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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 8-K
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Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report May 3, 1996
(Date of earliest event reported): April 20, 1996
HARBINGER CORPORATION
(Exact name of Company specified in its charter)
<TABLE>
<S> <C> <C>
GEORGIA 0-26298 58-1817306
(State or other jurisdiction of (Commission File Number) (IRS Employer Identification No.)
incorporation or organization)
1055 LENOX PARK BOULEVARD, ATLANTA, GEORGIA 30319
(Address of principal executive offices) (Zip Code)
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(404) 841-4334
(Company's telephone number, including area code)
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Item 2. Acquisition or Disposition of Assets.
Pursuant to an agreement dated April 20, 1996 (effective March 31,
1996) (the "Plan of Reorganization"), Harbinger Corporation (the
"Company") completed its purchase of the remaining 78.9% of common
stock of Harbinger N.V.("HNV"), a Dutch corporation based in Hoofddorp,
The Netherlands from HNV's two other shareholders, Vulcan Ventures,
Inc.("Vulcan"), a Washington corporation, and AXA Equity and Law Life
Assurance Society LTD.("Equity"), a corporation organized under the
laws of England. In November 1993, the Company made a minority
investment in HNV, which markets electronic commerce products and
services in the European market and entered into certain development,
license and service agreements with HNV at that time. The Company
acquired the remaining stock of HNV by exchanging 38,709 unregistered
shares of the Company's common stock. Pursuant to the Plan of
Reorganization the Company has agreed to use its best efforts
to include the issued shares in any subsequent registration of common
stock. The Company took a $300,000 charge in the first quarter of 1996
related to the acquisition of in-process research that had not reached
technological feasibility. The number of shares of Company common
stock issued in the transaction was determined through negotiations
between the Company, Vulcan and Equity.
As of the date of this filing, Vulcan owns approximately 14.8% and
Equity owns approximately 7.6% of the Company's outstanding common
stock. William D. Savoy, President of Vulcan Northwest, a Washington
corporation and an affiliate of Vulcan, currently serves on the
Company's Board of Directors. A more detailed description of the
transaction is contained in the Plan of Reorganization filed as
Exhibit 2(a) and hereby incorporated herein by this reference.
Item 7. Financial Statements and Exhibits.
a) Financial Statements of Business Acquired: To be filed by
amendment as soon as practicable but not later than July 5, 1996.
b) Pro Forma Financial Information: To be filed by amendment as soon
as practicable but not later than July 5, 1996.
c) Exhibits:
2(a) Agreement and Plan of Reorganization dated April 20, 1996
among the Company, Vulcan Ventures, Inc. and AXA Equity & Law Life
Assurance Society, Ltd.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HARBINGER CORPORATION
/s/ Joel G. Katz
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JOEL G. KATZ
Vice President, Finance
(Principal Financial Officer;
Principal Accounting Officer)
Date: May 3, 1996
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Exhibit 2(a)
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is made and
entered into effective as of March 29, 1996, between and among HARBINGER
CORPORATION, a corporation organized under the laws of the State of
Georgia ("Harbinger"), VULCAN VENTURES, INC., a corporation organized
under the laws of the State of Washington ("Vulcan"), and AXA EQUITY &
LAW LIFE ASSURANCE SOCIETY, LTD., a corporation organized under the laws
of the United Kingdom ("Equity"; Vulcan and Equity sometimes referred to
herein collectively as the "Other Shareholders"), being the owners of
record of all of the issued and outstanding stock of HARBINGER NV, a
corporation organized under the laws of the Netherlands (the "Company").
FACTUAL BACKGROUND
Harbinger desires to acquire and the Other Shareholders desire to
transfer to Harbinger all of the shares of stock in the Company owned by
the Other Shareholders in a transaction intended to qualify as a
reorganization within the meaning of Section 368(a)(1)(B) and Section 367
of the Internal Revenue Code of 1986, as amended (the "IRC").
NOW THEREFORE, Harbinger and the Other Shareholders adopt this Agreement
and Plan of Reorganization and agree as follows:
ARTICLE 1. EXCHANGE OF STOCK
SECTION 1.1. NUMBER OF SHARES. The Other Shareholders agree to
transfer to Harbinger at the Closing, defined below, the number of common
shares of the Company, NLG. 1 par value per share, shown opposite their
names on EXHIBIT A attached hereto ("Company Shares"), in exchange for the
number of shares of common stock of Harbinger, $0.0001 par value per
share, shown opposite their names on EXHIBIT A attached hereto ("Harbinger
Shares"), to be issued at the Closing to the Other Shareholders and
Harbinger agrees to issue and deliver the Harbinger Shares at the Closing
in exchange therefor.
SECTION 1.2. DELIVERY OF CERTIFICATES BY OTHER SHAREHOLDERS. The
transfer of Company Shares by the Other Shareholders shall be effected at
the Closing by the delivery to Harbinger of Powers of Attorney in a form
suitable to enable the transfer of the Company Shares under Dutch law
together with any certificates representing the transferred shares that
are possessed by the Other Shareholders endorsed in blank or accompanied
by stock powers executed in blank.
ARTICLE 2. OTHER AGREEMENTS
SECTION 2.1. OPTION CONVERSION AGREEMENTS. The parties hereto
acknowledge that, in connection with the reorganization contemplated
herein, Harbinger and the Company are entering into Option Conversion
Agreements with all of the persons holding options to acquire stock of the
Company pursuant to which such options shall be released and terminated in
exchange for the grant of options to acquire stock in Harbinger.
SECTION 2.2. RELEASE OF OTHER AGREEMENTS. The parties hereto
release and terminate all agreements between or among any of such parties
relating to the Company, including, without limitation, that certain
Amended and Restated Shareholders Agreement dated December 29, 1995, and
further release, terminate and discharge any and all agreements pursuant
to which the Other Shareholders have a right to purchase or acquire any
option, warrant, convertible security or additional interest in the
Company.
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SECTION 2.3. CAPITALIZATION OF THE COMPANY. Each of the parties
hereto acknowledges and agrees that the Capitalization Table attached
hereto as EXHIBIT B accurately reflects all of the outstanding securities
of the Company, and with respect to securities owned by any such party,
that the securities shown on the Capitalization Table opposite such
party's name are all of the securities, including options, warrants,
stock, and any other rights to purchase or acquire additional interests in
the Company, owned and held by such party.
ARTICLE 3. THE CLOSING
SECTION 3.1. CLOSING. The closing (the "Closing") of the
transactions contemplated by this Agreement shall take place by
deliveries to Morris, Manning & Martin, L.L.P., 1600 Atlanta
Financial Center, 3343 Peachtree Road, Atlanta, Georgia 30326-1022,
of all documentation required hereunder of the Other Shareholders at
such time and date as the parties hereto shall agree, but in any
event, the Closing shall occur on or before June 1, 1996. The date
on which the Closing actually occurs is sometimes referred to
hereinafter as the "Closing Date."
SECTION 3.2. DELIVERIES AT THE CLOSING. At the Closing, each of
the following items shall be delivered by the parties as indicated as
appropriate:
(a) The Other Shareholders shall deliver to Harbinger the
following:
(i) an executed version of this Agreement;
(ii) Powers of Attorney with signatures thereon, in a form
suitable to enable transfer of the Company Shares under Dutch law; and
(iii) to the extent the Other Shareholders possess
certificates, certificates representing the Company Shares being
transferred, such certificates duly endorsed for transfer, with signatures
thereon in a form suitable for transfer on the books of the Company.
(b) Harbinger shall deliver to the Other Shareholders the
following:
(i) an executed version of this Agreement; and
(ii) certificates for the Harbinger Shares issued in
exchange for the Company Shares.
In each case the certificates and documents to be delivered and received
shall be in form and substance reasonably satisfactory to the recipients.
SECTION 3.3. FURTHER ASSURANCES. Each of the parties hereto, from
time to time after the Closing, at the request of another party to this
Agreement (a "Requesting Party"), agrees to execute, acknowledge, and
deliver to any Requesting Party such other instruments, agreements,
documents, certifications, and further assurances as such Requesting Party
may reasonably request for the purposes of carrying out evidences and
effecting the intended purpose of this Agreement.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES
OF THE OTHER SHAREHOLDERS
For the purpose of inducing Harbinger to enter into this Agreement, each
Other Shareholder jointly and severally represents and warrants to
Harbinger that:
SECTION 4.1. TITLE TO COMPANY SHARES AND AUTHORITY.
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(a) With respect to the Company Shares being transferred by it,
as of the date hereof: (i) each Other Shareholder has the unrestricted
power and the unqualified right to sell, assign, and deliver to Harbinger
good, valid, and marketable title to such Company Shares, free and clear
of any liens, claims, encumbrances and equitable rights, (ii) no option,
contract, or other agreement exists pursuant to which any person or entity
has any right to purchase or otherwise acquire, now or in the future, any
portion of any of such Company Shares, and (iii) neither Other Shareholder
owns or holds any option, warrant, convertible security, or any right,
contractual or otherwise, to purchase or acquire, any additional interests
in the Company.
(b) The execution, delivery, and performance of this Agreement
by the Company and each Other Shareholder has been duly and validly
authorized and approved by all necessary action on the part of each Other
Shareholder. Each Other Shareholder has the full legal capacity and the
full legal right, power, and authority to enter into this Agreement and to
consummate the transactions contemplated hereby without the consent or
approval of any other person or entity.
(c) This Agreement is a legal, valid, and binding obligation of
each Other Shareholder and is enforceable against each Other Shareholder
in accordance with its terms.
(d) The Company Shares are duly and validly issued, fully paid
and non-assessable.
SECTION 4.2. INVESTMENT REPRESENTATIONS.
(a) The Harbinger Shares being acquired herein are being
acquired for investment purposes only with no present intention of
dividing or allowing others to participate in this investment or of
reselling or otherwise participating, directly or indirectly, in a
distribution of the Harbinger Shares. Each Other Shareholder shall not
make any sale, transfer or other disposition of the Harbinger Shares to a
U.S. person or inside the United States without registration under the
United States Securities Act of 1933, as amended (the "Federal Act") or
applicable securities laws of any other jurisdiction or unless an
exemption from registration is available under those acts and laws,
respectively; and in the case of an exemption, unless upon request of
Harbinger, Harbinger has received an opinion of counsel satisfactory to
Harbinger that such transaction is in compliance with the Federal Act and
the applicable laws of all other jurisdictions.
(b) Each Other Shareholder understands that the Harbinger
Shares purchased hereunder have not been, and will not be, registered with
the United States Securities and Exchange Commission under the Federal Act
nor under applicable securities laws of any other jurisdiction in reliance
upon exemption(s) contained in the Federal Act and under regulations
promulgated under the Federal Act and exemptions contained in applicable
securities laws of any other jurisdiction and that Harbingers' reliance
upon such exemptions is based in part upon each Other Shareholder's
representations, warranties, and agreements contained in this Agreement.
(c) Each Other Shareholder is either (i) an accredited investor
as defined in Regulation D promulgated under the Federal Act or (ii) a
non-U.S. person as defined in Regulation S promulgated under the Federal
Act, and is familiar with the business in which Harbinger is engaged and,
based upon each Other Shareholder's knowledge and experience in financial
and business matters, each Other Shareholder is familiar with investments
of the sort
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that each Other Shareholder is undertaking herein and that each Other
Shareholder is fully aware of the problems and risks involved in making an
investment of this type.
(d) Each Other Shareholder has made such inquiry into the
structure and operations of Harbinger as each Other Shareholder's advisors
have thought necessary and prudent in the circumstances.
(e) Each Other Shareholder's financial circumstances are such
that each Other Shareholder can bear the economic risk of the proposed
investment in the Harbinger Shares for an indefinite period of time and
can afford to sustain a complete loss with respect to the Harbinger Shares
being purchased.
(f) Each Other Shareholder has knowledge and experience in
financial and business matters and that each Other Shareholder is capable
of evaluating the merits and risks of a purchase of the Harbinger Shares
and that each Other Shareholder has reached its own independent conclusion
as to the suitability of an investment in the Harbinger Shares and each
Other Shareholder's ability to bear the economic risks of such an
investment.
(g) Each Other Shareholder has had an opportunity to consult
with its attorney, financial advisor, tax advisor and others regarding all
financial, securities, tax and other aspects of this transaction and is
not relying on any representation or statement of Harbinger with respect
to the consequences of this transaction.
(h) Each Other Shareholder acknowledges that each Other
Shareholder and each Other Shareholder's advisors have received and
reviewed (i) this Agreement; (ii) Harbinger's Form 10-K for the fiscal
year ended December 31, 1995 attached hereto as EXHIBIT C; (iii) the
description of Harbinger's capital stock attached hereto as EXHIBIT D;
(iv) the Proxy Statement with respect to Harbinger's annual meeting to be
held on May 8, 1996 attached hereto as EXHIBIT E; and (v) Harbinger's
Annual Report for the fiscal year ended December 31, 1995 attached hereto
as EXHIBIT F; and have had an opportunity to ask questions of and to
receive answers from the officers of Harbinger and to obtain additional
information in writing to the extent that Harbinger possesses such
information or could acquire it without unreasonable effort or expense:
(i) relative to Harbinger and the offering of the Harbinger Shares; and
(ii) necessary to verify the accuracy of any information, documents, books
and records furnished. All such materials and information requested by
each Other Shareholder and each Other Shareholder's advisors (including
information requested to verify information previously furnished) have
been made available and examined by each Other Shareholder or each Other
Shareholder's advisors.
(i) The Harbinger Shares have been transferred to each Other
Shareholder without any form of general solicitation or advertising of any
type by or on behalf of Harbinger or any of its officers, directors,
affiliates, agents or representatives.
(j) Each Other Shareholder did not solicit an offer to sell the
Harbinger Shares from Harbinger.
(k) If either of the Other Shareholder is a non-U.S. person as
defined in Regulation S promulgated under the Federal Act, such Other
Shareholder agrees that it will not attempt to pledge, transfer, convey or
otherwise dispose of the Harbinger Shares in the United States except in a
transaction made pursuant to the following offering restrictions: all
offers and sales of the Harbinger Shares to a U.S. person or inside the
United States
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prior to the expiration of a one-year period immediately following the
date of this Agreement shall be made only upon receipt by Harbinger of an
opinion of counsel satisfactory to Harbinger that such transaction
complies with all applicable securities laws and only (i) in accordance
with the provisions of Rules 903 or 904 of Regulation S, or (ii) pursuant
to the registration requirements under the Federal Act, or (ii) pursuant
to an available exemption from registration under the Federal Act. Each
Other Shareholder consents to the placement of legends on any certificates
or documents representing any of the Harbinger Shares stating that they
have not been registered under the Federal Act or any applicable
securities laws of other jurisdictions and setting forth or referring to
such offering restrictions. Each Other Shareholder is aware that
Harbinger will make a notation in its appropriate records, and notify its
transfer agent, with respect to the restrictions on the transferability of
the Harbinger Shares.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF HARBINGER
Harbinger hereby represents and warrants to each of the Other
Shareholders, as follows:
SECTION 5.1. ORGANIZATION AND QUALIFICATION. Harbinger is a
corporation duly organized, validly existing, and in good standing under
the laws of the State of Georgia and has all corporate power and authority
to conduct its business, to own, lease, or operate its properties in the
places where such business is conducted and such properties are owned,
leased, or operated. Harbinger is duly qualified to do business and will
be in good standing as a foreign corporation in each jurisdiction where
the failure to be so qualified would have a material adverse effect on the
business or financial condition of Harbinger.
SECTION 5.2. AUTHORITY. Harbinger has full power and authority
to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery, and performance of this
Agreement by Harbinger has been duly and validly authorized and approved
by all necessary action on the part of Harbinger, and this Agreement is
the legal, valid, and binding obligation of Harbinger enforceable against
Harbinger in accordance with its terms, except as enforceability may be
limited by applicable equitable principles or by bankruptcy, liquidation,
insolvency, reorganization, moratorium, or similar laws affecting
creditors' rights generally, and by the exercise of judicial discretion in
accordance with equitable principles.
SECTION 5.3. HARBINGER SHARES. The Harbinger Shares, when issued,
will be duly and validly issued, fully paid and non-assessable.
SECTION 5.4. INVESTMENT REPRESENTATIONS.
(a) The Company Shares being acquired herein are being
acquired for investment purposes only with no present intention of
dividing or allowing others to participate in this investment or of
reselling or otherwise participating, directly or indirectly, in a
distribution of the Company Shares. Harbinger shall not make any sale,
transfer or other disposition of the Company Shares to a U.S. person or
inside the United States without registration under the Federal Act or
applicable securities laws of any other jurisdiction or unless an
exemption from registration is available under those acts and laws,
respectively; and in the case of an exemption, unless upon request of the
Company, the Company has received an opinion of counsel satisfactory to
the Company that such transaction is in compliance with the Federal Act
and the applicable laws of all other jurisdictions.
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(b) Harbinger understands that the Company Shares purchased
hereunder have not been, and will not be, registered with the United
States Securities and Exchange Commission under the Federal Act nor under
other applicable securities laws of any other jurisdiction in reliance
upon exemptions contained in the Federal Act and under regulations
promulgated under the Federal Act and exemptions contained in applicable
securities laws of any other jurisdiction and that the Company's and each
Other Shareholder's reliance upon such exemptions is based in part upon
Harbinger' representations, warranties, and agreements contained in this
Agreement.
(c) Harbinger is an accredited investor as defined in Regulation
D promulgated under the Federal Act, and is familiar with the business in
which the Company is engaged and, based upon Harbinger' knowledge and
experience in financial and business matters, Harbinger is familiar with
investments of the sort that Harbinger is undertaking herein and that
Harbinger is fully aware of the problems and risks involved in making an
investment of this type.
(d) Harbinger has made such inquiry into the structure and
operations of the Company as Harbinger and Harbinger' advisors have
thought necessary and prudent in the circumstances.
(e) Harbinger' financial circumstances are such that Harbinger
can bear the economic risk of the proposed investment in the Company
Shares for an indefinite period of time and can afford to sustain a
complete loss with respect to the Company Shares being purchased.
(f) Harbinger has knowledge and experience in financial and
business matters and that Harbinger is capable of evaluating the merits
and risks of a purchase of the Company Shares and that Harbinger has
reached its own independent conclusion as to the suitability of an
investment in the Company Shares and its ability to bear the economic
risks of such an investment.
(g) Harbinger has had an opportunity to consult with its
attorneys, financial advisors, tax advisors and others regarding all
financial, securities, tax and other aspects of this transaction and is
not relying on any representation, warranty, or statement of any Other
Shareholder or the Company with respect to the consequences of the
transactions described herein.
(h) Neither the Company nor any Other Shareholder has provided
any information to Harbinger regarding the value of the Company Shares,
the Company's future prospects for success, nor has the Company or any
Other Shareholder made any representations or warranties to Harbinger
regarding the merits or advisability of purchasing the Company Shares.
(i) The Company Shares have been transferred to Harbinger
without any form of general solicitation or advertising of any type by or
on behalf of any Other Shareholder or the Company or any of its officers,
directors, affiliates, agents or representatives.
(j) Harbinger did not solicit an offer to sell the Company
Shares from the Company or any Other Shareholder.
ARTICLE 6. CERTAIN COVENANTS OF THE PARTIES
Each Other Shareholder, jointly and severally, covenant and agree with
Harbinger and the Company as follows:
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SECTION 6.1. B-REORGANIZATION STATUS. From the date hereof and
forever thereafter, and except to the extent that Harbinger shall
otherwise consent in writing, each Other Shareholder shall:
(a) Take all steps reasonably necessary to treat the transactions
contemplated hereby as transactions qualifying as a non-taxable
reorganization within the meaning of Section 368(a)(1)(B) and Section 367
of the Internal Revenue Code of 1986, as amended.
(b) Maintain consistency in the filing and reporting of the transactions
contemplated hereby.
(c) Cooperate in good faith with all filing and reporting of the
transactions contemplated hereby undertaken by Harbinger.
(d) Not take any action which either Other Shareholder knows or has
reason to know would cause the transactions contemplated hereby to be
disqualified from treatment as a non-taxable reorganization with respect
to any party hereto.
SECTION 6.2. IRC REPRESENTATIONS REGARDING B-REORGANIZATION. The
parties hereto represent and warrant to each other party hereto as
follows:
(a) The fair market value of the Harbinger Shares received by each Other
Shareholder will be approximately equal to the fair market value of the
Company Shares surrendered in the exchange.
(b) There is no plan or intention by the Other Shareholders, and to the
best of the knowledge of the management of the Company, there is no plan
or intention on the part of the Other Shareholders to sell, exchange, or
otherwise dispose of a number of the Harbinger Shares received in the
transaction that would reduce the Other Shareholders' ownership of the
Harbinger Shares to a number of shares having a value, as of the
effective date of the transactions contemplated hereby, of less than 50
percent of the value of all of the formerly outstanding stock of the
Company as of the same date. Shares of Company stock and the Harbinger
Shares held by the Other Shareholders and otherwise sold, redeemed, or
disposed of prior or subsequent to the transaction will be considered in
making this representation.
(c) The Company has no plan or intention to issue additional shares of
its stock that would result in Harbinger losing control of the Company
within the meaning of IRC Section 368(c)(1).
(d) Harbinger has no present plan or intention to liquidate the Company;
to merge the Company into another corporation; to cause the Company to
sell or otherwise dispose of any of its assets, except for dispositions
made in the ordinary course of business; or to sell or otherwise dispose
of any of the Company Shares acquired in the transaction, except for
transfers described in IRC Section 368(a)(2)(C).
(e) Harbinger has no plan or intention to reacquire any of the Harbinger
Shares issued in the transaction contemplated hereby.
(f) Harbinger is acquiring the Company Shares solely in exchange for
Harbinger voting stock. Further, no liabilities of the Company or the
Other Shareholders will be assumed by Harbinger, nor will any of the
Company Shares be subject to any liabilities.
(g) At the time of the transaction, the Company will not have
outstanding any warrants, options, convertible securities, or any other
type of right pursuant to which any person could acquire stock in the
Company that, if exercised or converted, would affect Harbinger's
acquisition or retention of control of the Company, as defined in IRC
Section 368(c)(1).
(h) Following the transaction, the Company will continue its historic
business or use a significant portion of its historic business assets in
a business.
(i) No two parties to the transaction are investment companies as
defined in IRC Sections 368(a)(2)(F)(iii) and 368(a)(2)(F)(iv).
(j) There will be no dissenters to the transaction contemplated hereby.
SECTION 6.3. RELEASE OF HARBINGER AND THE COMPANY. Each Other
Shareholder and each of their officers, directors, employees and
affiliates, hereby agree to and do hereby release, acquit and forever
discharge Harbinger, the Company and each of their officers, directors,
employees and affiliates from any and all manner of actions and causes of
action, suits, debts, claims and demands whatsoever at law or in equity,
known or unknown, actual or contingent, which they had, now have, or
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may later have or claim to have against Harbinger and/or the Company, now
accrued or which may hereafter accrue, involving or based in whole or in
part upon any agreements, contracts, instruments, writings, facts,
conduct, activities, transactions, events or occurrences, which have or
allegedly have existed, occurred, happened, arisen or transpired at any
time from the beginning of time to the date of this Agreement, known or
unknown.
SECTION 6.4. REGISTRATION RIGHTS. Harbinger hereby grants the
Other Shareholders certain registration rights with respect to the
Harbinger Shares pursuant to the terms and conditions set forth in EXHIBIT
G attached hereto.
ARTICLE 7. CONDITIONS PRECEDENT TO OBLIGATIONS OF HARBINGER
The obligation of Harbinger to consummate the transactions contemplated
by this Agreement shall be subject to the satisfaction, on or before the
Closing Date, of each of the following conditions, all or any of which
may be waived in writing, in whole or in part, by Harbinger:
SECTION 7.1. REPRESENTATIONS AND WARRANTIES. All information
required to be furnished or delivered by each Other Shareholder pursuant
to this Agreement shall have been furnished or delivered as of the date
hereof and as of the Closing Date, as required hereunder; the
representations and warranties made by each Other Shareholder in Article 3
hereof shall be true and correct on and as of the Closing Date with the
same force and effect as though such representations and warranties had
been made on and as of the Closing Date.
ARTICLE 8. CONDITIONS PRECEDENT TO OBLIGATIONS
OF OTHER SHAREHOLDERS
The obligation of each Other Shareholder to consummate the transactions
contemplated by this Agreement shall be subject to the satisfaction, on
or before the Closing Date hereunder, of each of the following
conditions, all or any of which may be waived, in whole or in part, by
the Other Shareholders:
SECTION 8.1. REPRESENTATIONS AND WARRANTIES. All information
required to be furnished or delivered by Harbinger pursuant to this
Agreement shall have been furnished or delivered as of the date hereof and
the Closing Date as required hereunder; the representations and warranties
made by Harbinger in Article 4 hereof shall be true and correct in all
material respects on and as of the Closing Date with the same force and
effect as though such representations and warranties had been made on and
as of the Closing Date.
ARTICLE 9. TERMINATION
SECTION 9.1. TERMINATION. This Agreement may be terminated at any
time prior to Closing:
(a) by the mutual consent of Harbinger and the Other
Shareholders; or
(b) by any party (other than a party that is in material breach
of its obligations under this Agreement) if the Closing shall not have
occurred on or before June 1, 1996.
ARTICLE 10. INDEMNIFICATION
SECTION 10.1. INDEMNIFICATION. Each party hereto does hereby agree
to indemnify and hold harmless each other party, and any affiliated
corporation or entity, the partners, officers, directors and employees of
any of the foregoing and any professional advisors thereto, from and
against any and all loss, damage, liability or expense, including costs
and reasonable attorneys' fees, to which any other
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party may become subject or which such other party may incur by reason of
or in connection with any misrepresentation made by any such party, as
the case may be, any breach of any of such party's representations or
warranties, or any failure to fulfill any of such party's covenants or
agreements, under this Agreement.
ARTICLE 11. GENERAL PROVISIONS
SECTION 11.1. FEES AND EXPENSES. Each party to this Agreement
shall pay the fees and expenses incurred by such party in connection with
the transactions contemplated hereby.
SECTION 11.2. NOTICES. All notices, request, demands, and other
communications hereunder shall be in writing and shall be deemed received
when delivered (i) in person or by courier or when received by facsimile
transmission, or (ii) five days after deposit, postage-prepaid, in the
U.S. Mail, or mailed by registered first class or certified mail, in each
case addressed to a party at the address set forth below such party's
signature hereto or to such other address as the parties hereto may
designate in writing to the others in accordance with this Section 11.2.
SECTION 11.3. ASSIGNMENT AND BINDING EFFECT. This Agreement shall
not be assignable by any of the parties hereto without the written
consent of the other parties.
SECTION 11.4 HEADINGS, GENDER, AND PERSON. All section headings
contained in this Agreement are for convenience of reference only, do not
form a part of this Agreement and shall not affect in any way the meaning
or interpretation of this Agreement. Words used herein, regardless of the
number and gender specifically used, shall be deemed and construed to
include any other number, singular or plural, and any other gender,
masculine, feminine, or neuter, as the context requires. Any reference to
a "person" herein shall include an individual, firm, corporation,
partnership, trust, governmental authority or body, association,
unincorporated organization or any other entity.
SECTION 11.5. COUNTERPARTS. This Agreement may be executed in two
or more counterparts, including by facsimile, all of which shall be
considered one and the same agreement and shall become effective when each
counterpart has been signed by each party and delivered to the other party
hereto.
SECTION 11.6. INTEGRATION OF AGREEMENT. This Agreement supersedes
all prior agreements, oral and written, between the parties hereto with
respect to the subject matter hereof. Neither this Agreement, nor any
provision hereof, may be changed, waived, discharged, supplemented, or
terminated orally, but only by an agreement in writing signed by the party
against which the enforcement of such change, waiver, discharge, or
termination is sought.
SECTION 11.7. TIME OF ESSENCE. Time is of the essence in this
Agreement.
SECTION 11.8. GOVERNING LAW. This Agreement shall be construed
under the laws of the State of Georgia. The parties agree that any
appropriate courts located in the State of Georgia shall have jurisdiction
of any case or controversy arising under or in connection with this
Agreement and shall be a proper forum in which to adjudicate such case or
controversy. The parties consent to the jurisdiction of such courts.
SECTION 11.9. PARTIAL INVALIDITY. Whenever possible, each provision
hereof shall be interpreted in such manner as to be effective and valid
under applicable law, but in case any one or more of the provisions
contained herein shall, for any reason, be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other
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<PAGE> 10
provisions of this Agreement, and this Agreement shall be construed as if
such invalid, illegal, or unenforceable provision or provisions had never
been contained herein unless the deletion of such provision or provisions
would result in such a material change as to cause completion of the
transactions contemplated hereby to be unreasonable.
SECTION 11.10. ARBITRATION. Any controversy, dispute, or claim
arising out of or relating to any dispute or claim under this Agreement
shall be submitted to arbitration, and all other controversies, disputes,
or claims arising out of or relating to this Agreement or any other matter
or controversy may shall be determined by arbitration in accordance with
the rules of the Commercial Arbitration Rules of the American Arbitration
Association in Atlanta, Georgia.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day month and year first before written.
HARBINGER: EQUITY:
HARBINGER CORPORATION AXA EQUITY & LAW LIFE ASSURANCE SOCIETY,
LTD.
By: /s/ Joel G. Katz By: /s/ Anthony R. Arnold
------------------------------ -------------------------------------
Name: JOEL G. KATZ Name: ANTHONY R. ARNOLD
----------------------------- -----------------------------------
Title: Vice President Title: Assoc. Director
---------------------------- ----------------------------------
Address:1055 Lenox Park Blvd. Address:20 Lincoln's Inn Fields
-------------------------- --------------------------------
Atlanta, GA 30319 London, United Kingdom, WC2A 3ES
-------------------------- --------------------------------
-------------------------- --------------------------------
VULCAN: COMPANY:
VULCAN VENTURES, INC. HARBINGER NV
By: /s/ William D. Savoy By: /s/ Theodore Ciochon
------------------------------- -------------------------------------
Name: WILLIAM D. SAVOY Name: THEODORE CIOCHON
----------------------------- -----------------------------------
Title: Vice President Title: Managing Director
---------------------------- ----------------------------------
Address:110 110th Ave, NE Address:Antareslaan 27
-------------------------- --------------------------------
Ste. 550 2132 JE Hoofddorp,
-------------------------- --------------------------------
Bellevue, WA 98004 The Netherlands
-------------------------- --------------------------------
13
<PAGE> 11
AGREEMENT AND PLAN OF REORGANIZATION
EXHIBIT TABLE
<TABLE>
<S> <C> <C>
Exhibit A Share Transfer Table
Exhibit B * Capitalization Table
Exhibit C * Harbinger Corporation 10-K Fiscal Year ended December 31, 1995
Exhibit D Description of Harbinger Capital Stock
Exhibit E * Proxy Statement
Exhibit F * Harbinger Corporation Annual Report Fiscal Year Ended December 31, 1995
Exhibit G * Registration rights
</TABLE>
* Denotes exhibits not filed with this 8-K dated May 3, 1996. Harbinger
Corporation agrees to furnish supplementally a copy of the omitted schedules to
the Securities and Exchange Commission upon request.
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<PAGE> 12
EXHIBIT A
SHARE TRANSFER TABLE
<TABLE>
<CAPTION>
OTHER SHAREHOLDER COMPANY SHARES TRANSFERRED HARBINGER SHARES RECEIVED
<S> <C> <C>
Vulcan Ventures, Inc. 1,950,000 29,032
AXA Equity & Law Life
Assurance Company, Ltd. 650,000 9,677
</TABLE>
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<PAGE> 13
EXHIBIT D
DESCRIPTION OF HARBINGER CORPORATION
CAPITAL STOCK
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of Harbinger Corporation, a corporation
organized under the laws of the State of Georgia (the "Company") consists of
100,000,000 shares of Common Stock, par value $.0001 per share and 20,000,000
shares of Preferred Stock, of which 4,000,000 shares have been designated
Redeemable Zero Coupon Preferred Stock, $.0001 par value per share. The
following summary is qualified in its entirety by reference to the Company's
Amended and Restated Articles of Incorporation, as amended, (the ''Articles''),
and by the provisions of applicable law.
COMMON STOCK
As of April 4, 1996, there were 10,475,335 shares of Common Stock
outstanding, held of record by approximately 173 shareholders. Holders of
Common Stock are entitled to one vote for each share held on all matters
submitted to a vote of shareholders and do not have cumulative voting rights.
Accordingly, holders of a majority of the shares of Common Stock entitled to
vote in any election of directors may elect all of the directors standing for
election. Holders of Common Stock are entitled to receive ratably such
dividends, if any, as may be declared by the Board of Directors out of funds
legally available therefor, subject to any preferential dividend rights of
outstanding preferred stock. Upon the liquidation, dissolution or winding up of
the Company, the holders of Common Stock are entitled to receive ratably the
net assets of the Company available after the payment of all debts and other
liabilities and subject to the prior rights of any outstanding preferred stock.
Holders of Common Stock, as such, have no preemptive, subscription, redemption
or conversion rights. The outstanding shares of Common Stock are, and the
shares offered by the Company in this offering will be, when issued and paid
for, fully paid and nonassessable. The rights, preferences and privileges of
holders of Common Stock are subject to, and may be adversely affected by, the
rights of the holders of shares of any series of preferred stock which the
Company may designate and issue from time to time in the future.
PREFERRED STOCK
The Board of Directors is authorized, subject to certain limitations
prescribed by law, without further shareholder approval, to issue from time to
time up to an aggregate of 20,000,000 shares of preferred stock in one or more
series and to fix or alter the designations, preferences, rights and any
qualifications, limitations or restrictions on the shares of each such
series thereof, including the dividend rights, dividend rates, conversion
rights, voting rights,
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<PAGE> 14
terms of redemption (including sinking fund provisions), redemption price or
prices, liquidation preferences and the number of shares constituting any series
or designations of such series. The issuance of preferred stock may have the
effect of delaying, deferring or preventing a change of control of the Company.
4,000,000 shares of Preferred Stock are presently outstanding and are designated
Zero Coupon Preferred Stock. All holders of the Company's Series A Preferred
Stock converted their shares into Common Stock of the Company in December 1993,
resulting in the issuance of 360,361 shares of Common Stock. The holders of the
Company's Series B Preferred Stock redeemed their stock at the time of the
Company's Initial Public Offering, in exchange for cash payment by the Company.
All holders of the Company's Series C Preferred Stock converted their shares
into Common Stock of the Company in March 1996, resulting in the issuance of
140,692 shares of Common Stock. There are no authorized or outstanding shares of
Series A Preferred Stock, Series B Preferred Stock or Series C Preferred Stock.
Zero Coupon Preferred Stock. Holders of shares of the Zero Coupon
Preferred Stock have no voting rights and are not entitled to dividends. Vested
shares of Zero Coupon Preferred Stock have preference over holders of shares of
Common Stock, upon the Company's dissolution. The Company and SSA are parties
to an Alliance Agreement by which they have defined targeted royalties for each
Vesting Year. Following each Vesting Year, (i) up to 1,000,000 shares of Zero
Coupon Preferred Stock will be eligible to vest; (ii) the number of shares that
actually vest with respect to such Vesting Year will be an amount (not to
exceed 1,000,000) determined by multiplying 1,000,000 times a fraction (1) the
numerator of which shall be the amount determined by subtracting 80% from the
percentage (up to 100%) of targeted royalties actually earned, and (2) the
denominator of which shall be 20%; (iii) the Company will redeem the vested
shares; and (iv) the eligible shares that do not vest will be forfeited. The
redemption price, at SSA's discretion, either will be cash in the amount of
$1.00 per share for each share of vested Zero Coupon Preferred Stock redeemed,
or issuance to SSA of a number of shares of Harbinger's Common Stock equal to
the Zero Coupon Preferred Stock issue price of $1.00 per share for all vested
shares, divided by the then current fair market value of Harbinger's Common
Stock (determined as the closing bid price for shares of Common Stock at the
close of business on December 31 of such Vesting Year).
CERTAIN CHARTER AND BYLAW PROVISIONS
Shareholders' rights and related matters are governed by the Georgia
Business Corporation Code and the Company's Articles and its Amended and
Restated Bylaws (the "Bylaws"). Certain provisions of the Articles and
Bylaws, which are summarized below, could, either alone or in combination with
each other, have the effect of preventing a change in control of the Company or
making changes in management more difficult.
Corporate Takeover Provisions. The Company's Bylaws made applicable to
the Company provisions authorized by the Georgia Business Corporation Code
relating to business combinations with interested shareholders ("Corporate
Takeover Provisions"). The Corporate Takeover Provisions are designed to
encourage any person, before acquiring 10% of the Company's voting shares, to
seek approval of the Board of Directors for the terms of any
17
<PAGE> 15
contemplated business combination. The Corporate Takeover Provisions will
prevent for five years certain business combinations with an "interested
shareholder" (as defined in the Corporate Takeover Provisions) unless (i) prior
to the time such shareholder became an interested shareholder, the Board of
Directors approved either the business combination or the transaction that
resulted in the shareholder becoming an interested shareholder, (ii) in the
transaction that resulted in the shareholder becoming an interested shareholder,
the interested shareholder became the beneficial owner of at least 90% of the
outstanding voting shares of the Company excluding, however, shares owned by the
Company's officers, directors, affiliates, subsidiaries and certain employee
stock plans or (iii) subsequent to becoming an interested shareholder, such
shareholder acquired additional shares resulting in the interested shareholder
becoming the owner of at least 90% of the Company's outstanding voting shares
and the business combination is approved by the holders of majority of the
Company's voting shares, excluding from said vote the stock owned by the
interested shareholder or by the Company's officers, directors, affiliates,
subsidiaries and certain employee stock plans.
Shareholders of the Company who became interested shareholders prior to
the time of the adoption of the Corporate Takeover Provisions are not subject
to such provisions.
Commencing with the 1996 annual meeting of shareholders, the Board of
Directors will be divided into three classes, as nearly equal in size as
possible, with staggered three-year terms. One class is elected each year. The
classification of the Board of Directors could have the effect of making it
more difficult for a third party to acquire control of the Company.
Constituency Considerations. The Company's Articles provide for the
right of the Board of Directors to consider the interests of various
constituencies, including employees, customers, suppliers and creditors of the
Company, as well as the communities in which the Company is located, in
addition to the interest of the Company and its shareholders, in discharging
their duties in determining what is in the Company's best interests.
Limitation of Directors' Liability. The Company's Articles eliminate,
subject to certain exceptions, the personal liability of directors to the
Company or its shareholders for monetary damages for breaches of such
directors' duty of care or other duties as a director. The Articles do not
provide for the elimination of or any limitation on the personal liability of a
director for (i) any appropriation, in violation of the director's duties, of
any business opportunity of the Company, (ii) acts or omissions that involve
intentional misconduct or a knowing violation of law, (iii) unlawful corporate
distributions or (iv) any transaction from which the director received an
improper benefit. In addition, the Company's Bylaws provide broad
indemnification rights to directors and officers so long as the director or
officer acted in a manner believed in good faith to be in or not opposed to the
best interest of the Company, and with respect to criminal proceedings, if the
director has no reasonable cause to believe his or her conduct was unlawful.
These provisions of the Articles and Bylaws will limit the remedies available
to a shareholder who is dissatisfied with a Board decision protected by these
provisions.
The Articles provide that the affirmative vote of holders of at least 75%
of shares of Common Stock entitled to vote generally in the election of
directors, voting as a single voting
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<PAGE> 16
group, is required to alter or amend the provisions of the Articles providing
for a staggered board of directors, or to alter or amend the following
provisions of the Bylaws: indemnification of officers and directors, the vote
required to amend the Bylaws, fair price provisions, business combinations with
interested shareholders, special meetings of shareholders, the number of the
Company's directors, removal of directors, and who may fill vacancies within the
board of directors.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Common Stock is First Union
National Bank, Charlotte, North Carolina.
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<PAGE> 17
EXHIBIT G
REGISTRATION RIGHTS
The Other Shareholders shall have registration rights with respect to the
Harbinger Shares as set forth below:
A. DEFINITIONS. As used hereinafter, the following terms shall have the
following respective meanings:
"Commission" shall mean the United States Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
"Holder" shall mean any person owning or having the right to acquire
Registrable Securities, including any such person to whom the rights granted
hereunder have been transferred in accordance with Section H. hereof.
"Participating Holders" shall mean all Holders whose Registrable
Securities held by them be included in any registration, qualification or
compliance pursuant to Section B. hereof .
The terms "register," "registered," and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement .
"Registrable Securities" shall mean the Harbinger Shares; provided,
however, that the Harbinger Shares or other securities shall only be treated as
Registrable Securities if and for so long as they have not been (A) sold to or
through a broker or dealer or underwriter in a public distribution or a public
securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Section 4(1) thereof so that all transfer restrictions, and restrictive legends
with respect thereto, if any, are removed upon the consummation of such sale.
The number of shares of "Registrable Securities then outstanding" shall be the
number of shares of Harbinger Shares issued and outstanding which are
Registrable Securities.
"Registration Expenses" shall mean all expenses incurred by Harbinger in
complying with Sections B. and C. hereof, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for Harbinger, blue sky fees and expenses,
and the expense of any special audits incident to or required by any such
registration (but excluding the compensation of regular employees of Harbinger
which shall be paid in any event by Harbinger).
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions, and stock transfer taxes applicable to the securities registered
by the Holders and all fees and disbursements of counsel for the Holders.
B. PIGGY-BACK REGISTRATION RIGHTS. If Harbinger, at any time proposes to
register any of its securities under the Securities Act in order to consummate
a public offering of any of its securities in the form of an underwritten
offering, Harbinger shall request that the managing underwriter of such written
offering include the Registrable Securities in such registration. If such
managing underwriter agrees to include any of the
20
<PAGE> 18
Registrable Securities in such underwritten offering, Harbinger shall at such
time give prompt notice to the Holders specifying the form and manner and other
relative facts involved in such proposed registration, and upon the written
request of any Holder delivered to Harbinger within twenty (20) days of giving
of such notice (which request shall specify that the Registrable Securities held
by such Holder be included in such registration), Harbinger shall include such
Registrable Securities held by each such Holder requested to be included in such
registration; provided, however, that
i. If, at any time after giving such written notice of its
intention to register any of its securities and prior to the effective date of
the registration statement filed in connection with such registration, Harbinger
shall determine for any reason not to register such securities, at its sole
election, Harbinger may give written notice of such determination to each Holder
and thereupon shall be relieved of its obligation to register any Registrable
Securities; and
ii. If the managing underwriter in such underwritten offering shall
advise Harbinger that it declines to include a portion or all of the Registrable
Securities requested by the Holders to be included in the registration
statement, then distribution of all or one specified portion of the Registrable
Securities shall be excluded from such registration statement (in the case of an
exclusion as to a portion of such Registrable Securities, such portion to be
allocated among such Holders in proportion to the respective number of
Registrable Securities requested to be registered by such Holders). In such
event, Harbinger shall give the Holders prompt notice of the number of shares
excluded.
C. HARBINGER OBLIGATIONS. At its expense, Harbinger will use its best
efforts to:
(1) Keep any registration statement filed pursuant hereto effective
for a period of ninety (90) days or until the Holders have completed the
distribution described in the registration statement relating thereto, whichever
first occurs; provided, however, that such 90-day period shall be extended for a
period of time equal to the period the Holders refrain from selling any
securities included in such registration at the request of an underwriter of
common stock (or other securities) of Harbinger;
(2) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such registration statement;
(3) Furnish such number of prospectuses and other documents incident
thereto, including any amendment of or supplement to the prospectus, as the
Holders from time to time may reasonably request;
(4) Notify the Holders at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or incomplete in the light of the
circumstances then existing, and at the request of any such seller, prepare and
furnish to such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading or
incomplete in the light of the circumstances then existing;
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<PAGE> 19
(5) Cause all such Registrable Securities registered pursuant
hereunder to be listed on the national securities exchange on which Harbinger's
common stock is then listed; and
(6) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant to such registration statement and a CUSIP number
for all such Registrable Securities, in each case not later than the effective
date of such registration.
D. COSTS AND EXPENSES. The Holders agree to pay all of the underwriting
discounts and commissions, transfer taxes, and their own counsel fees with
respect to the securities owned by them being registered. Harbinger will pay
all other costs and expenses in connection with such registration statement
including, without limitation, the fees and expenses of counsel for Harbinger,
the fees and expenses of its accountants and all other costs and expenses
incident to the preparation, printing and filing under the Securities Act of
any such registration statement, each prospectus and all amendments and
supplements thereto, the costs incurred in connection with the qualification of
such securities for sale in such reasonable number of states as the Holders
have designated, including fees and disbursements of counsel for the Holders,
and the costs of supplying a reasonable number of copies of the registration
statement, each preliminary prospectus, final prospectus and any supplements or
amendments thereto to the Holders.
E. HARBINGER INDEMNIFICATION. Harbinger will indemnify the Holders, each of
their officers, directors and partners, and each person controlling the Holders
within the meaning of Section 15 of the Securities Act, with respect to which
registration, qualification or compliance has been effected pursuant hereto,
and each underwriter, if any, and each person who controls any underwriter
within the meaning of Section 15 of the Securities Act (the "Harbinger
Indemnitees"), against all expenses, claims, losses, damages or liabilities (or
actions in respect thereof), including any of the foregoing incurred in
settlement of any litigation, commenced or threatened, arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any registration statement, prospectus, offering circular or other
document, or any amendment or supplement thereto, incident to any such
registration, qualification or compliance; or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading; or based on any violation (or alleged
violation) by Harbinger of any provision of the Securities Act, or any rule or
regulation promulgated under the Securities Act, applicable to Harbinger in
connection with any such registration, qualification or compliance.
F. HOLDERS INDEMNIFICATION. The Holders will, if Registrable Securities held
by the Holders are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify Harbinger, each of its
directors and officers, each underwriter, if any, of Harbinger's securities
covered by such a registration statement, each person who controls Harbinger or
such underwriter within the meaning of Section 15 of the Securities Act,
against all claims, losses, damages and liabilities (or actions in respect
thereof) arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any such registration statement,
prospectus, offering circular or other document; or based on any omission (or
alleged omission) to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but only to
the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to Harbinger by the Holders.
G. CONTRIBUTION. If the indemnification provided for herein is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage, or expense referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage, or expense as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party and the parties' relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.
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<PAGE> 20
H. UNDERWRITING AGREEMENT TO CONTROL. Notwithstanding the foregoing, to the
extent that the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with any underwritten public
offering are in conflict with the foregoing provisions, the provisions in such
underwriting agreement shall control.
I. SURVIVAL. The obligations of Harbinger and the Holders hereunder shall
survive the completion of any offering of Registrable Securities in a
registration statement hereunder or otherwise.
J. NO OBLIGATION TO REGISTER SECURITIES WHICH MAY BE SOLD PURSUANT TO RULE
144. Harbinger shall have no obligation to register any Registrable Securities
which shall be eligible for sale to the public pursuant to Rule 144 or any
other applicable statute, rule or regulation governing the resale of restricted
securities.
K. HARBINGER MAY GRANT REGISTRATION RIGHTS TO OTHER SHAREHOLDERS. Nothing
herein shall be deemed to prohibit Harbinger from granting registration rights
with respect to any of the shares of Harbinger to any other holder of
Harbinger's securities.
L. HOLDERS AGREEMENT TO ENTER INTO LOCK-UP AGREEMENT. In the event that
Harbinger at any time shall propose to register shares of its common stock for
sale to the public, the Holders agree to enter into an agreement with the
underwriter of such offering, on such terms and conditions as such underwriter
shall request, whereby the Holders shall agree to refrain from making any
offer, sale, transfer, gift or other disposition of shares of Harbinger's
common stock in the United States for a period of up to 180 days following the
effective date of such registration statement.
23
