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Agreement and Plan of Reorganization

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Sectors: Services
Governing Law: Georgia, View Georgia State Laws
Effective Date: July 29, 1997
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AGREEMENT AND PLAN OF REORGANIZATION
BETWEEN
ACCESS BEYOND, INC.
AND
HAYES MICROCOMPUTER PRODUCTS, INC.


July 29, 1997


TABLE OF CONTENTS
Page
----


I. PLAN OF REORGANIZATION ................................................2
1.1 The Merger.......................................................2
1.2 Fractional Shares................................................3
1.3 Hayes Options and Warrants.......................................4
1.4 Effects of the Merger............................................4
1.5 Tax-Free Reorganization..........................................6
1.6 Purchase Accounting Treatment....................................6
1.7 Charter Amendments ..............................................6


2. REPRESENTATIONS AND WARRANTIES OF HAYES................................6
2.1 Organization and Good Standing...................................6
2.2 Subsidiaries.....................................................7
2.3 Power, Authorization and Validity................................7
2.4 Capitalization...................................................8
2.5 No Conflict or Violation.........................................9
2.6 Litigation.......................................................9
2.7 Hayes Financial Statements.......................................9
2.8 Taxes...........................................................10
2.9 Title to Properties.............................................10
2.10 Absence of Certain Changes......................................11
2.11 Agreements and Commitments......................................12
2.12 Intellectual Property...........................................13
2.13 Compliance with Laws............................................14
2.14 Certain Transactions and Agreements.............................14
2.15 Employees.......................................................15
2.16 Corporate Documents.............................................16
2.17 Books and Records...............................................17
2.18 Insurance.......................................................17
2.19 Environmental Matters ..........................................17
2.20 Government Contracts............................................17
2.21 No Brokers......................................................18
2.22 Information Supplied............................................18
2.23 Interested Party Transactions...................................18
2.24 Real Property Holding Corporation Status .......................19
2.25 Disclosure......................................................19


3. REPRESENTATIONS AND WARRANTIES OF ACCESS BEYOND.......................19
3.1 Organization and Good Standing..................................19
3.2 Subsidiaries....................................................19
3.3 Power, Authorization and Validity...............................20


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3.4 Capitalization..................................................20
3.5 No Conflict or Violation........................................21
3.6 Litigation......................................................21
3.7 Access Beyond Financial Statements..............................22
3.8 Taxes...........................................................22
3.9 Title to Properties.............................................23
3.10 Absence of Certain Changes......................................23
3.11 Agreements and Commitments......................................25
3.12 Intellectual Property...........................................26
3.13 Compliance with Laws............................................27
3.14 Certain Transactions and Agreements.............................27
3.15 Employees.......................................................27
3.16 Corporate Documents.............................................28
3.17 Books and Records...............................................29
3.18 Insurance.......................................................29
3.19 Environmental Matters...........................................29
3.20 Government Contracts............................................29
3.21 Remote Access Products .........................................31
3.22 No Brokers......................................................31
3.23 Information Supplied............................................31
3.24 Interested Party Transactions...................................31
3.25 Disclosure......................................................31
3.26 SEC Filings ....................................................32


4. COVENANTS OF THE PARTIES..............................................32
4.1 Access; Advice of Changes.......................................32
4.2 Notification of Changes in Relationships........................33
4.3 Conduct of Business.............................................33
4.4 No Solicitation.................................................35
4.5 Registration on Form S-4........................................36
4.6 Regulatory Approvals............................................37
4.7 Stockholders Meetings...........................................38
4.8 Indemnification of Officers and Directors.......................39
4.9 Confidentiality.................................................40
4.10 Confidentiality and Disclosure..................................40
4.11 Affiliates Agreements...........................................40
4.12 New Capital Funding ............................................41
4.13 Other Actions Required..........................................41


5.41 HAYES PRECLOSING COVENANTS............................................41
5.1 Business Plan...................................................41
5.2 Hayes Dissenting Shares.........................................42
5.3 Other Actions Required .........................................42


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6. CLOSING MATTERS.......................................................42
6.1 The Closing.....................................................42
6.2 Exchange of Certificates........................................43
6.3 Assumption of Options and Warrants..............................43
6.4 Access Beyond Options ..........................................44


7. CONDITIONS TO OBLIGATIONS OF HAYES....................................44
7.1 Removal of Due Diligence and Other Conditions ..................44
7.2 Covenants, Representations and Warranties.......................44
7.3 Compliance with Law.............................................45
7.4 Government Consents.............................................45
7.5 Form S-4........................................................45
7.6 Documents and Consents..........................................45
7.7 Hart-Scott Rodino Compliance....................................45
7.8 No Litigation...................................................45
7.9 Opinion of Counsel..............................................45
7.10 Employment Agreements...........................................46
7.11 Tax-Free Transaction ...........................................46
7.12 Listing.........................................................46
7.13 Access Beyond Amended and Restated Certificate..................46
7.14 Satisfactory Form of Legal and Accounting Matters...............46
7.15 Access Beyond Board of Directors................................46
7.16 Resignations ...................................................46
7.17 Shareholders Agreement .........................................46


8. CONDITIONS TO OBLIGATIONS OF ACCESS BEYOND............................47
8.1 Removal of Due Diligence and Other Conditions...................47
8.2 Covenants, Representations and Warranties.......................47
8.3 Compliance with Law.............................................47
8.4 Government Consents.............................................47
8.5 Form S-4........................................................48
8.6 Hart-Scott-Rodino Compliance....................................48
8.7 Documents and Consents..........................................48
8.8 No Litigation...................................................48
8.9 Opinion of Counsel..............................................48
8.10 Employment Agreements...........................................48
8.11 Listing.........................................................48
8.12 Affiliate Agreements............................................48
8.13 Satisfactory Form of Legal and Accounting Matters...............49
8.14 Completion of other Actions.....................................49
8.15 Access Beyond Restated Certificate..............................49
8.16 Fairness Opinion................................................49
8.17 Access Beyond Board of Directors................................49


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9. TERMINATION OF AGREEMENT..............................................49
9.1 Termination.....................................................49
9.2 Effect of Termination...........................................51
9.3 Expenses; Termination Fees......................................52


10. SURVIVAL OF REPRESENTATIONS, CONTINUING COVENANTS......................53


11. GENERAL PROVISIONS....................................................53
11.1 Governing Law; Dispute Resolution...............................53
11.2 Assignment; Binding Upon Successors and Assigns.................54
11.3 Severability....................................................54
11.4 Counterparts....................................................55
11.5 Other Remedies..................................................55
11.6 Amendment and Waivers...........................................55
11.7 No Waiver.......................................................55
11.8 Notices.........................................................55
11.9 Construction of Agreement.......................................57
11.10 No Joint Venture................................................57
11.11 Further Assurances..............................................57
11.12 Absence of Third Party Beneficiary Rights.......................57
11.13 Time is of the Essence..........................................57
11.14 Entire Agreement................................................57


Exhibits:


Exhibit A Form of Certificate of Merger
Exhibit C-1 Form of Voting Agreement
Exhibit C-2 Form of Market Standoff Agreement
Exhibit C-3 Form of Hayes Affiliates Agreement
Exhibit C-4 Form of Employment Agreement for Ronald A. Howard
Exhibit C-5 Form of Employment Agreement for Dennis C. Hayes
Exhibit 1.5A Certificate of Officer as to Tax Matters
(Access Beyond and Newco)
Exhibit 1.5B Certificate of Officer as to Tax Matters (Hayes)
Exhibit 7.13 Form of Restated Certificate


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AGREEMENT AND PLAN OF REORGANIZATION


This Agreement and Plan of Reorganization (this "Agreement") is entered into as of July 29, 1997, by and between Access Beyond, Inc., a Delaware corporation ("Access Beyond"), and Hayes Microcomputer Products, Inc., a Georgia corporation ("Hayes") (and individually referred to as "Party" and jointly and severally referred to herein as "Parties").


A. The Parties intend that, subject to the terms and conditions set forth herein, a new corporation that will be organized in Georgia as a wholly owned subsidiary of Access Beyond ("Newco") will merge with and into Hayes in a reverse triangular merger (the "Merger"), with Hayes to be the surviving corporation of the Merger, all pursuant to the terms and conditions of this Agreement and Certificate of Merger substantially in the form of Exhibit A (the "Certificate of Merger") and the applicable provisions of the laws of Georgia.


B. Upon the effectiveness of the Merger, all the outstanding capital stock of Hayes will be converted into capital stock of Access Beyond, and Access Beyond will assume all outstanding options and warrants to purchase shares of Hayes capital stock, in the manner and on the basis determined herein and as provided in the Certificate of Merger.


C. The Merger is intended to be treated as a "purchase" for accounting purposes and a tax-free reorganization pursuant to the provisions of Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the "Code"), by virtue of the provisions of Section 368(a)(2)(E) of the Code.


D. Concurrent with the execution and delivery of this Agreement:


(i) Dennis C. Hayes, Chestnut Capital, LLC, Rinzai Limited and Vulcan Ventures Incorporated, who together hold a majority or more of the issued and outstanding shares of each class or series of Hayes capital stock, and a sufficient number of shares of Hayes capital stock to approve the Merger (the "Principal Hayes Shareholders"), are each executing and delivering to Access Beyond a fully signed copy of a certain Voting Agreement substantially in the form of Exhibit C-1 containing a market standoff agreement, an agreement to vote in favor of the Merger, this Agreement, the Certificate of Merger and the transactions provided for herein and against any transaction that could adversely affect the Merger (collectively, the "Voting Agreements");


(ii) certain other shareholders of Hayes are entering into a "Market Standoff Agreement" in substantially the form attached hereto as Exhibit C-2;


(iii) the Principal Hayes Shareholders and any other shareholder of Hayes who is an "affiliate" of Hayes within the meaning of Rule 145 promulgated by the Securities and Exchange Commission under the Securities Act of 1933, as amended, and the key corporate officers and directors of Hayes by the end of the Due Diligence Period will be entering into the "Hayes Affiliates Agreements" substantially in the form of Exhibit C-3 hereto;


(iv) the shareholders of Hayes and Ronald A. Howard are entering into a Shareholders' Agreement to be effective at the Effective Time (the "Shareholders' Agreement"); and


(v) Ronald A. Howard and Dennis C. Hayes are entering into an Employment Agreement or an amendment to Employment Agreement with Access Beyond substantially in the form of Exhibits C-4 and C-5 hereto, respectively (the "Employment Agreements").


The Parties acknowledge that in the event that the transactions contemplated by this Agreement are not consummated, each Party would experience a substantial loss and hardship; therefore, to minimize the potential for such (i) failure to consummate the transactions and (ii) loss and hardship, the Parties have knowingly agreed not to include in this Agreement many otherwise normal conditions to closing the Merger, including but not limited to, a condition that there shall be no material adverse change prior to the Effective Time (as defined below) to either Party, its business, financial condition, results of operations or prospects, or to either Party's industry or to general business conditions.


Now, therefore, in reliance upon the recitals set forth above, the Parties hereto agree as follows:


I. PLAN OF REORGANIZATION.


1.1 The Merger. Subject to the terms and conditions of this Agreement, prior to the Closing Date (as defined in Section 6.1 below), Access Beyond will incorporate and organize Newco and will cause the Board of Directors and shareholders of Newco to approve the Merger and become a party to this Agreement which is obligated to perform all of the duties of Newco set forth in this Agreement. Subject to the terms and conditions of this Agreement, the Certificate of Merger will be filed with the Secretary of State of the State of Georgia on the Closing Date. The date and time that the Certificate of Merger is filed with the Georgia Secretary of State and the Merger thereby becomes effective will be referred to in this Agreement as the "Effective Time." Subject to the terms and conditions of this Agreement and the Certificate of Merger, Newco will be merged with and into Hayes in a statutory merger pursuant to the Certificate of Merger and in accordance with applicable provisions of Georgia law as follows.


1.1.1 Creation of Series A Stock. Prior to the Effective Time, Access Beyond will have amended its Certificate of Incorporation to create the Series A Preferred Stock of Access Beyond (the "Access Beyond Series A Stock"), each share of which shall initially be convertible into one share of Access Beyond Common Stock, $0.01 par value ("Access Beyond Common Stock") and shall have the rights, preferences, privileges and restrictions as are specified in the form of Restated Certificate of Incorporation attached hereto as Exhibit 7.13.


1.1.2 Conversion of Hayes Common Stock. Each share of Hayes Common Stock, $0.01 par value (the "Hayes Common Stock") that is issued and outstanding immediately


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prior to the Effective Time (other than shares, if any, for which dissenters rights are perfected in compliance with applicable law), will, by virtue of the Merger and at the Effective Time and without further action on the part of any holder thereof, be converted into the right to receive that number of fully paid and nonassessable shares of Access Beyond Common Stock, that is equal to the Conversion Ratio.


1.1.3 Conversion of Hayes Series A Stock. Each share of Hayes Series A Preferred Stock, no par value (the "Hayes Series A Stock"), that is issued and outstanding immediately prior to the Effective Time (other than shares, if any, for which dissenters rights are perfected in compliance with applicable law), will, by virtue of the Merger and at the Effective Time and without further action on the part of any holder thereof, be converted into the right to receive that number of fully paid and nonassessable shares of Access Beyond Common Stock that is equal to the Conversion Ratio multiplied by the number of shares of Hayes Common Stock into which such share of Hayes Series A Stock is then convertible.


1.1.4 Conversion of Hayes Series B Stock. Each share of Hayes Series B Preferred Stock, no par value (the "Hayes Series B Stock"), that is issued and outstanding immediately prior to the Effective Time (other than shares, if any, for which dissenters rights are perfected in compliance with applicable law), will, by virtue of the Merger and at the Effective Time and without further action on the part of any holder thereof, be converted into the right to receive that number of fully paid and nonassessable shares of Access Beyond Series A Stock that is equal to the Conversion Ratio multiplied by the number of shares of Hayes Common Stock into which such share of Hayes Series B Stock is then convertible.


1.1.5 Conversion Ratio Defined. For purposes of this Agreement, the "Conversion Ratio" shall be determined as follows,


First, take the percentage ownership immediately after Closing of the issued and outstanding shares of Access Beyond Common Stock and Access Beyond Series A Stock that the holders of all classes of Hayes Common, Series A Preferred Stock and Series B Preferred Stock in the aggregate are entitled to receive as a result of and immediately following the Merger, which the Parties hereby agree is seventy-nine percent (79%) (the "Hayes Percentage").


Next, calculate the "Conversion Ratio" according to the following formula:


Conversion Ratio = [ B ( C OVER 1.0 - B ) ] / D


Where: B = .79 (the "Hayes Percentage")


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C = The number of shares of Access Beyond common and preferred
stock issued and outstanding on a fully diluted basis
(excluding all issued and outstanding Access Beyond stock
options) immediately prior to the Effective Time


D = The number of shares of Hayes common and preferred stock
issued and outstanding on a fully diluted basis immediately
prior to the Effective Time, excluding all issued and
outstanding Hayes stock options and warrants in accordance
with Sections 2.4.2 and 5.4 hereof


Thus, for example only, assuming that the number of fully diluted shares of Access Beyond common and preferred stock (excluding shares issuable upon exercise of Access Beyond stock options) outstanding immediately prior to the Effective Time, or "C," equals 12,500,000 and that the number of fully diluted shares of Hayes common and preferred stock outstanding (excluding shares issuable upon exercise of Hayes stock options and warrants) immediately prior to the Effective Time, or "D," equals 10,000,000, then the Conversion Ratio would be 4.702381.


1.1.6 Dissenting Shares. Holders of Hayes Common Stock, Hayes Series A Stock and/or Hayes Series B Stock (the "Hayes Stock") who have complied with all requirements for perfecting shareholders' rights of appraisal, if any, as set forth in Section 14-2-1301 et seq. of the Georgia Business Corporation Code ("Georgia Law"), shall be entitled to their rights under the Georgia Law, if any, with respect to such shares ("Dissenting Shares") and not to any portion of the Access Beyond Common Stock or Access Beyond Series A Stock receivable by the shareholders of Hayes by reason of the Merger.


1.1.7 Conversion of Newco Shares. Each share of Newco Common Stock, par value $0.01 ("Newco Common Stock"), that is issued and outstanding immediately prior to the Effective Time will, by virtue of the Merger and without further action on the part of the sole shareholder of Newco, be converted into and become one share of Hayes Common Stock that is to be issued and outstanding immediately after the Effective Time, and the share of Hayes Common Stock into which the shares of Newco Common Stock are so converted shall be the only share of Hayes Stock that is issued and outstanding immediately after the Effective Time.


1.2 Fractional Shares. No fractional shares of Access Beyond Common Stock or Access Beyond Series A Stock (the "Access Beyond Stock") will be issued in connection with the Merger, but in lieu thereof, the record holder of any shares of Hayes Stock who would otherwise be entitled to receive a fraction of a share of Access Beyond Stock, upon aggregation of all shares and fractional shares owned by such holder, will receive from Access Beyond, promptly after the Effective Time, without interest, an amount of cash equal to the per share market value of Access Beyond Stock (based on the closing sale price of Access Beyond Common Stock on the last trading day prior to the Closing Date, as quoted on the Nasdaq National Market and reported in the Western Edition of The Wall Street Journal) multiplied by the fraction of a share of Access Beyond Stock to which such holder would otherwise be entitled.


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1.3 Hayes Options and Warrants.


1.3.1 Assumption of Options and Warrants. At the Effective Time, each outstanding option (collectively, the "Hayes Options") to purchase Hayes Common Stock granted under Hayes' Stock Option Plan, as amended (the "Hayes Plan"), and each warrant for the purchase of Hayes Stock (the "Hayes Warrants") shall be assumed by Access Beyond in accordance with the terms of such option or warrant, and converted into rights with respect to that number of shares of Access Beyond Common Stock, determined by multiplying the number of shares of Hayes Stock subject to such Hayes Option or Hayes Warrant (on an as if exercised basis) immediately prior to the Effective Time by the Conversion Ratio, and the exercise price per share for each such option or warrant will equal the exercise price of the Hayes Option or the Hayes Warrant immediately prior to the Effective Time divided by the Conversion Ratio (rounded up to the nearest whole cent). If the foregoing calculation results in an assumed option or warrant being exercisable for a fraction of a share, then the number of shares of Access Beyond Common Stock subject to such option or warrant will be rounded down to the nearest whole number with no cash being payable for such fractional share.


1.3.2 Terms of Assumed Options and Warrants. Access Beyond will administer the Hayes Plan assumed pursuant to this Section 1.3 in a manner that complies with Rule 16b-3 promulgated by the SEC under the Securities Exchange Act of 1934 ("Exchange Act"). Continuous employment with Hayes will be credited to an optionee for purposes of determining the number of shares subject to exercise after the Effective Time. The term, exercisability, vesting schedule, status as an "incentive stock option" under Section 422 of the Code, if applicable, and all other terms of the Hayes Options and Hayes Warrants will otherwise be unchanged. Access Beyond will cause the Access Beyond Common Stock issued upon exercise of the assumed Hayes Options and Hayes Warrants (to the extent that such Hayes Warrants were issued in a compensatory transaction and are otherwise eligible to be registered on Form S-8) together with the Access Beyond stock option plans in effect after the Effective Time, to the extent same qualify for such registration and have not previously been registered, to be registered on Form S-8 of the Securities and Exchange Commission ("SEC") within 90 days after the Effective Time, will exercise reasonably diligent efforts to maintain the effectiveness of such registration statement for so long as such assumed Hayes Options and such eligible Hayes Warrants remain outstanding and will reserve a sufficient number of shares of Access Beyond Common Stock for issuance upon exercise of the assumed Hayes Options and Hayes Warrants.


1.4 Effects of the Merger. At the Effective Time: (a) the separate existence of Newco will cease and Newco will be merged with and into Hayes and Hayes will be the surviving corporation pursuant to the terms of the Certificate of Merger; (b) the Articles of Incorporation and Bylaws of Hayes will remain the Articles of Incorporation and Bylaws of the surviving corporation; (c) each share of Newco Common Stock outstanding immediately prior to the Effective Time will be converted into one outstanding share of Hayes Common Stock; (d) the directors of Hayes to be in effect subsequent to the Effective Time will be the directors of Hayes as the surviving corporation and the officers of Hayes will remain the officers of Hayes as the


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surviving corporation; (e) ea
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