Stock in the open
market, this Section 4.1(b) shall apply until the earlier of (A) the
first anniversary of the expiration of the Restricted Period and (B)
the fourth anniversary of the date hereof, provided that such
Competitor has not acquired 20% or more of the then outstanding shares
of Common Stock and, within two business days of becoming aware of such
acquisition, the Board of Directors of the Company has taken
affirmative steps to discourage such acquisition by such Competitor and
provided further that no other Control Event has occurred or is
continuing.
(c) Right of First Negotiation. During the period beginning on the
expiration of the Restricted Period and ending upon the second
anniversary of such expiration, Purchaser, Parent or a Control
Subsidiary may propose to Transfer any of the Shares only upon
compliance with the terms and conditions of this Section 4.1(c);
provided, however, that this Section 4.1(c) shall not apply to (1) a
Transfer of any Shares by Purchaser, Parent or a Control Subsidiary
made with the prior written approval of the Company, (2) a Transfer or
Transfers of Shares in each of the two one-year periods within such
two-year period in an amount not to exceed, in the aggregate, 10% of
the largest number of shares of Common Stock held by Purchaser, Parent
and their Control Subsidiaries, collectively, at any point during such
one-year period, (3) a tender by Purchaser, Parent or a Control
Subsidiary of any Shares permitted by Section 4.1(a)(iii) or (4) in
connection with a merger of the Company.
(i) Purchaser or Parent, as the case may be, shall deliver to the
Company a written notice of the proposed Transfer, which notice shall
describe the number of Shares proposed to be Transferred. The Company
shall have thirty (30) days from the date of delivery of such notice
to exercise its rights hereunder to offer to purchase the number of
Shares specified in Purchaser's or Parent's notice, as the case may
be, by delivering within such 30-day period to Purchaser or Parent,
as the case may be, a written offer notice stating that the Company
is offering to
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purchase the number of Shares specified in Purchaser's or Parent's
notice, as the case may be, for the consideration set forth in such
offer notice.
(ii) During such 30-day period Purchaser or Parent, as the case
may be, shall negotiate with the Company for the Transfer of the
Shares specified in Purchaser's or Parent's notice; provided,
however, Purchaser or Parent, as the case may be, shall have no
obligation to accept any offer made by the Company.
(iii) Following the expiration of such 30-day period, Purchaser or
Parent, as the case may be, shall have the right to proceed with an
offer or sale of the number of Shares specified in Purchaser's or
Parent's notice, as the case may be, and to make a bona fide Transfer
of such Shares on such terms and conditions as Purchaser or Parent,
as the case may be, shall determine in its discretion.
(d) Limitations on Ownership of Common Stock.
(i) Subject to Section 4.1(d)(ii) and Section 4.1(d)(iii), during
the Restricted Period, Purchaser or Parent shall not, and shall not
permit any Control Subsidiary, directly or indirectly, to purchase or
otherwise acquire beneficial ownership of any shares of Common Stock,
any securities convertible or exchangeable for shares of Common
Stock, or any rights to acquire shares of Common Stock (except, in
any case, by way of stock dividends or other distributions or
offerings made available to holders of Common Stock generally or
pursuant to acquisitions of Common Stock permitted by Section 4.2(a))
or announce or make a tender, exchange or other offer for shares of
Common Stock, in each case, without the prior written approval of the
Company if such transaction would result in Purchaser, Parent and
their Control Subsidiaries together owning more than 9.7% of the
total number of shares of Common Stock then outstanding; provided,
however, that the limitations of this Section 4.1(d) shall not
prohibit Purchaser, Parent or a Control Subsidiary from acquiring the
stock of or other equity interests in any corporation, partnership or
other person which holds, directly or indirectly, any shares of
capital stock of the Company representing less than 10% of the total
assets of such corporation, partnership or person.
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(ii) Notwithstanding the foregoing, upon the occurrence of an
event (a "Threat Event") that Purchaser or Parent in good faith
reasonably believes could result in (A) a merger of the Company
following which a majority of the then outstanding shares of Common
Stock (or the outstanding capital stock of the surviving corporation,
if not the Company) immediately after the merger being held by
persons who (together with their affiliates), as of the date hereof,
are not 5% Holders; (B) a sale of all or substantially all the assets
of the Company, (C) a change in a majority of the members of the
Board of Directors of the Company, except where any such change
occurs as a result of the election to the Board of Directors of
persons who were nominated by the incumbent Board of Directors, (D) a
tender, exchange or other offer by a third party and/or its
affiliates for all or at least 20% of the outstanding shares of
Common Stock of the Company, (E) the acquisition of shares of Common
Stock by a third party and/or its affiliates who, as of the date
hereof, are not 5% Holders resulting in such third party and/or its
affiliates holding 20% or more of the then outstanding shares of
Common Stock or (F) the acquisition or tender offer by a Competitor
of or for 10% or more of the then outstanding shares of Common Stock,
upon delivery by Purchaser, Parent or any Control Subsidiary of
notice to the Company setting forth the reasons for such belief, the
restrictions of Section 4.1(d)(i) shall not apply to Purchaser,
Parent or any Control Subsidiary; provided, however, that if neither
Purchaser nor Parent has affirmatively commenced any action to
purchase or otherwise acquire additional shares of Common Stock or
has not announced or commenced a tender, exchange or other offer for
shares of Common Stock within the period commencing on the date of
delivery by Purchaser or Parent of the notice of a Threat Event and
ending on the earlier of (1) the definitive abandonment or the
completion of any of the transactions specified in the definition of
"Threat Event" or (2) 120 days thereafter, then the Company shall
have the right to reinstate the limitations of Section 4.1(d)(i) upon
30 days' prior written notice to Purchaser and Parent unless within
such 30-day period, Purchaser or Parent objects in writing to such
reinstatement.
(iii) Notwithstanding anything to the contrary contained in this
Agreement and subject to the provisions of Section 4.1(e) in the
event of a Major
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Competitor Transaction (as defined in the Cooperation Agreement),
upon delivery by Purchaser, Parent or a Control Subsidiary of a
notice of a Threat Event with respect to a transaction involving the
Company that the Company has notified Purchaser and Parent is to be
accounted for as a pooling of interests: (1) with a Competitor, then
the restrictions of Sections 4.1(a),(b), (c) and (d)(i) shall not
apply to Purchaser, Parent or any Control Subsidiary, provided that
any acquisition or purchase of additional shares of Common Stock by
Purchaser, Parent and/or their Control Subsidiaries would be pursuant
to a plan in which Purchaser, Parent and/or their Control
Subsidiaries would obtain control over at least 19% of the then
outstanding shares of Common Stock, and (2) with a person or entity
other than a Competitor, then (x) the restrictions of Section
4.1(d)(i) shall not apply to Purchaser, Parent or any Control
Subsidiary and (y) if Purchaser, Parent or their Control Subsidiaries
purchases or acquires additional shares of Common Stock (other than
pursuant to Section 4.2(a)), each of Purchaser, Parent and their
Control Subsidiaries will waive any appraisal rights it may have in
connection with such pooling of interests transaction, it being
understood that the provisions of the proviso to Section 4.1(d)(ii)
shall continue to apply in any event.
(e) Major Competitor Transaction. In the event of a Major
Competitor Transaction, (i) each of Purchaser, Parent and their Control
Subsidiaries will waive any appraisal rights it may have in connection with
any transaction thereafter entered into involving the Company that the
Company has notified Purchaser and Parent is to be accounted for as a
pooling of interests and the restrictions of Section 4.1(d)(iii) with
respect to the acquisition of additional shares of Common Stock by
Purchaser, Parent or any of their Control Subsidiaries shall not apply and
(ii) the rights of Parent and Purchaser to acquire additional shares of
Common Stock pursuant to Section 4.2(a) shall terminate.
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SECTION 4.2. Covenants of the Company.
(a) Preemptive Rights. Subject to the provisions of Section
4.1(e), except in connection with (i) the exercise by holders of options
granted under any of the Company's Stock Option Plans, (ii) the exercise of
the Warrant or (iii) a stock split or stock dividend with respect to the
Common Stock, the Company shall not issue or sell any shares of Common
Stock in an amount representing more than 30% of the then outstanding
shares of Common Stock during any 18-month period (including the issue or
sale of shares of Common Stock as all or a part of the consideration paid
by the Company in a merger, an acquisition of assets of a third party or an
acquisition of shares of a third party) unless prior to the issuance or
sale of such shares of Common Stock, Purchaser and Parent are notified in
writing of such sale and are given an opportunity to purchase, (i) if the
sale is for cash, on the same terms as such shares of Common Stock are
proposed to be sold or (ii) if the sale is for other consideration, at the
then current market price per share of the Common Stock, the same
proportion of the shares of Common Stock to be issued or offered for sale
by the Company as the number of shares of Common Stock held of record by
Purchaser, Parent or any Control Subsidiary, as the case may be, bears to
all of the issued and outstanding shares of Common Stock immediately prior
to such offer and sale. Purchaser and Parent shall have thirty (30) days to
exercise their rights under this Section 4.2(a).
(b) Registration Rights.
(i) Demand Registration. Following the expiration of the
Restricted Period and for so long as Purchaser, Parent and their Control
Subsidiaries together beneficially own at least 150,000 shares of Common
Stock (subject to adjustment in the event of a stock split or a stock
dividend on, or other recapitalization of, the Common Stock), in the event
that the Company shall receive a written notice from Purchaser or Parent
requesting that the Company effect a registration of all or a portion of
the Shares under the Securities Act, the Company shall, subject to the
terms hereof, prepare and file, within 45 days following delivery of such
notice, a registration statement covering the number of Shares specified in
the notice. The Company shall not be obligated to effect more than one
registration pursuant to this Section 4.2(b)(i); provided, however, that a
registration shall not be counted for this purpose if (A) the Company
elects to sell shares of its Common Stock pursuant to a registration at the
same time as
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the registration requested hereunder and less than all the Shares specified
in Purchaser's or Parent's request are included or (B) the registration
statement does not become effective or is withdrawn prior to the sale of
all the Shares specified in Purchaser's or Parent's request.
(ii) Piggy-back Registration. Following the expiration of the
Restricted Period, in the event that the Company proposes to register any
shares of Common Stock, under the Securities Act, on any registration form
(other than Form S-8), not less than sixty (60) days prior to effectiveness
of each such registration the Company shall give to Purchaser and Parent
written notice of such proposal which shall describe in detail the proposed
registration and distribution (including those jurisdictions where
registration or qualification under the securities or blue sky laws is
intended) and, upon the written request of Purchaser or Parent, as the case
may be, delivered within thirty (30) days after the date of any such notice
from the Company, proceed to include in such registration, such shares of
Common Stock as have been requested by Purchaser or Parent, as the case may
be, to be included in such registration. Purchaser or Parent, as the case
may be, shall in its request identify the number of shares of Common Stock
Purchaser or Parent, as the case may be, desires to register.
Notwithstanding anything contained herein, if the lead underwriter of an
underwritten offering involving a registration pursuant to this Section
4.2(b)(ii) delivers a written opinion to the Company that the success of
such offering would be materially and adversely affected by inclusion of
all the shares of Common Stock requested by Purchaser or Parent, as the
case may be, to be registered, then the number of shares of Common Stock of
each participant in the registration (including the Company) shall be
reduced in proportion to the number of shares of Common Stock originally
requested to be registered by each participant.
(iii) Registration. If Purchaser or Parent, as the case may be,
exercises its rights under either Section 4.2(b)(i) or (ii), the Company
shall use its reasonable best efforts to cause any and all shares of Common
Stock identified by Purchaser or Parent, as the case may be, to be
registered under the Securities Act and qualified under the securities or
blue sky laws of any jurisdiction requested by Purchaser or Parent, as the
case may be, to the extent necessary to permit the sale or other
disposition thereof; provided, however, that the Company shall not be
obligated to qualify as a foreign corporation to do business under the
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laws of any jurisdiction in which it is not then qualified. The Company
will pay and bear all expenses incident to each registration of Shares
contemplated by this Section 4.2(b); provided, however, that Purchaser or
Parent, as the case may be, will bear the fees and expenses of its own
counsel, accountants, investment bankers and advisors.
(iv) Listing. In connection with any registration of the Shares
pursuant to this Section 4.2(b), the Company shall promptly execute and
file with Nasdaq and any other exchange on which the Common Stock may be
traded an application or applications for the listing on the Nasdaq
National Market System and such other exchange of any Shares being
registered, file such other information and documents, enter into such
agreements with Nasdaq and such other exchange and take all such other
actions as may be required to effect such listing.
SECTION 4.3. Director Nominee.
(a) For so long as Purchaser, Parent and their Control
Subsidiaries together beneficially own at least 379,743 shares of Common
Stock (subject to adjustment in the event of a stock split or stock
dividend on, or other recapitalization of, the Common Stock), Purchaser and
Parent shall be entitled to (i) nominate one representative to the Board of
Directors of the Company, who shall serve as a Class III Director, subject
to the approval of the Company's Nominating Committee (which approval shall
not be unreasonably withheld), to serve in such capacity in accordance with
the Restated Certificate of Incorporation and the By-Laws of the Company or
(ii) be represented at meetings of the Board of Directors of the Company by
an observer during such times as there is no Purchaser nominee on the Board
of Directors.
(b) Notwithstanding the foregoing, Purchaser and Parent shall have
no obligation under this Agreement (i) to nominate a representative to the
Board of Directors, (ii) to have any such representative continue to serve
on the Board of Directors or (iii) to be represented at meetings of the
Board of Directors by an observer.
(c) If (i) the Cooperation Agreement is terminated by the Company
pursuant to Section 8.2 of the Cooperation Agreement and (ii) there is no
ongoing or unresolved dispute between Parent or Purchaser, on the one hand,
and the Company, on the other hand, with respect to the validity or
effectiveness of such termination of the Cooperation
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Agreement, then the rights provided to Purchaser and Parent in Section
4.3(a) shall terminate and Purchaser and Parent shall cause their nominee
to resign from the Board of Directors.
(d) In the event that Purchaser's or Parent's nominee is no longer
a senior executive of Purchaser or Parent or no longer has responsibilities
with Purchaser and Parent with respect to the commercial relationship
between the parties set forth in the Cooperation Agreement or the
Development Agreement, then Purchaser or Parent, as the case may be, shall
cause such nominee to resign from the Board of Directors and, if it desires
to fill such vacancy, shall name a person who is a senior executive of
Purchaser or Parent or who has responsibilities with Purchaser or Parent
with respect to the commercial relationship between the parties set forth
in the Cooperation Agreement or the Development Agreement, subject to the
approval of the Company's Nominating Committee (which approval shall not be
unreasonably withheld), to fill the vacancy created by such resignation.
Upon a request by the Company that Purchaser's or Parent's nominee be
removed from the Board of Directors without cause, Purchaser will give
reasonable consideration to such request but shall not be obligated to take
any action.
(e) In the event of a Major Competitor Transaction, the Company
may request in writing that Purchaser's or Parent's nominee pursuant to
this Section 4.3 be removed from the Board of Directors of the Company, and
Purchaser or Parent, as the case may be, shall cause such nominee to resign
from the Board of Directors of the Company.
SECTION 4.4. Public Announcements. Subject to applicable legal
requirements, each of Purchaser and the Company agrees that any press
release or other public announcement regarding the transactions
contemplated by this Agreement will be made only after consultation with
and the prior written approval of the other.
SECTION 4.5. Further Action. Subject to the terms and conditions
herein provided, each of the parties hereto agrees to use its reasonable
efforts to take promptly all actions and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws and regulations
to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement, including
using its reasonable efforts to obtain all necessary waivers, consents
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and approvals, effecting all necessary registrations and filings, and
defending any lawsuits or other proceedings, whether judicial or
administrative, challenging this Agreement or the consummation of any of
the transactions contemplated hereby, including seeking to have any stay or
temporary restraining order entered by any court or other Governmental
Entity vacated or reversed. In connection with and without limiting the
foregoing, the Company and the Board of Directors of the Company shall (i)
take all action necessary to ensure that no state takeover statute or
similar statute or regulation is or becomes applicable to this Agreement or
any of the transactions contemplated hereby and (ii) if any state takeover
statute or similar statute or regulation becomes applicable to this
Agreement or any of the transactions contemplated hereby, take all action
necessary to ensure that the transactions contemplated by this Agreement
may be consummated as promptly as practicable on the terms contemplated by
this Agreement and otherwise to minimize the effect of such statute or
regulation on this Agreement and the transactions contemplated hereby.
ARTICLE V
SURVIVAL
SECTION 5.1. Survival. The representations and warranties in this
Agreement or in any instrument or certificate delivered pursuant to this
Agreement shall survive the date hereof until 45 days following the date on
which the Company's annual report on Form 10-K for the year ended December
31, 1999 is filed with the SEC; provided, however, that the representations
and warranties (a) of the Company in Sections 2.1, 2.2, 2.3, 2.8, and 2.12
of this Agreement and (b) of Purchaser and Parent in Sections 3.1, 3.2, 3.3
and 3.4 shall survive the date hereof, without limitation.
ARTICLE VI
ASSIGNMENT; PARTIES IN INTEREST; AMENDMENT; WAIVER
SECTION 6.1. Assignment. The parties to this Agreement shall not
convey, assign or otherwise transfer any of their rights or obligations
under this Agreement without the express written consent of Purchaser and
Parent or the Company, as the case may be, except that Purchaser may
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assign its rights, interests or obligations to any direct or indirect
Control Subsidiary of Parent or Purchaser. Any such conveyance, assignment
or transfer without the express written consent of the other party shall be
void ab initio. No assignment of this Agreement shall relieve the assigning
party of its obligations hereunder.
SECTION 6.2. Parties in Interest. This Agreement is binding upon
and is for the benefit of the parties hereto and their respective
successors and permitted assigns. This Agreement is not made for the
benefit of any person, firm, corporation or other entity not a party
hereto, and no person, firm, corporation or other entity other than the
parties hereto or their respective successors and permitted assigns shall
acquire or have any right, remedy or claim under or by virtue of this
Agreement.
SECTION 6.3. Amendment. This Agreement cannot be amended or
modified except by a written agreement executed by the parties hereto.
SECTION 6.4. Waiver. Purchaser may extend the time for the
performance of or waive compliance with any of the obligations or other
acts of the Company contained herein or waive any inaccuracies in the
representations and warranties of the Company contained herein or in any
document delivered pursuant hereto, and the Company may extend the time for
the performance of or waive compliance with any of the obligations or other
acts of Purchaser contained herein or waive any inaccuracies in the
representations and warranties of Purchaser contained herein or in any
document delivered pursuant hereto. Any such extension or waiver shall be
valid only if set forth in an instrument in writing signed by the party to
be bound thereby. The failure of any party to this Agreement to assert any
of its rights under this Agreement or otherwise shall not constitute a
waiver of those rights.
ARTICLE VII
GENERAL PROVISIONS
SECTION 7.1. Effect of Investigation. All representations,
warranties, covenants and agreements made by the Company in this Agreement
or in any certificates, statements or other instruments delivered pursuant
to this Agreement shall be unaffected by any investigation made by or on
behalf of Purchaser or Parent or knowledge obtained as
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a result thereof or otherwise. All representations, warranties, covenants
and agreements made by Purchaser or Parent in this Agreement or in any
certificates, statements or other instruments delivered pursuant to this
Agreement shall be unaffected by any investigation made by or on behalf of
the Company or knowledge obtained as a result thereof or otherwise.
SECTION 7.2. Fees and Expenses. Each of the parties hereto agrees
to pay, without right of reimbursement from the other, the costs incurred
by it incident to the performance of its obligations hereunder, including,
without limitation, the fees and disbursements of counsel, accountants,
financial advisors, experts and consultants employed by the respective
parties in connection with the transactions contemplated hereby.
SECTION 7.3. Notices. Any notice, request, instruction or other
communication to be given hereunder by either party to the other shall be
in writing and shall be deemed to have been duly given (i) on the date of
delivery if delivered personally, or by telecopy or telefacsimile, upon
confirmation of receipt, (ii) on the first business day following the date
of dispatch if delivered by Federal Express or other nationally reputable
next-day courier service, or (iii) on the third business day following the
date of mailing if delivered by registered or certified mail, return
receipt requested, postage prepaid. All notices hereunder shall be
delivered as set forth below, or pursuant to such other instructions as may
be designated in writing by the party to receive such notice.
(a) If to Purchaser or Parent:
SAP America, Inc.
Legal Department
3999 West Chester Pike
Newtown Square, Pennsylvania 19073
Attention: General Counsel
Facsimile: (610) 661-4016
and
SAP Aktiengesellschaft
Neurottstrasse 16
D-69190 Walldorf, Germany
Attention: Legal Department
Facsimile: 49-6227-7-42060
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with a copy to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112
Attention: Morton E. Grosz, Esq.
Facsimile: (212) 541-5369
(b) If to the Company:
Catalyst International, Inc.
8989 North Deerwood Drive
Milwaukee, Wisconsin 53223
Attention: General Counsel
Facsimile: (414) 365-2145
with a copy to:
Godfrey & Kahn, S.C.
780 North Water Street
Milwaukee, Wisconsin 53202
Attention: Mark T. Ehrmann, Esq.
Facsimile: 414-273-5198
SECTION 7.4. Brokers; Fee Schedule. The Company represents and
warrants that there are no claims (or any basis for any claims) for
brokerage commissions, finder's fees or like payments in connection with
this Agreement or the transactions contemplated hereby resulting from any
action taken by or on behalf of the Company, except for fees payable by the
Company to Broadview International LLC and Brean Murray. Purchaser and
Parent represent and warrant that there are no claims (or any basis for any
claims) for brokerage commissions, finder's fees or like payments in
connection with this Agreement or the transactions contemplated hereby or
thereby resulting from any action taken by or on behalf of it, except for
fees payable by Purchaser or Parent to Goldman Sachs Group Inc.
SECTION 7.5. Captions, Currency. The Article, Section and
paragraph captions herein are for convenience of reference only, do not
constitute part of this Agreement and shall not be deemed to limit or
otherwise affect any of the provisions hereof. Unless otherwise specified,
all references contained in this Agreement or in any instrument or document
delivered pursuant hereto to dollars shall mean United States Dollars.
Unless otherwise specified, all references herein to numbered sections and
articles are to sections and articles of this Agreement.
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SECTION 7.6. Entire Agreement. This Agreement, the Cooperation
Agreement and the Development Agreement together constitute the entire
agreement among the parties with respect to the subject matter hereof and
this Agreement, the Cooperation Agreement and the Development Agreement
supersede all prior agreements or understandings of the parties relating
thereto.
SECTION 7.7. Specific Performance. In the event of any actual or
threatened default in, or breach of, any of the terms, conditions and
provisions of this Agreement, the party who is or is to be thereby
aggrieved shall have the right to seek specific performance and injunctive
relief giving effect to its rights under this Agreement, in addition to any
and all other rights and remedies at law or in equity, and all such rights
and remedies shall be cumulative. The parties agree that the remedies at
law for any breach or threatened breach, including monetary damages, are
inadequate compensation for any loss and that any defense in any action for
specific performance that a remedy at law would be adequate is waived.
SECTION 7.8. Severability. If any provision of this Agreement or
the application thereof to any person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions thereof, or the application of such provision to
persons or circumstances other than those as to which it has been held
invalid or unenforceable, shall remain in full force and effect and shall
in no way be affected, impaired or invalidated thereby, so long as the
economic or legal substance of the transactions contemplated thereby is not
affected in any manner adverse to any party. Upon any such determination,
the parties shall negotiate in good faith in an effort to agree upon a
suitable and equitable substitute provision to effect the original intent
of the parties.
SECTION 7.9. Governing Law. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and to be performed entirely within such
State, without regard to the conflicts of law principles of such State.
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SECTION 7.10. Counterparts. For the convenience of the parties,
this Agreement may be executed in any number of separate counterparts, each
such counterpart being deemed to be an original instrument, and all such
counterparts shall together constitute the same agreement. Receipt of
facsimile copies of signature pages hereof shall constitute delivery of
such signature pages if followed up within two business days with executed
original signature pages.
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IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto on the date
first hereinabove written.
SAP AMERICA, INC.
By: /s/ Kevin S. McKay
Name: Kevin S. McKay
Title:President and CEO
SAP AKTIENGESELLSCHAFT
By: /s/ Henning Kagermann
Name:Henning Kagermann
Title: Co-Chairman,
Executive Board
By: /s/ Hasso Plattner
Name: Hasso Plattner
Title: Co-Chairman,
Executive Board
CATALYST INTERNATIONAL, INC.
By: /s/ Sean P. McGowan
Name: Sean P. McGowan
Title: President & CEO
33
