SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
SCHEDULE 14D-1
Tender Offer Statement
Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
(Amendment No. 1)
and
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No. 1)
________________________
MICOM Communications Corp.
(Name of Subject Company)
________________________
Northern Telecom Limited
Northern Telecom Inc.
Elder Corporation
(Bidders)
________________________
Common Stock, Par Value $.0000001 Per Share
(Title of Class of Securities)
________________________
59478P 10 3
(CUSIP Number of Class of Securities)
________________________
Peter J. Chilibeck
Corporate Secretary and Assistant Secretary
Northern Telecom Limited
2920 Matheson Boulevard East
Mississauga, Ontario
Canada L4W 4M7
(Name, address and Telephone Number of Persons Authorized to
Receive Notices and Communications on Behalf of Bidders)
________________________
With a copy to:
Victor I. Lewkow, Esq.
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, New York 10006
(212) 225-2000
<PAGE>
INTRODUCTION
Elder Corporation, a Delaware corporation ("Purchaser"),
Northern Telecom Inc., a Delaware corporation ("Parent"), and
Northern Telecom Limited, a corporation organized under the laws of
Canada ("Nortel"), hereby amend their joint Tender Offer Statement
on Schedule 14D-1 dated May 17, 1996 relating to a tender offer to
purchase all outstanding shares of Common Stock, par value
$.0000001 per share (the "Shares"), of MICOM Communications Corp.,
a Delaware corporation, at $12.00 per Share, net to the seller in
cash, (such Tender Offer Statement on Schedule 14D-1, the "Schedule
14D-1"). All terms defined in the Schedule 14D-1 have the same
meanings in this Amendment.
Item 7. Contracts, Arrangements, Understandings or
Relationships with Respect to the Subject Company's
Securities.
The following paragraphs are hereby inserted after the
first paragraph:
Parent and Purchaser have entered into letter agreements
dated May 30, 1996 (the "Yost Letter Agreement" and the "Odyssey Letter
Agreement", respectively) with E.R. Yost ("Yost") and with Odyssey
Partners, L.P. ("Odyssey"), Odyssey Investors, Inc. and certain
partners and former partners of Odyssey (the "Distributee
Partners"), pursuant to which Yost is effectively assigning 42,000
Shares to a charitable institution subject to the same terms as the
existing Stock Option Agreement filed as Exhibit (c)(3) hereto, and
Odyssey is effectively assigning up to an aggregate of 767,000
Shares to the Distributee Partners, subject to the same terms as
the existing Stock Option Agreement filed as Exhibit (c)(2) hereto,
who are in turn in effect assigning such Shares to certain
charitable institutions subject to the same terms as the existing
Stock Option Agreement filed as Exhibit (c)(2) hereto. In connection
therewith, Yost and the Odyssey Partners are required to indemnify
Parent and Sub under certain circumstances.
The Odyssey Letter Agreement and the Yost Letter Agreement,
with exhibits, are attached as Exhibit Nos. (c)(5) and (c)(6) and
are incorporated herein by reference, and the foregoing summary is
qualified in its entirety by reference to each such Letter Agreement
and its exhibits.
<PAGE>
SIGNATURES
After due inquiry and to the best of its knowledge and
belief, each of the undersigned certifies that the information set
forth in this statement is true, complete and correct.
NORTHERN TELECOM LIMITED
By: /s/ WILLIAM R. KERR
-------------------------------
Name: William R. Kerr
Title: Vice-President and Treasurer
By: /s/ DEBORAH J. NOBLE
-------------------------------
Name: Deborah J. Noble
Title: Assistant Secretary
NORTHERN TELECOM INC.
By: /s/ PETER W. CURRIE
-------------------------------
Name: Peter W. Currie
Title: Attorney-in-Fact
ELDER CORPORATION
By: /s/ ANTHONY J. LAFLEUR
-------------------------------
Name: Anthony J. Lafleur
Title: Vice-President and Assistant
Secretary
Dated: June 4, 1996
<PAGE>
EXHIBIT INDEX
The following items (c)(5) and (c)(6) are hereby added
to the Exhibit Index:
Exhibit
No. Description
(c)(5) Odyssey Letter Agreement
(c)(6) Yost Letter Agreement
Odyssey Partners, L.P.
Odyssey Investors, Inc.
31 West 52 Street
New York, N.Y. 10019
May 30, 1996
Northern Telecom Inc.
Elder Corporation
c/o Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Ladies and Gentlemen:
We refer to that certain Stock Option Agreement, dated
as of May 13, 1996 (the "Agreement"), among Northern Telecom
Inc., a Delaware corporation ("Parent"), Elder Corporation, a
Delaware corporation ("Sub"), Odyssey Partners, L.P., a Delaware
limited partnership (the "Stockholder"), and Odyssey Investors,
Inc., a Delaware corporation. Capitalized terms not otherwise
defined herein have the meanings assigned to them in the
Agreement.
Pursuant to the Agreement, the Stockholder has agreed,
among other things, subject to the conditions set forth therein,
to validly tender pursuant to the Offer (and not to withdraw) all
of the Existing Shares beneficially owned by the Stockholder and
has also granted Parent and Sub the Stock Option with respect to
the Existing Shares.
Stockholder wishes to distribute certain of the
Existing Shares to certain of its partners and former partners
who, in turn, wish to make charitable gifts of such Existing
Shares so received, and Parent and Sub hereby agree to the same,
with such Existing Shares remaining effectively subject to the
terms of the Agreement (including the Stock Option).
Accordingly, this is to confirm that, notwithstanding anything to
the contrary in the Agreement:
1. The Stockholder may, as soon as practicable
following the execution and delivery of this
letter, distribute in kind to the partners and
former partners of the Stockholder identified as
such on Schedule I hereto (each such partner being
referred to herein as a "distributee partner") up
to an aggregate of 767,000 shares of Common Stock,
provided that, concurrently with such
distribution, each distributee partner shall
execute and deliver to Parent and Sub a stock
option agreement in the form of Exhibit A hereto
(the "Distributee Partner Stock Option
Agreement"), whereafter the Stockholder shall be
fully and unconditionally released from any and
all obligations required to be performed by the
Stockholder under the Agreement with respect to
any and all shares of such Common Stock so
distributed, but not any other Option Shares. The
Stockholder represents and warrants to Parent and
to Sub that the distribution by the Stockholder of
any such shares of Common Stock to a distributee
partner, when effected, shall pass to and
unconditionally vest in such distributee partner
good and valid title to the shares so distributed,
free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and
encumbrances whatsoever (other than those in favor
of Parent and Sub under the Agreement or under
this letter).
2. Each distributee partner may, as soon as
practicable following the in-kind distributions
referred to in paragraph (1) above (and in no
event later than June 6, 1996), make a charitable
gift to one or more of the five charitable
institutions listed on Schedule I hereto (each, a
"charity") of the shares of Common Stock
distributed to him in kind as provided in
paragraph (1) above, provided that, (a)
concurrently with each such gift, the distributee
partner shall execute and deliver to Parent and
Sub an Indemnity Agreement in the form of Exhibit
B hereto and (b) prior to making such gift, the
recipient charity shall have executed and
delivered to Parent and Sub a stock option
agreement in the form of Exhibit C hereto, it
being understood that such execution and delivery
is a condition to making such gift.
3. The second sentence of Section 5(e) of the
Agreement is hereby amended to delete the words
"to Parent".
4. Parent and Sub hereby agree that, notwithstanding
the letter dated May 23, 1996 from Parent and Sub
to the Stockholder, the Stockholder shall not be
obligated to tender the Existing Shares pursuant
to the Offer prior to the close of business on
June 4, 1996.
5. Except as expressly modified by this letter, the
Agreement shall remain in full force and effect.
Please confirm your agreement to the foregoing by
signing this letter where indicated below.
Very truly yours,
ODYSSEY PARTNERS, L.P.
By: /s/
------------------------
Jack Nash
General Partner
ODYSSEY INVESTORS, INC.
By: /s/
------------------------
Stephen Berger
Vice President
ACCEPTED AND AGREED:
- -------------------
NORTHERN TELECOM INC.
By: /s/
--------------------------------
Peter Currie
Attorney-in-fact
ELDER CORPORATION
By: /s/
--------------------------------
William R. Kerr
Vice President and Treasurer
<PAGE>
DISTRIBUTEE PARTNERS
- --------------------
/s/
- -----------------------------------
Leon Levy
/s/
- -----------------------------------
Jack Nash
/s/
- -----------------------------------
Joshua Nash
/s/
- -----------------------------------
Martin J. Rabinowitz
/s/
- -----------------------------------
Brian Young
/s/
- -----------------------------------
Steven Friedman
<PAGE>
SCHEDULE I
----------
Distributee Partners
--------------------
Leon Levy
Jack Nash
Joshua Nash
Martin J. Rabinowitz
Brian Young
Steven Friedman
Charities
---------
Bard College
Metropolitan Museum of Art
University of Chicago
Harvard & Co.
The Jewish Communal Fund
<PAGE>
Exhibit A
FORM OF
ODYSSEY DISTRIBUTEE
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT dated as of ______________, by
and among Northern Telecom Inc., a Delaware corporation
("Parent"), Elder Corporation, a Delaware corporation and a
wholly owned subsidiary of Parent ("Sub"), and _____________ (the
"Stockholder").
W I T N E S S E T H:
WHEREAS, Parent, Sub and MICOM Communications Corp., a
Delaware corporation (the "Company"), entered into an Agreement
and Plan of Merger dated as of May 13, 1996 (as such agreement
may hereafter be amended from time to time, the "Merger
Agreement"; capitalized terms used and not defined herein having
the respective meanings given to them in the Merger Agreement),
pursuant to which Sub will be merged with and into the Company
(the "Merger");
WHEREAS, concurrently with the execution and delivery
of the Merger Agreement and as an inducement and a condition to
Parent and Sub entering into the Merger Agreement, Parent, Sub,
Odyssey Partners, L.P., a Delaware limited partnership
("Odyssey"), and an affiliate of Odyssey entered into a Stock
Option Agreement dated as of May 13, 1996 (the "Odyssey Option
Agreement");
WHEREAS, in furtherance of the Merger and pursuant to
the Merger Agreement, on May 17, 1996, Sub commenced a cash
tender offer pursuant to which Sub has offered to purchase all
outstanding shares of Company Common Stock (as defined in Section
1), including all of the Option Shares (as defined in Section 2),
upon the terms and conditions set forth in the Merger Agreement
and the offering documents for the Offer;
WHEREAS, the Odyssey Option Agreement requires, among
other things, that Odyssey validly tender (and not withdraw)
4,737,733 shares held by it (the "Shares") of the Company Common
Stock, pursuant to and in accordance with the Offer;
WHEREAS, in connection with the Odyssey Option
Agreement and concurrently herewith, pursuant to a letter dated
May 30, 1996 from Odyssey to each of Parent and Sub (the "Letter
Agreement") (i) Odyssey is distributing to the Stockholder
___________ of the Shares, which constitute all of the Option
Shares hereunder, and the Stockholder is entering into this
Agreement with respect to the Option Shares and (ii) promptly
after the execution and delivery of this Agreement, (a) the
Stockholder is making a charitable gift to ________________ (the
"Charitable Institution") of the Option Shares and, as a
condition precedent to making such gift, the Charitable
Institution is entering into a stock option agreement with
respect to the Option Shares with Parent and Sub in the form of
Exhibit B to the Letter Agreement (the "Charitable Institution
Option Agreement"), and (b) the Stockholder is entering into an
indemnity agreement with respect to the Option Shares with Parent
and Sub in the form of Exhibit C to the Letter Agreement (the
"Indemnity Agreement"); and
WHEREAS, as an inducement and a condition to Parent and
Sub entering into the Letter Agreement and as a condition to
Odyssey's making the distribution to the Stockholder, Parent and
Sub have required that the Stockholder agree, and the Stockholder
has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual
premises, representations, warranties, covenants and agreements
contained herein, the parties hereto, intending to be legally
bound, hereby agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Acquisition Transaction" shall mean any merger,
consolidation, liquidation, dissolution, recapitalization,
reorganization or other business combination, acquisition or sale
or other disposition of a material amount of assets or
securities, tender offer or exchange offer or any other similar
transaction involving the Company, its securities or any of its
material subsidiaries or divisions.
(b) "beneficially own" or "beneficial ownership" with
respect to any securities shall mean having "beneficial
ownership" of such securities (as determined pursuant to Rule
13d-3 under the Securities Act of 1934, as amended (the "Exchange
Act")), including pursuant to any agreement, arrangement or
understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities
beneficially owned by a Person shall include securities
beneficially owned by all other Persons with whom such Person
would constitute a "group" as within the meaning of Section
13(d)(3) of the Exchange Act.
(c) "Company Common Stock" shall mean at any time the
common stock, $0.0000001 par value, of the Company.
(d) "Person" shall mean any individual, corporation,
partnership, limited liability company, joint venture, firm,
association, trust, unincorporated organization or other entity.
2. Tender of Option Shares. To induce Parent and Sub
to enter into the Letter Agreement and subject to terms and
conditions set forth herein:
(a) Stockholder hereby agrees to validly tender (and
not to withdraw) pursuant to and in accordance with the terms of
the Offer, promptly (but not later than June 7, 1996), for
acceptance by Sub in the Offer, the number of shares of Company
Common Stock set forth opposite the Stockholder's name on
Schedule I hereto (together with any additional shares of Company
Common Stock or other Company securities received as dividends
thereon or received as a result of any stock split,
reclassification or similar transaction relating to such shares,
the "Option Shares"), beneficially owned by it; provided that, if
the purchase price per share of Company Common Stock of the Offer
is for any reason increased to an amount greater than the
Purchase Price (as defined in Section 4), then (i) the
Stockholder will not tender the Option Shares into the Offer
after the first public announcement of such increase, and (ii) if
any Option Shares were tendered into the Offer prior to such
first public announcement, the Stockholder will promptly withdraw
its tender of such Option Shares. In the event that the
Stockholder is not permitted to tender (or is required to
withdraw) the Option Shares pursuant to the proviso to the
immediately preceding sentence, Sub shall be obligated to, and
will, exercise the Stock Option on the first business day
following the purchase of any shares of Company Common Stock
pursuant to the Offer, in which case (notwithstanding the notice
period set forth in Section 4(b)), no notice need be given to the
Stockholder, and the closing of the purchase of the Option Shares
(the "Closing") shall also take place on the first business day
following the purchase of Shares pursuant to the Offer, at 11:00
A.M. (New York time) at Cleary, Gottlieb, Steen & Hamilton, One
Liberty Plaza, New York, NY, or at such other time and place as
the parties shall agree. The Stockholder hereby acknowledges and
agrees that Sub's obligation to accept for payment and pay for
Company Common Stock in the Offer, including the Option Shares,
is subject to the terms and conditions of the Offer.
(b) The Stockholder hereby agrees to permit Parent and
Sub to publish and disclose in the Offer Documents and, if
approval of the stockholders of the Company is required under
applicable law, the Proxy Statement (including all documents and
schedules filed with the Securities and Exchange Commission) its
identify and ownership of Company Common Stock and the nature of
its commitments, arrangements and understandings under this
Agreement.
3. Provisions Concerning Company Common Stock. The
Stockholder hereby agrees that during the period commencing on
the date hereof and continuing until the first to occur of (i)
the Effective Time and (ii) the termination of this Agreement as
set forth in Section 8, at any meeting of the holders of Company
Common Stock, however called, or in connection with any written
consent of the holders of Company Common Stock, the Stockholder
shall vote (or cause to be voted) the Option Shares held of
record or beneficially owned by the Stockholder whether issued,
heretofore owned or hereafter acquired, (i) in favor of the
approval and adoption of the agreement of merger (as such term is
used in Section 251 of the Delaware General Corporation Law)
contained in the Merger Agreement, (ii) in favor of any other
action related to the Merger or in furtherance of the
transactions contemplated by the Merger Agreement and this
Agreement, (iii) against any action or agreement that would
result in a breach in any respect of any covenant, representation
or warranty or any other obligation or agreement of the Company
under the Merger Agreement or this Agreement, and (iv) except as
otherwise agreed to in writing in advance by Sub, against the
following actions (other than the Merger and the transactions
contemplated by the Merger Agreement): (x) any Acquisition
Transaction; and (y) (1) any change in a majority of the persons
who constitute the Board of Directors of the Company; (2) any
change in the present capitalization of the Company or any
amendment of Company's Certificate of Incorporation or By-laws;
(3) any other material change in the Company's corporate
structure or business; and (4) any other action involving the
Company or its subsidiaries which is intended, or could
reasonably be expected, to impede, interfere with, delay,
postpone, or otherwise adversely affect the Offer, the Merger and
the transactions contemplated by this Agreement and the Merger
Agreement. The Stockholder shall not enter into any agreement or
understanding with any Person the effect of which would be
inconsistent with or violative of the provisions and agreements
contained in this Section 3.
4. Option.
(a) To induce Parent and Sub to enter into the Letter
Agreement and subject to the terms and conditions set forth
herein, the Stockholder hereby grants to Sub an irrevocable
option (the "Stock Option") to purchase the Option Shares at a
purchase price per share of $12.00 (the "Purchase Price"). If
(i) the Offer is terminated, abandoned or withdrawn by Parent or
Sub (whether due to the failure of any of the conditions thereto
or otherwise), (ii) the Offer is consummated but Sub has not
accepted for payment and paid for the Option Shares (whether due
to the proviso to the first sentence of Section 2 or otherwise)
or (iii) the Merger Agreement is terminated in accordance with
its terms (other than for the failure of Parent or Sub to fulfill
any material obligation under the Merger Agreement or by mutual
agreement of the parties thereto), the Stock Option shall, in any
such case, become exercisable, in whole but not in part, upon the
first to occur of any such event and remain exercisable, in whole
but not in part, until the date which is 60 days after the date
of the occurrence of such event, so long as: (x) all waiting
periods under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), required for the purchase of
the Stock Option upon such exercise shall have expired or been
waived, and (y) there shall not then be in effect any preliminary
or final injunction or other order issued by any court or
governmental, administrative or regulatory agency or authority
prohibiting the exercise of the Stock Option pursuant to this
Agreement. In the event that the Stock Option is not exercisable
because the circumstances described in clauses (x) and (y) do not
exist, then the Stock Option shall be exercisable for a period
not exceeding an additional 30 days after the 60-day period
referred to in the immediately preceding sentence.
(b) In the event that Sub wishes to exercise the Stock
Option, and subject to Section 2(a), Sub shall send a written
notice to the Stockholder identifying the place and time for the
Closing at least there business days, and not more than five
business days, prior to the Closing. Subject to the terms and
conditions of this Agreement, in reliance on the representations,
warranties and covenants of the Stockholder contained herein and
in full payment for the Option Shares, Sub will deliver at the
Closing to the Stockholder, by wire transfer of immediately
available funds to an account designated by the Stockholder at
lease one business day in advance, an aggregate amount equal to
the product of (x) the Purchase Price and (y) the number of
Option Shares. At the Closing, the Stockholder will deliver, or
cause to be delivered, to Sub certificates representing the
Option Shares duly endorsed to Sub or accompanied by stock powers
duly executed by the Stockholder in blank, together with any
necessary stock transfer stamps properly affixed.
(c) Acquired Option Shares. In the event the Option
Shares are acquired by Sub pursuant to the exercise of the Option
("Acquired Option Shares"), the Stockholder shall be entitled to
receive, upon any subsequent disposition, transfer or sale (other
than to an affiliate who takes such Acquired Option Shares
subject to Sub's obligations under this Section) ("Sale") of the
Acquired Option Shares for which a binding contract of sale is
entered into within 180 days of the Closing, an amount in cash
equal to 50% of the excess (if any) of the aggregate proceeds
received in the Sale (net of selling commissions, if any) over
the aggregate Purchase Price for the Acquired Option Shares
subject to such Sale. If any of the consideration received by
Sub in such Sale consists of securities, for purposes hereof the
proceeds of such Sale shall be deemed to be the net amount that
would actually have been received in an orderly sale of such
securities commencing on the first business day following actual
receipt of such securities by Sub, in the written opinion of an
investment banking firm of national reputation selected by Sub
and reasonably satisfactory to Odyssey. Any payment due
hereunder shall be paid by Sub to the Stockholder within five
days after receipt of the Sale proceeds or, if any of the
consideration consists of securities, after the receipt of such
investment banking firm's written opinion to the parties.
Nothing herein shall create any duty by Sub to engage in a Sale
of the Acquired Option Shares.
5. Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to Parent and Sub
as follows:
(a) Ownership of Option Shares. The Stockholder is
the record and beneficial owner of the number of Option Shares
set forth opposite the Stockholder's name on Schedule I hereto.
The Stockholder has sole voting power and sole power to issue
instructions with respect to the matters set forth in Sections 2,
3 and 4 hereof, sole power of disposition, sole power of
conversion, sole power to demand appraisal rights and sole power
to agree to all of the matters set forth in this Agreement, in
each case with respect to all of the Option Shares, with no
limitations, qualifications or restrictions on such rights,
subject to applicable securities laws and the terms of this
Agreement, and subject to the Letter Agreement and the Indemnity
Agreement (when executed and delivered by the parties thereto).
(b) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and perform all
of the Stockholder's obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which the
Stockholder is a party including, without limitation, any voting
agreement, stockholders' agreement or voting trust. This
Agreement has been duly and validly executed and delivered by the
Stockholder and constitutes a valid and binding agreement of the
Stockholder, enforceable against the Stockholder in accordance
with its terms. There is no beneficiary or holder of a voting
trust certificate or other interest of any trust of which the
Stockholder is trustee whose consent is required for the
execution and delivery of this Agreement or the consummation by
the Stockholder of the transactions contemplated hereby. The
Stockholder hereby revokes any and all proxies with respect to
any of the Option Shares.
(c) No Conflicts. Except for filings and approvals
under the HSR Act or the Exchange Act, if applicable, (x) no
filing with, and no permit, authorization, consent or approval
of, any state or federal public body or authority or any Person
is necessary for the execution of this Agreement by the
Stockholder and the consummation by the Stockholder of the
transactions contemplated hereby and (y) none of the execution
and delivery of this Agreement by the Stockholder, the
consummation by the Stockholder of the transactions contemplated
hereby or compliance by the Stockholder with any of the
provisions hereof shall (1) result in a violation or breach of,
or constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination,
cancellation, modification or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any
kind to which the Stockholder is a party or by which the
Stockholder or any of the Stockholder's properties or assets may
be bound, or (2) violate any order, writ, injunction, decree,
judgment, order, statute, rule or regulation applicable to the
Stockholder or any of the Stockholder's properties or assets.
(d) No Finder's Fees. No broker, investment banker,
financial advisor or other Person is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission
in connection with the transactions contemplated hereby based
upon arrangements made by or on behalf of the Stockholder.
(e) No Encumbrances. The Option Shares and the
certificates representing such Option Shares are now, and at all
times during the term hereof will be, held by the Stockholder, or
by a nominee or custodian for the benefit of the Stockholder,
free and clear of all liens, claims, options, charges, security
interests, proxies, voting trusts or agreements, understandings
or arrangements or any other legal or equitable rights or
encumbrances whatsoever, except for any such encumbrances or
proxies arising hereunder and except under the Letter Agreement
and the Indemnity Agreement (when executed and delivered by the
parties thereto). The gift by the Stockholder of the Option
Shares to the Charitable Institution as described in the fifth
recital hereto shall pass to and unconditionally vest in the
Charitable Institution good and valid title to all the Option
Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances
whatsoever (other than in favor of Parent and Sub under this
Agreement and under the Indemnity Agreement and Charitable
Institution Option Agreement, each when executed and delivered by
the parties thereto). The transfer, if any, by the Stockholder
of the Option Shares to Sub in the Offer or hereunder (after
payment in full of the purchase price thereof) shall pass to and
unconditionally vest in Sub good and valid title to all Option
Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances
whatsoever (other than those in favor of Parent and Sub under
this Agreement and under the Indemnity Agreement, when executed
and delivered by the parties thereto).
(f) Reliance by Parent. The Stockholder understands
and acknowledges that Parent is entering into, and causing Sub to
enter into, the Letter Agreement in reliance upon the
Stockholder's execution, delivery and performance of this
Agreement and the Indemnity Agreement.
6. Additional Covenants of the Stockholder. In
addition to the covenants and agreements included elsewhere
herein, the Stockholder covenants and agrees as follows:
(a) No Solicitation. The Stockholder (and Persons
acting on behalf of the Stockholder) shall not directly or
indirectly, initiate, solicit (including by way of furnishing
information), encourage or respond to or take any other action
knowingly to facilitate, any inquiries or the making of any
proposal by any Person (other than Parent or any affiliate of
Parent) with respect to, an Acquisition Transaction (an
"Acquisition Proposal"), or enter into or maintain or continue
discussions or negotiate with any Person (other than Parent or
any affiliate of Parent) in furtherance of such inquiries or to
obtain any Acquisition Proposal, or agree to or endorse any
Acquisition Proposal, or authorize or permit any Person acting on
behalf of the Stockholder to do any of the foregoing. The
Stockholder will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any Person
conducted heretofore with respect to any of the foregoing. If
the Stockholder receives any inquiry or proposal regarding any
acquisition Proposal, the Stockholder shall promptly inform Sub
of that inquiry or proposal, the details thereof, the identify of
the Person making such inquiry or proposal and shall in the case
of written proposals or inquiries, furnish Sub with a copy of
such proposal or inquiry (and all amendments and supplements
thereto).
(b) Restriction on Transfer, Proxies and Non-
Interference. Except as contemplated by this Agreement or the
Letter Agreement, the Stockholder shall not directly or
indirectly, (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any
contract, option or other arrangement or understanding with
respect to, or consent to the offer for sale, transfer, tender,
pledge, encumbrance, assignment or other disposition of, any or
all of the Option Shares or any interest therein; (ii) grant any
proxies or powers of attorney, deposit any Option Shares into a
voting trust or enter into a voting agreement with respect to any
Option Shares; or (iii) take any action that would make any
representation or warranty of the Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling
the Stockholder from performing the Stockholder's obligations
under this Agreement.
(c) Waiver of Appraisal Rights. The Stockholder
hereby irrevocably waives any rights of appraisal or rights to
dissent from the Merger that the Stockholder may have.
(d) Stop Transfer; Changes in Option Shares. Except
as contemplated by the Letter Agreement, the Stockholder agrees
with, and covenants to, Parent and Sub that the Stockholder shall
not request that the Company register the transfer (book-entry or
otherwise) of any certificate or uncertificated interest
representing any of the Option Shares, unless such transfer is
made in compliance with this Agreement. In the event of a stock
dividend, split-up, merger, recapitalization, combination,
conversion exchange of shares or the like (in each case with a
record date prior to the termination of this Agreement), (i) the
term "Option Shares" shall be deemed to refer to and include the
Option Shares as well as all such stock dividends and
distributions and any securities into which or for which any or
all of the Option Shares may be changed or exchanged and such
dividends, distributions and securities, as the case may be,
shall be paid to Sub at the Closing or promptly following the
receipt of such dividend or distribution, if the Closing
theretofore shall have occurred and (ii) the number and kind of
shares subject to this Agreement and Purchase Price shall be
appropriately adjusted to reflect changes made in the Company
Common Stock so that Sub shall receive, upon exercise of the
Stock Option and payment of the Purchase Price, the number and
class of shares, other securities, property or cash that Sub
would have received in respect of the Option Shares if the Stock
Option had been exercised and the Option Shares had been issued
to Sub immediately prior to such event or the record date
therefor, as applicable.
7. Termination. This Agreement (other than Section
4(c) if, and to the extent applicable) shall terminate, and no
party shall have any rights or obligations hereunder and this
Agreement shall become null and void and have no effect from and
after the last date on which the Stock Option is exercisable
pursuant to Section 4.
8. Miscellaneous.
(a) Further Assurances. From time to time, at the
other party's request and without further consideration, each
party hereto shall execute and deliver such additional documents
and take all such further lawful action as may be necessary or
appropriate to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by
this Agreement.
(b) Entire Agreement; No Third Party Beneficiaries.
This Agreement, the Letter Agreement and the Indemnity Agreement
(when executed and delivered by the parties thereto) constitute
the entire agreement among the parties with respect to the
subject matter hereof and supersede all other prior agreements
and understandings, written or oral, among the parties with
respect to the subject matter hereof. This Agreement is not
intended for the benefit of or intended to confer upon any Person
other than the parties hereto any rights or remedies hereunder.
(c) Certain Events. The Stockholder agrees that this
Agreement and the obligations hereunder shall attach to the
Option Shares and shall be binding upon any Person to which legal
or beneficial ownership of such Option Shares shall pass, whether
by operation of law or otherwise, including, without limitation,
the Stockholder's heirs, guardians, administrators or successors.
Notwithstanding any transfer of Option Shares, the transferor
shall remain liable for the performance of all obligations under
this Agreement of the transferor.
(d) Assignment. This Agreement shall not be assigned
by operation of law or otherwise without the prior written
consent of the other parties provided that Parent and Sub may
assign, in their sole discretion, their rights and obligations
hereunder to any direct or indirect wholly-owned subsidiary of
Parent, although no such assignment shall relieve Parent or Sub
of their obligations hereunder if such assignee does not perform
such obligations.
(e) Amendments, Waivers, Etc. This Agreement may not
be amended, changed, supplemented, waived or otherwise modified
or terminated, except upon the execution and delivery of a
written agreement executed by the relevant parties hereto;
provided that Schedule I hereto may be supplemented by Parent and
Sub by adding the name and other relevant information concerning
any stockholder of the Company who agrees to be bound by the
terms of this Agreement without the agreement of any other party
hereto, and thereafter such added stockholder shall be treated as
a "Stockholder" for all purposes of this Agreement.
(f) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the Stockholder: ____________________________
____________________________
____________________________
____________________________
Facsimile: ________________
Attention:
If to Parent or Sub: c/o Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3082
Attention: Mr. William R. Kerr
Vice President and Treasurer
copy to: Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3457
Attention: Anthony J. Lafleur, Esq.
Vice President and Associate
General Counsel
and to: Cleary, Gottlieb, Steen & Hamilton
1 Liberty Plaza
New York, New York 10006
Facsimile: 212-225-3999
Attention: Victor I. Lewkow, Esq.
or to such other address as the Person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(g) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
(h) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(i) Remedies Cumulative. All rights, powers and
remedies provided under this Agreement or otherwise available in
respect hereof at law or in equity shall be cumulative and not
alternative, and the exercise of any thereof by any party shall
not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(j) No Waiver. The failure of any party hereto to
exercise any right, power or remedy provided under this Agreement
or otherwise available in respect hereof at law or in equity, or
to insist upon compliance by any other party hereto with its
obligations hereunder, and any custom or practice of the parties
at variance with the terms hereof shall not constitute a waiver
by such party of its right to exercise any such or other right,
power or remedy or to demand such compliance.
(k) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, without giving effect to the principles of conflicts of
law thereof.
(l) Jurisdiction. Each party hereby irrevocably
submits to the exclusive jurisdiction of the Court of Chancery in
the State of Delaware or the United States District Court for the
Southern District of New York or any court of the State of New
York located in the City of New York in any action, suit or
proceeding arising in connection with this Agreement, and agrees
that any such action, suit or proceeding shall be brought only in
such court (and waives any objection based on forum non
conveniens or any other objection to venue therein); provided,
however, that such consent to jurisdiction is solely for the
purpose referred to in this paragraph (l) and shall not be deemed
to be a general submission to the jurisdiction of said Courts or
in the States of Delaware or New York other than for such
purposes. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN CONNECTION WITH ANY SUCH ACTION, SUIT OR PROCEEDING.
(m) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(n) Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original,
but all of which, taken together, shall constitute one and the
same Agreement.
<PAGE>
IN WITNESS WHEREOF, Parent, Sub and the Stockholder
have caused this Agreement to be duly executed as of the day and
year first above written.
NORTHERN TELECOM INC.
By:_________________________________
Name: Peter Currie
Title: Attorney-in-fact
ELDER CORPORATION
By:______________________________
Name: William R. Kerr
Title: Vice President and
Treasurer
____________________________________
Stockholder:
<PAGE>
SCHEDULE I TO
STOCK OPTION AGREEMENT
Name of Stockholder Number of Option Shares Owned
___________________ _________________
<PAGE>
Exhibit B
FORM OF
INDEMNITY AGREEMENT
INDEMNITY AGREEMENT dated as of __________, 1996 by and
among Northern Telecom Inc., a Delaware corporation ("Parent"),
Elder Corporation, a Delaware corporation and a wholly owned
subsidiary of Parent ("Sub"), and _____________ (the
"Indemnitor").
W I T N E S S E T H:
WHEREAS, Parent, Sub, Odyssey Partners, L.P., a
Delaware limited partnership ("Odyssey"), and an affiliate of
Odyssey entered into a Stock Option Agreement dated as of May 13,
1996 (the "Odyssey Option Agreement");
WHEREAS, the Odyssey Option Agreement requires, among
other things, that Odyssey validly tender (and not withdraw)
4,737,733 shares held by it (the "Shares") of the common stock,
$.0000001 par value per share (the "Company Common Stock"), of
MICOM Communications Corp., a Delaware corporation (the
"Company"), pursuant to and in accordance with the Offer (as
defined in the Odyssey Option Agreement);
WHEREAS, in connection with the Odyssey Option
Agreement, pursuant to a letter dated May 30, 1996 from Odyssey
to each of Parent and Sub (the "Letter Agreement") (i) Odyssey
has distributed to the Indemnitor ___________ of the Shares
(together with any additional shares of Company Common Stock or
other Company securities received as dividends thereon or
received as a result of any stock split, reclassification or
similar transaction relating to such shares, the "Distributed
Shares") and the Indemnitor has entered into a stock option
agreement with respect to such Distributed Shares with Parent and
Sub in the form of Exhibit A to the Letter Agreement (the
"Indemnitor Option Agreement") and (ii) the Indemnitor is making
a charitable gift to ________________ (the "Charitable
Institution") of all of the Distributed Shares and, as a
condition precedent to making such gift, the Charitable
Institution is entering into a stock option agreement with
respect to such Shares with Parent and Sub in the form of Exhibit
B to the Letter Agreement (the "Charitable Institution Option
Agreement"); and
WHEREAS, to induce Parent and Sub to enter into the
Letter Agreement, the Indemnitor agreed pursuant to the Letter
Agreement to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual
premises, covenants and agreements contained herein, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. Indemnity.
(a) The Indemnitor shall indemnify and reimburse each
of Parent and Sub for (i) any payment (including in connection
with the exercise of any appraisal rights under applicable law)
by Sub or the Surviving Corporation (as defined in the Merger
Agreement dated as of May 13, 1996 among Parent, Sub and the
Company) to the Charitable Institution (or its successors,
permitted assigns or any purchaser from the Charitable
Institution of the Distributed Shares) pursuant to the Offer or,
if applicable, the Merger (as defined in the Charitable
Institution Agreement), of any amount for the Distributed Shares
in excess of the aggregate amount (such aggregate amount, the
"Purchase Price") otherwise payable by Sub to the Charitable
Institution for the Distributed Shares pursuant to the
penultimate sentence of Section 2(a) of the Charitable
Institution Option Agreement (excluding from such excess any
amount required to be paid to the Charitable Institution pursuant
to Section 4(c) of the Charitable Institution Option Agreement);
(ii) an amount equal to 50% of the excess (if any) of (a) the
aggregate proceeds (net of selling commissions, if any) received
by the Charitable Institution in any sale or other disposition by
the Charitable Institution of the Distributed Shares to a third
party in breach of the Charitable Institution Option Agreement
over (b) the Purchase Price for the Distributed Shares subject to
such sale, provided that such amount otherwise shall not have
been paid over by the Charitable Institution to Parent or Sub (or
any of their respective affiliates), and provided further that if
any of the proceeds of such sale received by the Charitable
Institution shall consist of securities, for purposes hereof, the
proceeds of such sale shall be deemed to be the net amount that
would actually have been received in an orderly sale of such
securities commencing on the first business day following actual
receipt of such securities by the Charitable Institution, in the
written opinion of an investment banking firm of national
reputation selected by Sub and reasonably satisfactory to the
Indemnitor and delivered by such investment bank to each of them;
and (iii) any and all reasonable out-of-pocket expenses actually
incurred by Parent or Sub in enforcing this Agreement against the
Indemnitor.
(b) Any claim for indemnification shall be made by
written notice addressed to the Indemnitor, c/o Odyssey Partners,
L.P., 31 West 52nd Street, New York, New York 10019, Fax: 212-
708-0750 (with a copy to Weil, Gotshal & Manges, 767 Fifth
Avenue, New York, NY 10153, attention: Simeon Gold, Esq., Fax:
212-310-8007), setting forth, in reasonable detail, the basis for
such claim. With respect to any claim for payment under clauses
(i) and (ii) of Section 1(a), the Indemnitor shall be required to
remit such payment within 10 days after receipt of such notice,
by certified or bank cashier's check payable to the order of
Parent or Sub as directed in such notice, provided that in the
case of clause (ii), if any of the proceeds of the sale referred
to therein shall consist of securities, the Indemnitor shall not
be required to remit such payment until after the receipt of the
investment banking firm's written opinion to each of the
Indemnitor and Sub as described in such clause (ii). With
respect to any claim for payment under clause (iii) of Section 1
(a), the Indemnitor shall be required to remit such payment in
the same manner as provided for in the immediately preceding
sentence promptly after a final determination of the amounts due
with respect to such claim for payment.
2. Release. Except as expressly contemplated in this
Agreement, each of Parent and Sub shall fully and unconditionally
release the Indemnitor from any and all obligations to be
performed by the Indemnitor under the Indemnitor Option Agreement
with respect to the Distributed Shares (and the Indemnitor hereby
relinquishes any and all rights thereunder relating to such
Distributed Shares, including any rights to payment under Section
4(c) thereof) from and after the making of the charitable gift of
the Distributed Shares by the Indemnitor to the Charitable
Institution, except that the Indemnitor's obligations under
Section 3 of the Indemnitor Option Agreement, if any, and the
Indemnitor's representations and warranties under Section 5(e) of
the Indemnitor Option Agreement shall survive such release in
accordance with the respective terms applicable thereto. Except
as expressly modified by this Agreement, the Indemnitor Option
Agreement shall remain in full force and effect.
3. Representations and Warranties. The Indemnitor
hereby represents and warrants to each of Parent and Sub that:
(a) The Indemnitor has the legal capacity, power and
authority to enter into and perform all of the Indemnitor's
obligations under this Agreement.
(b) The execution, delivery and performance of this
Agreement by the Indemnitor will not violate or cause a breach of
or a default under (or give rise to any third party right of
termination, cancellation, modification or acceleration) any
other agreement to which the Indemnitor is a party or violate any
writ, order, decree or judgment binding on the Indemnitor.
(c) No consent or other approval of any third party is
necessary for the execution, delivery and performance of this
Agreement by the Indemnitor.
4. Incorporation by Reference. The provisions
contained in Sections 9(d) (Assignment), (f) (Notices), (g)
(Severability), (h) (Specific Performance), (i) (Remedies
Cumulative), (j) (No Waiver), (k) (Governing Law), (l)
(Jurisdiction), (m) (Descriptive Headings) and (n) (Counterparts)
of the Indemnitor Option Agreement are hereby incorporated by
reference herein as if set forth in full herein.
5. Amendments; Waivers. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or
terminated, except upon the execution and delivery of a written
agreement executed by the parties hereto; provided that any
waiver need only be executed and delivered in writing by the
party against whom the waiver is to be enforced.
6. Entire Agreement; No Third Party Beneficiaries.
This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, written or oral,
between the parties with respect to the subject matter hereof.
This Agreement is not intended for the benefit of or intended to
confer upon any person other that the parties hereto any rights
or remedies hereunder.
<PAGE>
IN WITNESS WHEREOF, Parent, Sub and the Indemnitor have
caused this Agreement to be duly executed as of the day and year
first written above.
NORTHERN TELECOM INC.
By:_________________________________
Name: Peter Currie
Title: Attorney-in-fact
ELDER CORPORATION
By:_________________________________
Name: William R. Kerr
Title: Vice President and
Treasurer
____________________________________
Indemnitor:
<PAGE>
Exhibit C
FORM OF
CHARITABLE INSTITUTION
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT dated as of ______________, 1996
by and among Northern Telecom Inc., a Delaware corporation
("Parent"), Elder Corporation, a Delaware corporation and a
wholly owned subsidiary of Parent ("Sub"), and _____________ (the
"Stockholder").
W I T N E S S E T H:
WHEREAS, Parent, Sub and MICOM Communications Corp., a
Delaware corporation (the "Company"), entered into an Agreement
and Plan of Merger dated as of May 13, 1996 (as such agreement
may hereafter be amended from time to time, the "Merger
Agreement"; capitalized terms used and not defined herein having
the respective meanings given to them in the Merger Agreement),
pursuant to which Sub will be merged with and into the Company
(the "Merger");
WHEREAS, concurrently with the execution and delivery
of the Merger Agreement and as an inducement and a condition to
Parent and Sub entering into the Merger Agreement, Parent, Sub,
Odyssey Partners, L.P., a Delaware limited partnership
("Odyssey"), and an affiliate of Odyssey entered into a Stock
Option Agreement dated as of May 13, 1996 (the "Odyssey Option
Agreement");
WHEREAS, in furtherance of the Merger and pursuant to
the Merger Agreement, on May 17, 1996, Sub commenced a cash
tender offer pursuant to which Sub has offered to purchase all
outstanding shares of Company Common Stock (as defined in Section
1), including all of the Option Shares (as defined in Section 2),
upon the terms and conditions set forth in the Merger Agreement
and the offering documents for the Offer;
WHEREAS, the Odyssey Option Agreement requires, among
other things, that Odyssey validly tender (and not withdraw)
4,737,733 shares held by it (the "Shares") of the Company Common
Stock, pursuant to and in accordance with the Offer;
WHEREAS, in connection with the Odyssey Option
Agreement, pursuant to a letter dated May 30, 1996 from Odyssey
to each of Parent and Sub (the "Letter Agreement") (i) Odyssey
has distributed to ___________ (the "Odyssey Distributee")
______________ of the Shares, which constitute all of the Option
Shares hereunder, and the Odyssey Distributee has entered into a
stock option agreement with respect to the Option Shares with
Parent and Sub in the form of Exhibit A to the Letter Agreement
and (ii) (a) the Odyssey Distributee is making a charitable gift
to the Stockholder of the Option Shares and, as a condition
precedent to making such gift, the Stockholder is entering into
this Agreement with respect to the Option Shares, and (b) the
Odyssey Distributee is entering into an indemnity agreement with
respect to the Option Shares with Parent and Sub in the form of
Exhibit B to the Letter Agreement; and
WHEREAS, as an inducement and a condition to Parent and
Sub entering into the Letter Agreement, and as a condition to the
Odyssey Distributee's making of the charitable gift of the Option
Shares to the Stockholder, Parent and Sub have required that the
Stockholder agree, and the Stockholder has agreed, to enter into
this Agreement.
NOW, THEREFORE, in consideration of the mutual
premises, representations, warranties, covenants and agreements
contained herein, the parties hereto, intending to be legally
bound, hereby agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Acquisition Transaction" shall mean any merger,
consolidation, liquidation, dissolution, recapitalization,
reorganization or other business combination, acquisition or sale
or other disposition of a material amount of assets or
securities, tender offer or exchange offer or any other similar
transaction involving the Company, its securities or any of its
material subsidiaries or divisions.
(b) "beneficially own" or "beneficial ownership" with
respect to any securities shall mean having "beneficial
ownership" of such securities (as determined pursuant to Rule
13d-3 under the Securities Act of 1934, as amended (the "Exchange
Act")), including pursuant to any agreement, arrangement or
understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities
beneficially owned by a Person shall include securities
beneficially owned by all other Persons with whom such Person
would constitute a "group" as within the meaning of Section
13(d)(3) of the Exchange Act.
(c) "Company Common Stock" shall mean at any time the
common stock, $0.0000001 par value, of the Company.
(d) "Person" shall mean any individual, corporation,
partnership, limited liability company, joint venture, firm,
association, trust, unincorporated organization or other entity.
2. Tender of Option Shares. To induce Parent and Sub
to enter into the Letter Agreement and subject to terms and
conditions set forth herein:
(a) Stockholder hereby agrees to validly tender (and
not to withdraw) pursuant to and in accordance with the terms of
the Offer, promptly (but not later than June 7, 1996), for
acceptance by Sub in the Offer, the number of shares of Company
Common Stock set forth opposite the Stockholder's name on
Schedule I hereto (together with any additional shares of Company
Common Stock or other Company securities received as dividends
thereon or received as a result of any stock split,
reclassification or similar transaction relating to such shares,
the "Option Shares"), beneficially owned by it; provided that, if
the purchase price per share of Company Common Stock of the Offer
is for any reason increased to an amount greater than the
Purchase Price (as defined in Section 4), then (i) the
Stockholder will not tender the Option Shares into the Offer
after the first public announcement of such increase, and (ii) if
any Option Shares were tendered into the Offer prior to such
first public announcement, the Stockholder will promptly withdraw
its tender of such Option Shares. In the event that the
Stockholder is not permitted to tender (or is required to
withdraw) the Option Shares pursuant to the proviso to the
immediately preceding sentence, Sub shall be obligated to, and
will, exercise the Stock Option on the first business day
following the purchase of any shares of Company Common Stock
pursuant to the Offer, in which case (notwithstanding the notice
period set forth in Section 4(b)), no notice need be given to the
Stockholder, and the closing of the purchase of the Option Shares
(the "Closing") shall also take place on the first business day
following the purchase of Shares pursuant to the Offer, at 11:00
A.M. (New York time) at Cleary, Gottlieb, Steen & Hamilton, One
Liberty Plaza, New York, NY, or at such other time and place as
the parties shall agree. The Stockholder hereby acknowledges and
agrees that Sub's obligation to accept for payment and pay for
Company Common Stock in the Offer, including the Option Shares,
is subject to the terms and conditions of the Offer.
(b) The Stockholder hereby agrees to permit Parent and
Sub to publish and disclose in the Offer Documents and, if
approval of the stockholders of the Company is required under
applicable law, the Proxy Statement (including all documents and
schedules filed with the Securities and Exchange Commission) its
identify and ownership of Company Common Stock and the nature of
its commitments, arrangements and understandings under this
Agreement.
3. Provisions Concerning Company Common Stock. The
Stockholder hereby agrees that during the period commencing on
the date hereof and continuing until the first to occur of (i)
the Effective Time and (ii) the termination of this Agreement as
set forth in Section 8, at any meeting of the holders of Company
Common Stock, however called, or in connection with any written
consent of the holders of Company Common Stock, the Stockholder
shall vote (or cause to be voted) the Option Shares held of
record or beneficially owned by the Stockholder whether issued,
heretofore owned or hereafter acquired, (i) in favor of the
approval and adoption of the agreement of merger (as such term is
used in Section 251 of the Delaware General Corporation Law)
contained in the Merger Agreement, (ii) in favor of any other
action related to the Merger or in furtherance of the
transactions contemplated by the Merger Agreement and this
Agreement, (iii) against any action or agreement that would
result in a breach in any respect of any covenant, representation
or warranty or any other obligation or agreement of the Company
under the Merger Agreement or this Agreement, and (iv) except as
otherwise agreed to in writing in advance by Sub, against the
following actions (other than the Merger and the transactions
contemplated by the Merger Agreement): (x) any Acquisition
Transaction; and (y) (1) any change in a majority of the persons
who constitute the Board of Directors of the Company; (2) any
change in the present capitalization of the Company or any
amendment of Company's Certificate of Incorporation or By-laws;
(3) any other material change in the Company's corporate
structure or business; and (4) any other action involving the
Company or its subsidiaries which is intended, or could
reasonably be expected, to impede, interfere with, delay,
postpone, or otherwise adversely affect the Offer, the Merger and
the transactions contemplated by this Agreement and the Merger
Agreement. The Stockholder shall not enter into any agreement or
understanding with any Person the effect of which would be
inconsistent with or violative of the provisions and agreements
contained in this Section 3.
4. Option.
(a) To induce Parent and Sub to enter into the Letter
Agreement and subject to the terms and conditions set forth
herein, the Stockholder hereby grants to Sub an irrevocable
option (the "Stock Option") to purchase the Option Shares at a
purchase price per share of $12.00 (the "Purchase Price"). If
(i) the Offer is terminated, abandoned or withdrawn by Parent or
Sub (whether due to the failure of any of the conditions thereto
or otherwise), (ii) the Offer is consummated but Sub has not
accepted for payment and paid for the Option Shares (whether due
to the proviso to the first sentence of Section 2 or otherwise)
or (iii) the Merger Agreement is terminated in accordance with
its terms (other than for the failure of Parent or Sub to fulfill
any material obligation under the Merger Agreement or by mutual
agreement of the parties thereto), the Stock Option shall, in any
such case, become exercisable, in whole but not in part, upon the
first to occur of any such event and remain exercisable, in whole
but not in part, until the date which is 60 days after the date
of the occurrence of such event, so long as: (x) all waiting
periods under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), required for the purchase of
the Stock Option upon such exercise shall have expired or been
waived, and (y) there shall not then be in effect any preliminary
or final injunction or other order issued by any court or
governmental, administrative or regulatory agency or authority
prohibiting the exercise of the Stock Option pursuant to this
Agreement. In the event that the Stock Option is not exercisable
because the circumstances described in clauses (x) and (y) do not
exist, then the Stock Option shall be exercisable for a period
not exceeding an additional 30 days after the 60-day period
referred to in the immediately preceding sentence.
(b) In the event that Sub wishes to exercise the Stock
Option, and subject to Section 2(a), Sub shall send a written
notice to the Stockholder identifying the place and time for the
Closing at least there business days, and not more than five
business days, prior to the Closing. Subject to the terms and
conditions of this Agreement, in reliance on the representations,
warranties and covenants of the Stockholder contained herein and
in full payment for the Option Shares, Sub will deliver at the
Closing to the Stockholder, by wire transfer of immediately
available funds to an account designated by the Stockholder at
lease one business day in advance, an aggregate amount equal to
the product of (x) the Purchase Price and (y) the number of
Option Shares. At the Closing, the Stockholder will deliver, or
cause to be delivered, to Sub certificates representing the
Option Shares duly endorsed to Sub or accompanied by stock powers
duly executed by the Stockholder in blank, together with any
necessary stock transfer stamps properly affixed.
(c) Acquired Option Shares. In the event the Option
Shares are acquired by Sub pursuant to the exercise of the Option
("Acquired Option Shares"), the Stockholder shall be entitled to
receive, upon any subsequent disposition, transfer or sale (other
than to an affiliate who takes such Acquired Option Shares
subject to Sub's obligations under this Section) ("Sale") of the
Acquired Option Shares for which a binding contract of sale is
entered into within 180 days of the Closing, an amount in cash
equal to 50% of the excess (if any) of the aggregate proceeds
received in the Sale (net of selling commissions, if any) over
the aggregate Purchase Price for the Acquired Option Shares
subject to such Sale. If any of the consideration received by
Sub in such Sale consists of securities, for purposes hereof the
proceeds of such Sale shall be deemed to be the net amount that
would actually have been received in an orderly sale of such
securities commencing on the first business day following actual
receipt of such securities by Sub, in the written opinion of an
investment banking firm of national reputation selected by Sub
and reasonably satisfactory to the Stockholder. Any payment due
hereunder shall be paid by Sub to the Stockholder within five
days after receipt of the Sale proceeds or, if any of the
consideration consists of securities, after the receipt of such
investment banking firm's written opinion to the parties.
Nothing herein shall create any duty by Sub to engage in a Sale
of the Acquired Option Shares.
5. Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to Parent and Sub
as follows:
(a) Ownership of Option Shares. The Stockholder is
the record and beneficial owner of the number of Option Shares
set forth opposite the Stockholder's name on Schedule I hereto.
The Stockholder has sole voting power and sole power to issue
instructions with respect to the matters set forth in Sections 2,
3 and 4 hereof, sole power of disposition, sole power of
conversion, sole power to demand appraisal rights and sole power
to agree to all of the matters set forth in this Agreement, in
each case with respect to all of the Option Shares, with no
limitations, qualifications or restrictions on such rights,
subject to applicable securities laws and the terms of this
Agreement.
(b) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and perform all
of the Stockholder's obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which the
Stockholder is a party including, without limitation, any voting
agreement, stockholders' agreement or voting trust. This
Agreement has been duly and validly executed and delivered by the
Stockholder and constitutes a valid and binding agreement of the
Stockholder, enforceable against the Stockholder in accordance
with its terms. There is no beneficiary or holder of a voting
trust certificate or other interest of any trust of which the
Stockholder is trustee whose consent is required for the
execution and delivery of this Agreement or the consummation by
the Stockholder of the transactions contemplated hereby. The
Stockholder hereby revokes any and all proxies with respect to
any of the Option Shares.
(c) No Conflicts. Except for filings and approvals
under the HSR Act or the Exchange Act, if applicable, (x) no
filing with, and no permit, authorization, consent or approval
of, any state or federal public body or authority or any Person
is necessary for the execution of this Agreement by the
Stockholder and the consummation by the Stockholder of the
transactions contemplated hereby and (y) none of the execution
and delivery of this Agreement by the Stockholder, the
consummation by the Stockholder of the transactions contemplated
hereby or compliance by the Stockholder with any of the
provisions hereof shall (1) result in a violation or breach of,
or constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination,
cancellation, modification or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any
kind to which the Stockholder is a party or by which the
Stockholder or any of the Stockholder's properties or assets may
be bound, or (2) violate any order, writ, injunction, decree,
judgment, order, statute, rule or regulation applicable to the
Stockholder or any of the Stockholder's properties or assets.
(d) No Finder's Fees. No broker, investment banker,
financial advisor or other Person is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission
in connection with the transactions contemplated hereby based
upon arrangements made by or on behalf of the Stockholder.
(e) No Encumbrances. The Option Shares and the
certificates representing such Option Shares are now, and at all
times during the term hereof will be, held by the Stockholder, or
by a nominee or custodian for the benefit of the Stockholder,
free and clear of all liens, claims, options, charges, security
interests, proxies, voting trusts or agreements, understandings
or arrangements or any other legal or equitable rights or
encumbrances whatsoever, except for any such encumbrances or
proxies arising hereunder. The transfer by the Stockholder of
the Option Shares to Sub in the Offer or hereunder (after payment
in full of the purchase price thereof) shall pass to and
unconditionally vest in Sub good and valid title to all Option
Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances
whatsoever (other than those in favor of Parent and Sub).
6. Additional Covenants of the Stockholder. In
addition to the covenants and agreements included elsewhere
herein, the Stockholder covenants and agrees as follows:
(a) No Solicitation. The Stockholder (and Persons
acting on behalf of the Stockholder) shall not directly or
indirectly, initiate, solicit (including by way of furnishing
information), encourage or respond to or take any other action
knowingly to facilitate, any inquiries or the making of any
proposal by any Person (other than Parent or any affiliate of
Parent) with respect to, an Acquisition Transaction (an
"Acquisition Proposal"), or enter into or maintain or continue
discussions or negotiate with any Person (other than Parent or
any affiliate of Parent) in furtherance of such inquiries or to
obtain any Acquisition Proposal, or agree to or endorse any
Acquisition Proposal, or authorize or permit any Person acting on
behalf of the Stockholder to do any of the foregoing. The
Stockholder will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any Person
conducted heretofore with respect to any of the foregoing. If
the Stockholder receives any inquiry or proposal regarding any
acquisition Proposal, the Stockholder shall promptly inform Sub
of that inquiry or proposal, the details thereof, the identify of
the Person making such inquiry or proposal and shall in the case
of written proposals or inquiries, furnish Sub with a copy of
such proposal or inquiry (and all amendments and supplements
thereto).
(b) Restriction on Transfer, Proxies and Non-
Interference. Except as contemplated by this Agreement, the
Stockholder shall not directly or indirectly, (i) offer for sale,
sell, transfer, tender, pledge, encumber, assign or otherwise
dispose of, or enter into any contract, option or other
arrangement or understanding with respect to, or consent to the
offer for sale, transfer, tender, pledge, encumbrance, assignment
or other disposition of, any or all of the Option Shares or any
interest therein; (ii) grant any proxies or powers of attorney,
deposit any Option Shares into a voting trust or enter into a
voting agreement with respect to any Option Shares; or (iii) take
any action that would make any representation or warranty of the
Stockholder contained herein untrue or incorrect or have the
effect of preventing or disabling the Stockholder from performing
the Stockholder's obligations under this Agreement.
(c) Waiver of Appraisal Rights. The Stockholder
hereby irrevocably waives any rights of appraisal or rights to
dissent from the Merger that the Stockholder may have.
(d) Stop Transfer; Changes in Option Shares. The
Stockholder agrees with, and covenants to, Parent and Sub that
the Stockholder shall not request that the Company register the
transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Option Shares,
unless such transfer is made in compliance with this Agreement.
In the event of a stock dividend, split-up, merger,
recapitalization, combination, conversion exchange of shares or
the like (in each case with a record date prior to the
termination of this Agreement), (i) the term "Option Shares"
shall be deemed to refer to and include the Option Shares as well
as all such stock dividends and distributions and any securities
into which or for which any or all of the Option Shares may be
changed or exchanged and such dividends, distributions and
securities, as the case may be, shall be paid to Sub at the
Closing or promptly following the receipt of such dividend or
distribution, if the Closing theretofor shall have occurred and
(ii) the number and kind of shares subject to this Agreement and
Purchase Price shall be appropriately adjusted to reflect changes
made in the Company Common Stock so that Sub shall receive, upon
exercise of the Stock Option and payment of the Purchase Price,
the number and class of shares, other securities, property or
cash that Sub would have received in respect of the Option Shares
if the Stock Option had been exercised and the Option Shares had
been issued to Sub immediately prior to such event or the record
date therefor, as applicable.
7. Termination. This Agreement (other than Section
4(c) if, and to the extent applicable) shall terminate, and no
party shall have any rights or obligations hereunder and this
Agreement shall become null and void and have no effect from and
after the last date on which the Stock Option is exercisable
pursuant to Section 4.
8. Miscellaneous.
(a) Further Assurances. From time to time, at the
other party's request and without further consideration, each
party hereto shall execute and deliver such additional documents
and take all such further lawful action as may be necessary or
appropriate to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by
this Agreement.
(b) Entire Agreement; No Third Party Beneficiaries.
This Agreement constitutes the entire agreement among the parties
with respect to the subject matter hereof and supersedes all
other prior agreements and understandings, written or oral, among
the parties with respect to the subject matter hereof. This
Agreement is not intended for the benefit of or intended to
confer upon any Person other than the parties hereto any rights
or remedies hereunder.
(c) Certain Events. The Stockholder agrees that this
Agreement and the obligations hereunder shall attach to the
Option Shares and shall be binding upon any Person to which legal
or beneficial ownership of such Option Shares shall pass, whether
by operation of law or otherwise, including, without limitation,
the Stockholder's heirs, guardians, administrators or successors.
Notwithstanding any transfer of Option Shares, the transferor
shall remain liable for the performance of all obligations under
this Agreement of the transferor.
(d) Assignment. This Agreement shall not be assigned
by operation of law or otherwise without the prior written
consent of the other parties provided that Parent and Sub may
assign, in their sole discretion, their rights and obligations
hereunder to any direct or indirect wholly-owned subsidiary of
Parent, although no such assignment shall relieve Parent or Sub
of their obligations hereunder if such assignee does not perform
such obligations.
(e) Amendments, Waivers, Etc. This Agreement may not
be amended, changed, supplemented, waived or otherwise modified
or terminated, except upon the execution and delivery of a
written agreement executed by the relevant parties hereto;
provided that Schedule I hereto may be supplemented by Parent and
Sub by adding the name and other relevant information concerning
any stockholder of the Company who agrees to be bound by the
terms of this Agreement without the agreement of any other party
hereto, and thereafter such added stockholder shall be treated as
a "Stockholder" for all purposes of this Agreement.
(f) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the Stockholder: ____________________________
____________________________
____________________________
Facsimile: ________________
Attention: ________________
If to Parent or Sub: c/o Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3082
Attention: Mr. William R. Kerr
Vice President and
Treasurer
copy to: Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3457
Attention: Anthony J. Lafleur, Esq.
Vice President and Associate
General Counsel
and to: Cleary, Gottlieb, Steen & Hamilton
1 Liberty Plaza
New York, New York 10006
Facsimile: 212-225-3999
Attention: Victor I. Lewkow, Esq.
or to such other address as the Person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(g) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
(h) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(i) Remedies Cumulative. All rights, powers and
remedies provided under this Agreement or otherwise available in
respect hereof at law or in equity shall be cumulative and not
alternative, and the exercise of any thereof by any party shall
not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(j) No Waiver. The failure of any party hereto to
exercise any right, power or remedy provided under this Agreement
or otherwise available in respect hereof at law or in equity, or
to insist upon compliance by any other party hereto with its
obligations hereunder, and any custom or practice of the parties
at variance with the terms hereof shall not constitute a waiver
by such party of its right to exercise any such or other right,
power or remedy or to demand such compliance.
(k) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, without giving effect to the principles of conflicts of
law thereof.
(l) Jurisdiction. Each party hereby irrevocably
submits to the exclusive jurisdiction of the Court of Chancery in
the State of Delaware or the United States District Court for the
Southern District of New York or any court of the State of New
York located in the City of New York in any action, suit or
proceeding arising in connection with this Agreement, and agrees
that any such action, suit or proceeding shall be brought only in
such court (and waives any objection based on forum non
conveniens or any other objection to venue therein); provided,
however, that such consent to jurisdiction is solely for the
purpose referred to in this paragraph (l) and shall not be deemed
to be a general submission to the jurisdiction of said Courts or
in the States of Delaware or New York other than for such
purposes. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN CONNECTION WITH ANY SUCH ACTION, SUIT OR PROCEEDING.
(m) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(n) Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original,
but all of which, taken together, shall constitute one and the
same Agreement.
<PAGE>
IN WITNESS WHEREOF, Parent, Sub and the Stockholder
have caused this Agreement to be duly executed as of the day and
year first above written.
NORTHERN TELECOM INC.
By:_________________________________
Name: Peter Currie
Title: Attorney-in-fact
ELDER CORPORATION
By:_________________________________
Name: William R. Kerr
Title: Vice President and
Treasurer
By:_________________________________
Name:
Title:
<PAGE>
SCHEDULE I TO
STOCK OPTION AGREEMENT
Name of Stockholder Number of Option Shares Owned
___________________ ________________
E. R. Yost
May 30, 1996
Northern Telecom Inc.
Elder Corporation
c/o Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Ladies and Gentlemen:
I refer to that certain Stock Option Agreement, dated
as of May 13, 1996 (the "Agreement"), among Northern Telecom
Inc., a Delaware corporation ("Parent"), Elder Corporation, a
Delaware corporation ("Sub"), and the undersigned (the
"Stockholder"). Capitalized terms not otherwise defined herein
have the meanings assigned to them in the Agreement.
Pursuant to the Agreement, the Stockholder has agreed,
among other things, subject to the conditions set forth therein,
to validly tender pursuant to the Offer (and not to withdraw) all
of the Existing Shares beneficially owned by the Stockholder and
also has granted Parent and Sub the Stock Option with respect to
the Existing Shares. Stockholder wishes to make charitable gifts
of a portion of such Existing Shares, and Parent and Sub hereby
agree to the same, with such Existing Shares remaining
effectively subject to the terms of the Agreement (including the
Stock Option). Accordingly, this is to confirm that,
notwithstanding anything to the contrary in the Agreement:
1. I may make a charitable gift to The Jewish
Communal Fund (the "JCF") of all or a portion of
my Existing Shares, whereafter I shall be fully
and unconditionally released from any and all
obligations required to be performed by me under
the Agreement with respect to any and all shares
of such Common Stock so distributed, but not any
other Option Shares, provided that, (a)
concurrently with such gift, I shall execute and
deliver to Parent and Sub an Indemnity Agreement
in the form of Exhibit A hereto and (b) prior to
making such gift, the JCF shall have executed and
delivered to Parent and Sub a stock option
agreement in the form of Exhibit B hereto, it
being understood that such execution and delivery
is a condition to making such gift.
2. The second sentence of Section 5(e) of the
Agreement is hereby amended to delete the words
"to Parent".
3. Parent and Sub hereby agree that, notwithstanding
the letter dated May 23, 1996 from Parent and Sub
to the Stockholder, the Stockholder shall not be
obligated to tender the Existing Shares pursuant
to the Offer prior to the close of business on
June 7, 1996.
4. Except as expressly modified by this letter, the
Agreement shall remain in full force and effect.
Please confirm your agreement to the foregoing by
signing this letter where indicated below.
Very truly yours,
/s/ E. R. Yost
-----------------------------
E. R. Yost
ACCEPTED AND AGREED:
- -------------------
NORTHERN TELECOM INC.
By: /s/ Peter Currie
-------------------------
ELDER CORPORATION
By: /s/ William R. Kerr
-------------------------
<PAGE>
Exhibit A
- ---------
FORM OF
INDEMNITY AGREEMENT
INDEMNITY AGREEMENT dated as of June 3, 1996, by and
among Northern Telecom Inc., a Delaware corporation ("Parent"),
Elder Corporation, a Delaware corporation and a wholly-owned
subsidiary of Parent ("Sub"), and Eugene R. Yost (the
"Indemnitor").
W I T N E S S E T H:
WHEREAS, Parent, Sub, and Indemnitor entered into a
Stock Option Agreement dated as of May 13, 1996 (the "Yost Option
Agreement");
WHEREAS, the Yost Option Agreement requires, among
other things, that Indemnitor validly tender (and not withdraw)
413,412 shares held by it (the "Shares") of the common stock,
$.0000001 par value per share (the "Company Common Stock"), of
MICOM Communications Corp., a Delaware corporation (the
"Company"), pursuant to and in accordance with the Offer (as
defined in the Yost Option Agreement);
WHEREAS, in connection with the Yost Option Agreement,
pursuant to a letter dated May 30, 1996 from Yost to each of
Parent and Sub (the "Letter Agreement") the Indemnitor is making
a charitable gift to the Jewish Communal Fund (the "Charitable
Institution") of 42,000 shares and, as a condition precedent to
making such gift, the Charitable Institution is entering into a
stock option agreement with respect to such shares with Parent
and Sub in the form of Exhibit B to the Letter Agreement (the
"Charitable Institution Option Agreement"); and
WHEREAS, to induce Parent and Sub to enter into the
Letter Agreement, the Indemnitor agreed pursuant to the Letter
Agreement to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual
premises, covenants and agreements contained herein, the parties
hereto, intending to be legally bound, hereby agree as follows:
1. Indemnity.
(a) The Indemnitor shall indemnify and reimburse
each of Parent and Sub for (I) any payment (including in
connection with the exercise of any appraisal rights under
applicable law) by Sub or the Surviving Corporation (as defined
in the Merger Agreement dated as of May 13, 1996 among Parent,
Sub and the Company) to the Charitable Institution (or its
successors, permitted assigns or any purchaser from the
Charitable Institution of the 42,000 shares) pursuant to the
Offer or, if applicable, the Merger (as defined in the Charitable
Institution Agreement), of any amount for the shares in excess of
the aggregate amount (such aggregate amount, the "Purchase
Price") otherwise payable by Sub to the Charitable Institution
for the shares pursuant to the penultimate sentence of Section
2(a) of the Charitable Institution Option Agreement (excluding
from such excess any amount required to be paid to the Charitable
Institution pursuant to Section 4(c) of the Charitable
Institution Option Agreement; (ii) an amount equal to 50% of the
excess (if any) of (a) the aggregate proceeds (net of selling
commissions, if any) received by the Charitable Institution in
any sale or other disposition by the Charitable Institution of
the shares to a third party in breach of the Charitable
Institution Option Agreement over (b) the Purchase Price for the
shares subject to such sale, provided that such amount otherwise
shall not have been paid over by the Charitable Institution to
Parent or Sub (or any of their respective affiliates), and
provided further that if any of the proceeds of such sale
received by the Charitable Institution shall consist of
securities, for purposes hereof, the proceeds of such sale shall
be deemed to be the net amount that would actually have been
received in an orderly sale of such securities commencing on the
first business day following actual receipt of such securities by
the Charitable Institution, in the written opinion of an
investment banking firm of national reputation selected by Sub
and reasonable satisfactory to the Indemnitor and delivered by
such investment bank to each of them; and (iii) any and all
reasonable out-of-pocket expenses actually incurred by Parent or
Sub in enforcing this Agreement against the Indemnitor.
(b) Any claim for indemnification shall be made
by written notice addressed to the Indemnitor, c/o Pitcairn Trust
Company, One Pitcairn Place, Suite 3000, 165 Township Line Road,
Jenkintown, PA 19046, Fax: (215) 881-6090 setting forth, in
reasonable detail, the basis for such claim. With respect to any
claim for payment under clauses (i) and (ii) of Section 1(a), the
Indemnitor shall be required to remit such payment within 10 days
after receipt of such notice, by certified or bank cashier's
check payable to the order of Parent or Sub as directed in such
notice, provided that in the case of clause (ii), if any of the
proceeds of the sale referred to therein shall consist of
securities, the Indemnitor shall not be required to remit such
payment until after the receipt of the investment banking firm's
written opinion to each of the Indemnitor and Sub as described in
such clause (ii). With respect to any claim for payment under
clause (iii) of Section 1(a), the Indemnitor shall be required to
remit such payment in the same manner as provided for in the
immediately preceding sentence promptly after a final
determination of the amounts due with respect to such claim for
payment.
2. Release. Except as expressly contemplated in this
Agreement, each of Parent and Sub shall fully and unconditionally
release the Indemnitor from any and all obligations to be
performed by the Indemnitor under the Yost Option Agreement with
respect to the 42,000 Shares (and the Indemnitor hereby
relinquishes any and all rights thereunder relating to such
shares, including any rights to payment under Section 4(c)
thereof) from and after the making of the charitable gift of the
shares by the Indemnitor to the Charitable Institution, except
that the Indemnitor's obligations under Section 3 of the Yost
Option Agreement, if any, and the Indemnitor's representations
and warranties under Section 5(e) of the Yost Option Agreement
shall survive such release in accordance with the respective
terms applicable thereto. Except as expressly modified by this
Agreement, the Yost Option Agreement shall remain in full force
and effect.
3. Representations and Warranties. The Indemnitor
hereby represents and warrants to each of Parent and Sub that:
(a) The Indemnitor has the legal capacity, power
and authority to enter into and perform all of the Indemnitor's
obligations under this Agreement.
(b) The execution, delivery and performance of
this Agreement by the Indemnitor will not violate or cause a
breach of or a default under (or give rise to any third party
right of termination, cancellation, modification or acceleration)
any other agreement to which the Indemnitor is a party of violate
any writ, order, decree or judgment binding on the Indemnitor.
(c) No consent or other approval of any third
party is necessary for the execution, delivery and performance of
this Agreement by the Indemnitor.
4. Incorporation by Reference. The provisions
contained in Sections 8(d) (Assignment), (f) (Notices), (g)
(Severability), (h) (Specific Performance), (i) (Remedies
Cumulative), (j) (No Waiver), (k) (Governing Law), (l)
(Jurisdiction), (m) (Descriptive Headings) and (n) (Counterparts)
of the Yost Option Agreement are hereby incorporated by reference
herein as if set forth in full herein.
5. Amendments; Waivers. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or
terminated, except upon the execution and delivery of a written
agreement executed by the parties hereto; provided that any
waiver need only be executed and delivered in writing by the
party against whom the waiver is to be enforced.
6. Entire Agreement; No Third Party Beneficiaries.
This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, written or oral,
between the parties with respect to the subject matter hereof.
This Agreement is not intended for the benefit of or intended to
confer upon any person other than the parties hereto any rights
or remedies hereunder.
IN WITNESS WHEREOF, Parent, Sub and the Indemnitor have
caused this Agreement to be duly executed as of the day and year
first written above.
NORTHERN TELECOM INC.
By: __________________________
Name: Peter Currie
Title: Attorney-in-fact
ELDER CORPORATION
By: __________________________
Name: William R. Kerr
Title: Vice President and
Treasurer
______________________________
Indemnitor: EUGENE R. YOST
<PAGE>
Exhibit B
FORM OF
CHARITABLE INSTITUTION
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT dated as of ______________, 1996
by and among Northern Telecom Inc., a Delaware corporation
("Parent"), Elder Corporation, a Delaware corporation and a
wholly owned subsidiary of Parent ("Sub"), and _____________ (the
"Stockholder").
W I T N E S S E T H:
WHEREAS, Parent, Sub and MICOM Communications Corp., a
Delaware corporation (the "Company"), entered into an Agreement
and Plan of Merger dated as of May 13, 1996 (as such agreement
may hereafter be amended from time to time, the "Merger
Agreement"; capitalized terms used and not defined herein having
the respective meanings given to them in the Merger Agreement),
pursuant to which Sub will be merged with and into the Company
(the "Merger");
WHEREAS, concurrently with the execution and delivery
of the Merger Agreement and as an inducement and a condition to
Parent and Sub entering into the Merger Agreement, Parent, Sub,
Odyssey Partners, L.P., a Delaware limited partnership
("Odyssey"), and an affiliate of Odyssey entered into a Stock
Option Agreement dated as of May 13, 1996 (the "Odyssey Option
Agreement");
WHEREAS, in furtherance of the Merger and pursuant to
the Merger Agreement, on May 17, 1996, Sub commenced a cash
tender offer pursuant to which Sub has offered to purchase all
outstanding shares of Company Common Stock (as defined in Section
1), including all of the Option Shares (as defined in Section 2),
upon the terms and conditions set forth in the Merger Agreement
and the offering documents for the Offer;
WHEREAS, the Odyssey Option Agreement requires, among
other things, that Odyssey validly tender (and not withdraw)
4,737,733 shares held by it (the "Shares") of the Company Common
Stock, pursuant to and in accordance with the Offer;
WHEREAS, in connection with the Odyssey Option
Agreement, pursuant to a letter dated May 30, 1996 from Odyssey
to each of Parent and Sub (the "Letter Agreement") (i) Odyssey
has distributed to ___________ (the "Odyssey Distributee")
______________ of the Shares, which constitute all of the Option
Shares hereunder, and the Odyssey Distributee has entered into a
stock option agreement with respect to the Option Shares with
Parent and Sub in the form of Exhibit A to the Letter Agreement
and (ii) (a) the Odyssey Distributee is making a charitable gift
to the Stockholder of the Option Shares and, as a condition
precedent to making such gift, the Stockholder is entering into
this Agreement with respect to the Option Shares, and (b) the
Odyssey Distributee is entering into an indemnity agreement with
respect to the Option Shares with Parent and Sub in the form of
Exhibit B to the Letter Agreement; and
WHEREAS, as an inducement and a condition to Parent and
Sub entering into the Letter Agreement, and as a condition to the
Odyssey Distributee's making of the charitable gift of the Option
Shares to the Stockholder, Parent and Sub have required that the
Stockholder agree, and the Stockholder has agreed, to enter into
this Agreement.
NOW, THEREFORE, in consideration of the mutual
premises, representations, warranties, covenants and agreements
contained herein, the parties hereto, intending to be legally
bound, hereby agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Acquisition Transaction" shall mean any merger,
consolidation, liquidation, dissolution, recapitalization,
reorganization or other business combination, acquisition or sale
or other disposition of a material amount of assets or
securities, tender offer or exchange offer or any other similar
transaction involving the Company, its securities or any of its
material subsidiaries or divisions.
(b) "beneficially own" or "beneficial ownership" with
respect to any securities shall mean having "beneficial
ownership" of such securities (as determined pursuant to Rule
13d-3 under the Securities Act of 1934, as amended (the "Exchange
Act")), including pursuant to any agreement, arrangement or
understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities
beneficially owned by a Person shall include securities
beneficially owned by all other Persons with whom such Person
would constitute a "group" as within the meaning of Section
13(d)(3) of the Exchange Act.
(c) "Company Common Stock" shall mean at any time the
common stock, $0.0000001 par value, of the Company.
(d) "Person" shall mean any individual, corporation,
partnership, limited liability company, joint venture, firm,
association, trust, unincorporated organization or other entity.
2. Tender of Option Shares. To induce Parent and Sub
to enter into the Letter Agreement and subject to terms and
conditions set forth herein:
(a) Stockholder hereby agrees to validly tender (and
not to withdraw) pursuant to and in accordance with the terms of
the Offer, promptly (but not later than June 7, 1996), for
acceptance by Sub in the Offer, the number of shares of Company
Common Stock set forth opposite the Stockholder's name on
Schedule I hereto (together with any additional shares of Company
Common Stock or other Company securities received as dividends
thereon or received as a result of any stock split,
reclassification or similar transaction relating to such shares,
the "Option Shares"), beneficially owned by it; provided that, if
the purchase price per share of Company Common Stock of the Offer
is for any reason increased to an amount greater than the
Purchase Price (as defined in Section 4), then (i) the
Stockholder will not tender the Option Shares into the Offer
after the first public announcement of such increase, and (ii) if
any Option Shares were tendered into the Offer prior to such
first public announcement, the Stockholder will promptly withdraw
its tender of such Option Shares. In the event that the
Stockholder is not permitted to tender (or is required to
withdraw) the Option Shares pursuant to the proviso to the
immediately preceding sentence, Sub shall be obligated to, and
will, exercise the Stock Option on the first business day
following the purchase of any shares of Company Common Stock
pursuant to the Offer, in which case (notwithstanding the notice
period set forth in Section 4(b)), no notice need be given to the
Stockholder, and the closing of the purchase of the Option Shares
(the "Closing") shall also take place on the first business day
following the purchase of Shares pursuant to the Offer, at 11:00
A.M. (New York time) at Cleary, Gottlieb, Steen & Hamilton, One
Liberty Plaza, New York, NY, or at such other time and place as
the parties shall agree. The Stockholder hereby acknowledges and
agrees that Sub's obligation to accept for payment and pay for
Company Common Stock in the Offer, including the Option Shares,
is subject to the terms and conditions of the Offer.
(b) The Stockholder hereby agrees to permit Parent and
Sub to publish and disclose in the Offer Documents and, if
approval of the stockholders of the Company is required under
applicable law, the Proxy Statement (including all documents and
schedules filed with the Securities and Exchange Commission) its
identify and ownership of Company Common Stock and the nature of
its commitments, arrangements and understandings under this
Agreement.
3. Provisions Concerning Company Common Stock. The
Stockholder hereby agrees that during the period commencing on
the date hereof and continuing until the first to occur of (i)
the Effective Time and (ii) the termination of this Agreement as
set forth in Section 8, at any meeting of the holders of Company
Common Stock, however called, or in connection with any written
consent of the holders of Company Common Stock, the Stockholder
shall vote (or cause to be voted) the Option Shares held of
record or beneficially owned by the Stockholder whether issued,
heretofore owned or hereafter acquired, (i) in favor of the
approval and adoption of the agreement of merger (as such term is
used in Section 251 of the Delaware General Corporation Law)
contained in the Merger Agreement, (ii) in favor of any other
action related to the Merger or in furtherance of the
transactions contemplated by the Merger Agreement and this
Agreement, (iii) against any action or agreement that would
result in a breach in any respect of any covenant, representation
or warranty or any other obligation or agreement of the Company
under the Merger Agreement or this Agreement, and (iv) except as
otherwise agreed to in writing in advance by Sub, against the
following actions (other than the Merger and the transactions
contemplated by the Merger Agreement): (x) any Acquisition
Transaction; and (y) (1) any change in a majority of the persons
who constitute the Board of Directors of the Company; (2) any
change in the present capitalization of the Company or any
amendment of Company's Certificate of Incorporation or By-laws;
(3) any other material change in the Company's corporate
structure or business; and (4) any other action involving the
Company or its subsidiaries which is intended, or could
reasonably be expected, to impede, interfere with, delay,
postpone, or otherwise adversely affect the Offer, the Merger and
the transactions contemplated by this Agreement and the Merger
Agreement. The Stockholder shall not enter into any agreement or
understanding with any Person the effect of which would be
inconsistent with or violative of the provisions and agreements
contained in this Section 3.
4. Option.
(a) To induce Parent and Sub to enter into the Letter
Agreement and subject to the terms and conditions set forth
herein, the Stockholder hereby grants to Sub an irrevocable
option (the "Stock Option") to purchase the Option Shares at a
purchase price per share of $12.00 (the "Purchase Price"). If
(i) the Offer is terminated, abandoned or withdrawn by Parent or
Sub (whether due to the failure of any of the conditions thereto
or otherwise), (ii) the Offer is consummated but Sub has not
accepted for payment and paid for the Option Shares (whether due
to the proviso to the first sentence of Section 2 or otherwise)
or (iii) the Merger Agreement is terminated in accordance with
its terms (other than for the failure of Parent or Sub to fulfill
any material obligation under the Merger Agreement or by mutual
agreement of the parties thereto), the Stock Option shall, in any
such case, become exercisable, in whole but not in part, upon the
first to occur of any such event and remain exercisable, in whole
but not in part, until the date which is 60 days after the date
of the occurrence of such event, so long as: (x) all waiting
periods under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), required for the purchase of
the Stock Option upon such exercise shall have expired or been
waived, and (y) there shall not then be in effect any preliminary
or final injunction or other order issued by any court or
governmental, administrative or regulatory agency or authority
prohibiting the exercise of the Stock Option pursuant to this
Agreement. In the event that the Stock Option is not exercisable
because the circumstances described in clauses (x) and (y) do not
exist, then the Stock Option shall be exercisable for a period
not exceeding an additional 30 days after the 60-day period
referred to in the immediately preceding sentence.
(b) In the event that Sub wishes to exercise the Stock
Option, and subject to Section 2(a), Sub shall send a written
notice to the Stockholder identifying the place and time for the
Closing at least there business days, and not more than five
business days, prior to the Closing. Subject to the terms and
conditions of this Agreement, in reliance on the representations,
warranties and covenants of the Stockholder contained herein and
in full payment for the Option Shares, Sub will deliver at the
Closing to the Stockholder, by wire transfer of immediately
available funds to an account designated by the Stockholder at
lease one business day in advance, an aggregate amount equal to
the product of (x) the Purchase Price and (y) the number of
Option Shares. At the Closing, the Stockholder will deliver, or
cause to be delivered, to Sub certificates representing the
Option Shares duly endorsed to Sub or accompanied by stock powers
duly executed by the Stockholder in blank, together with any
necessary stock transfer stamps properly affixed.
(c) Acquired Option Shares. In the event the Option
Shares are acquired by Sub pursuant to the exercise of the Option
("Acquired Option Shares"), the Stockholder shall be entitled to
receive, upon any subsequent disposition, transfer or sale (other
than to an affiliate who takes such Acquired Option Shares
subject to Sub's obligations under this Section) ("Sale") of the
Acquired Option Shares for which a binding contract of sale is
entered into within 180 days of the Closing, an amount in cash
equal to 50% of the excess (if any) of the aggregate proceeds
received in the Sale (net of selling commissions, if any) over
the aggregate Purchase Price for the Acquired Option Shares
subject to such Sale. If any of the consideration received by
Sub in such Sale consists of securities, for purposes hereof the
proceeds of such Sale shall be deemed to be the net amount that
would actually have been received in an orderly sale of such
securities commencing on the first business day following actual
receipt of such securities by Sub, in the written opinion of an
investment banking firm of national reputation selected by Sub
and reasonably satisfactory to the Stockholder. Any payment due
hereunder shall be paid by Sub to the Stockholder within five
days after receipt of the Sale proceeds or, if any of the
consideration consists of securities, after the receipt of such
investment banking firm's written opinion to the parties.
Nothing herein shall create any duty by Sub to engage in a Sale
of the Acquired Option Shares.
5. Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to Parent and Sub
as follows:
(a) Ownership of Option Shares. The Stockholder is
the record and beneficial owner of the number of Option Shares
set forth opposite the Stockholder's name on Schedule I hereto.
The Stockholder has sole voting power and sole power to issue
instructions with respect to the matters set forth in Sections 2,
3 and 4 hereof, sole power of disposition, sole power of
conversion, sole power to demand appraisal rights and sole power
to agree to all of the matters set forth in this Agreement, in
each case with respect to all of the Option Shares, with no
limitations, qualifications or restrictions on such rights,
subject to applicable securities laws and the terms of this
Agreement.
(b) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and perform all
of the Stockholder's obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which the
Stockholder is a party including, without limitation, any voting
agreement, stockholders' agreement or voting trust. This
Agreement has been duly and validly executed and delivered by the
Stockholder and constitutes a valid and binding agreement of the
Stockholder, enforceable against the Stockholder in accordance
with its terms. There is no beneficiary or holder of a voting
trust certificate or other interest of any trust of which the
Stockholder is trustee whose consent is required for the
execution and delivery of this Agreement or the consummation by
the Stockholder of the transactions contemplated hereby. The
Stockholder hereby revokes any and all proxies with respect to
any of the Option Shares.
(c) No Conflicts. Except for filings and approvals
under the HSR Act or the Exchange Act, if applicable, (x) no
filing with, and no permit, authorization, consent or approval
of, any state or federal public body or authority or any Person
is necessary for the execution of this Agreement by the
Stockholder and the consummation by the Stockholder of the
transactions contemplated hereby and (y) none of the execution
and delivery of this Agreement by the Stockholder, the
consummation by the Stockholder of the transactions contemplated
hereby or compliance by the Stockholder with any of the
provisions hereof shall (1) result in a violation or breach of,
or constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination,
cancellation, modification or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any
kind to which the Stockholder is a party or by which the
Stockholder or any of the Stockholder's properties or assets may
be bound, or (2) violate any order, writ, injunction, decree,
judgment, order, statute, rule or regulation applicable to the
Stockholder or any of the Stockholder's properties or assets.
(d) No Finder's Fees. No broker, investment banker,
financial advisor or other Person is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission
in connection with the transactions contemplated hereby based
upon arrangements made by or on behalf of the Stockholder.
(e) No Encumbrances. The Option Shares and the
certificates representing such Option Shares are now, and at all
times during the term hereof will be, held by the Stockholder, or
by a nominee or custodian for the benefit of the Stockholder,
free and clear of all liens, claims, options, charges, security
interests, proxies, voting trusts or agreements, understandings
or arrangements or any other legal or equitable rights or
encumbrances whatsoever, except for any such encumbrances or
proxies arising hereunder. The transfer by the Stockholder of
the Option Shares to Sub in the Offer or hereunder (after payment
in full of the purchase price thereof) shall pass to and
unconditionally vest in Sub good and valid title to all Option
Shares, free and clear of all claims, liens, restrictions,
security interests, pledges, limitations and encumbrances
whatsoever (other than those in favor of Parent and Sub).
6. Additional Covenants of the Stockholder. In
addition to the covenants and agreements included elsewhere
herein, the Stockholder covenants and agrees as follows:
(a) No Solicitation. The Stockholder (and Persons
acting on behalf of the Stockholder) shall not directly or
indirectly, initiate, solicit (including by way of furnishing
information), encourage or respond to or take any other action
knowingly to facilitate, any inquiries or the making of any
proposal by any Person (other than Parent or any affiliate of
Parent) with respect to, an Acquisition Transaction (an
"Acquisition Proposal"), or enter into or maintain or continue
discussions or negotiate with any Person (other than Parent or
any affiliate of Parent) in furtherance of such inquiries or to
obtain any Acquisition Proposal, or agree to or endorse any
Acquisition Proposal, or authorize or permit any Person acting on
behalf of the Stockholder to do any of the foregoing. The
Stockholder will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any Person
conducted heretofore with respect to any of the foregoing. If
the Stockholder receives any inquiry or proposal regarding any
acquisition Proposal, the Stockholder shall promptly inform Sub
of that inquiry or proposal, the details thereof, the identify of
the Person making such inquiry or proposal and shall in the case
of written proposals or inquiries, furnish Sub with a copy of
such proposal or inquiry (and all amendments and supplements
thereto).
(b) Restriction on Transfer, Proxies and Non-
Interference. Except as contemplated by this Agreement, the
Stockholder shall not directly or indirectly, (i) offer for sale,
sell, transfer, tender, pledge, encumber, assign or otherwise
dispose of, or enter into any contract, option or other
arrangement or understanding with respect to, or consent to the
offer for sale, transfer, tender, pledge, encumbrance, assignment
or other disposition of, any or all of the Option Shares or any
interest therein; (ii) grant any proxies or powers of attorney,
deposit any Option Shares into a voting trust or enter into a
voting agreement with respect to any Option Shares; or (iii) take
any action that would make any representation or warranty of the
Stockholder contained herein untrue or incorrect or have the
effect of preventing or disabling the Stockholder from performing
the Stockholder's obligations under this Agreement.
(c) Waiver of Appraisal Rights. The Stockholder
hereby irrevocably waives any rights of appraisal or rights to
dissent from the Merger that the Stockholder may have.
(d) Stop Transfer; Changes in Option Shares. The
Stockholder agrees with, and covenants to, Parent and Sub that
the Stockholder shall not request that the Company register the
transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Option Shares,
unless such transfer is made in compliance with this Agreement.
In the event of a stock dividend, split-up, merger,
recapitalization, combination, conversion exchange of shares or
the like (in each case with a record date prior to the
termination of this Agreement), (i) the term "Option Shares"
shall be deemed to refer to and include the Option Shares as well
as all such stock dividends and distributions and any securities
into which or for which any or all of the Option Shares may be
changed or exchanged and such dividends, distributions and
securities, as the case may be, shall be paid to Sub at the
Closing or promptly following the receipt of such dividend or
distribution, if the Closing theretofor shall have occurred and
(ii) the number and kind of shares subject to this Agreement and
Purchase Price shall be appropriately adjusted to reflect changes
made in the Company Common Stock so that Sub shall receive, upon
exercise of the Stock Option and payment of the Purchase Price,
the number and class of shares, other securities, property or
cash that Sub would have received in respect of the Option Shares
if the Stock Option had been exercised and the Option Shares had
been issued to Sub immediately prior to such event or the record
date therefor, as applicable.
7. Termination. This Agreement (other than Section
4(c) if, and to the extent applicable) shall terminate, and no
party shall have any rights or obligations hereunder and this
Agreement shall become null and void and have no effect from and
after the last date on which the Stock Option is exercisable
pursuant to Section 4.
8. Miscellaneous.
(a) Further Assurances. From time to time, at the
other party's request and without further consideration, each
party hereto shall execute and deliver such additional documents
and take all such further lawful action as may be necessary or
appropriate to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by
this Agreement.
(b) Entire Agreement; No Third Party Beneficiaries.
This Agreement constitutes the entire agreement among the parties
with respect to the subject matter hereof and supersedes all
other prior agreements and understandings, written or oral, among
the parties with respect to the subject matter hereof. This
Agreement is not intended for the benefit of or intended to
confer upon any Person other than the parties hereto any rights
or remedies hereunder.
(c) Certain Events. The Stockholder agrees that this
Agreement and the obligations hereunder shall attach to the
Option Shares and shall be binding upon any Person to which legal
or beneficial ownership of such Option Shares shall pass, whether
by operation of law or otherwise, including, without limitation,
the Stockholder's heirs, guardians, administrators or successors.
Notwithstanding any transfer of Option Shares, the transferor
shall remain liable for the performance of all obligations under
this Agreement of the transferor.
(d) Assignment. This Agreement shall not be assigned
by operation of law or otherwise without the prior written
consent of the other parties provided that Parent and Sub may
assign, in their sole discretion, their rights and obligations
hereunder to any direct or indirect wholly-owned subsidiary of
Parent, although no such assignment shall relieve Parent or Sub
of their obligations hereunder if such assignee does not perform
such obligations.
(e) Amendments, Waivers, Etc. This Agreement may not
be amended, changed, supplemented, waived or otherwise modified
or terminated, except upon the execution and delivery of a
written agreement executed by the relevant parties hereto;
provided that Schedule I hereto may be supplemented by Parent and
Sub by adding the name and other relevant information concerning
any stockholder of the Company who agrees to be bound by the
terms of this Agreement without the agreement of any other party
hereto, and thereafter such added stockholder shall be treated as
a "Stockholder" for all purposes of this Agreement.
(f) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the Stockholder: ____________________________
____________________________
____________________________
Facsimile: ________________
Attention: ________________
If to Parent or Sub: c/o Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3082
Attention: Mr. William R. Kerr
Vice President and
Treasurer
copy to: Northern Telecom Limited
3 Robert Speck Parkway
Mississauga, Ontario
Canada L42 3C8
Facsimile: 905-566-3457
Attention: Anthony J. Lafleur, Esq.
Vice President and Associate
General Counsel
and to: Cleary, Gottlieb, Steen & Hamilton
1 Liberty Plaza
New York, New York 10006
Facsimile: 212-225-3999
Attention: Victor I. Lewkow, Esq.
or to such other address as the Person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(g) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
(h) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(i) Remedies Cumulative. All rights, powers and
remedies provided under this Agreement or otherwise available in
respect hereof at law or in equity shall be cumulative and not
alternative, and the exercise of any thereof by any party shall
not preclude the simultaneous or later exercise of any other such
right, power or remedy by such party.
(j) No Waiver. The failure of any party hereto to
exercise any right, power or remedy provided under this Agreement
or otherwise available in respect hereof at law or in equity, or
to insist upon compliance by any other party hereto with its
obligations hereunder, and any custom or practice of the parties
at variance with the terms hereof shall not constitute a waiver
by such party of its right to exercise any such or other right,
power or remedy or to demand such compliance.
(k) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, without giving effect to the principles of conflicts of
law thereof.
(l) Jurisdiction. Each party hereby irrevocably
submits to the exclusive jurisdiction of the Court of Chancery in
the State of Delaware or the United States District Court for the
Southern District of New York or any court of the State of New
York located in the City of New York in any action, suit or
proceeding arising in connection with this Agreement, and agrees
that any such action, suit or proceeding shall be brought only in
such court (and waives any objection based on forum non
conveniens or any other objection to venue therein); provided,
however, that such consent to jurisdiction is solely for the
purpose referred to in this paragraph (l) and shall not be deemed
to be a general submission to the jurisdiction of said Courts or
in the States of Delaware or New York other than for such
purposes. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL
BY JURY IN CONNECTION WITH ANY SUCH ACTION, SUIT OR PROCEEDING.
(m) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(n) Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original,
but all of which, taken together, shall constitute one and the
same Agreement.
<PAGE>
IN WITNESS WHEREOF, Parent, Sub and the Stockholder
have caused this Agreement to be duly executed as of the day and
year first above written.
NORTHERN TELECOM INC.
By:_________________________________
Name: Peter Currie
Title: Attorney-in-fact
ELDER CORPORATION
By:_________________________________
Name: William R. Kerr
Title: Vice President and Treasurer
By:_________________________________
Name:
Title:
<PAGE>
SCHEDULE I TO
STOCK OPTION AGREEMENT
Name of Stockholder Number of Option Shares Owned
___________________ _________________
