EXHIBIT (d) (3)
December 11, 2001
SDL plc
Xxxxxx Xxxxx
Xxxxxx Xxxxxx
Xxxxxxxxxx
XX0 0XX
Xxxxxx Xxxxxxx
Re: Stockholder Agreement
Dear Sirs:
Each of the undersigned (the "Stockholder") understands that SDL plc, a
company organized under the laws of England and Wales ("SDL") is considering an
acquisition of all or substantially all of the outstanding capital stock of
ALPNET, Inc. pursuant to which the holders of Common Stock of the Company
receive in the aggregate at least $6,500,000 in cash (the "Acquisition").
Each Stockholder is a stockholder of ALPNET, Inc. (the "Company") and
is entering into this letter agreement (the "Stockholder Agreement") to induce
you to proceed with a potential Acquisition.
Each Stockholder confirms its agreement with you as follows:
1. The Stockholder represents and warrants that Schedule I annexed hereto
sets forth the shares of Common Stock of the Company, and all options, warrants
and rights thereto, of which the Stockholder or its affiliates (as defined under
the Securities Exchange Act of 1934, as amended) are the record and/or
beneficial owner and that the Stockholder and its affiliates are on the date
hereof the lawful owners of the number of shares of Common Stock, and all
options, warrants and rights thereto, set forth in Schedule I beside the name of
the Stockholder or such other person. Except as set forth in Schedule I, neither
the Stockholder nor any of its affiliates, own or hold any rights to acquire any
additional shares of the capital stock of the Company (by exercise of stock
options or otherwise) or any interest therein or any voting rights with respect
to any additional shares of Common Stock, except as provided in that certain
Purchase Agreement dated as of July 7, 2000 by and between the Company and The
Tail Wind Fund, Ltd. and Resonance Limited and the agreements and documents
entered into in connection therewith (collectively, "Purchase Agreement"). The
Stockholder, has sole voting power and sole power to issue instructions with
respect to the matters set forth herein, sole power of disposition, sole power
of conversion, sole power to demand appraisal rights and sole power to engage in
the actions set forth herein, in each case with respect to the shares of Common
Stock, and all options, warrants and rights thereto, set forth on Schedule I
hereto beside the name of the Stockholder or such other person. As used
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herein, "Warrants" shall mean all options, warrants and rights to shares of the
Company's Common Stock, whether or not set forth on Schedule I hereto, together
with all such options, warrants and rights thereto acquired on and after the
date hereof by the Stockholder or any of its affiliates, as applicable,
including all agreements to which the Stockholder or any affiliate is a party or
beneficiary relating to the right to purchase the Company's Common Stock or
granting to others the right to purchase the Company's Common Stock.
2. Effective and commencing only at the time that SDL first executes a
definitive agreement (not including any binding letter of intent, term sheet or
similar document) (the "Merger Agreement") with the Company regarding a proposed
merger of SDL (or a direct or indirect subsidiary of SDL) with and into the
Company and the Stockholder receives notification that such Merger Agreement has
been executed (such time, the "Merger Agreement Execution Time"), the
Stockholder agrees that, during the period ("Effective Period") commencing on
the Merger Agreement Execution Time and terminating on the earlier of February
28, 2002 and the date on which such Merger Agreement is terminated (which
termination shall be publicly disclosed as soon as possible following such
termination or abandonment), it will not, will not permit any company, trust or
other person or entity controlled by the Stockholder to, and will not permit any
of its affiliates to, contract to sell, sell or otherwise transfer or dispose of
any shares of Company Common Stock or any interest therein or securities
convertible therein to or any voting rights with respect thereto, other than (i)
pursuant to the Acquisition, or (ii) with your prior written consent.
3. Commencing only at the Merger Agreement Execution Time and effective
only during the Effective Period, the Stockholder agrees that it will not, and
will not permit any such company, trust or other entity or person controlled by
the Stockholder to, and will not authorize any of its affiliates to, directly or
indirectly (including through its officers, directors, employees or other
representatives) solicit, initiate, encourage or facilitate, or furnish or
disclose non-public information in furtherance of, any inquiries or the making
of any proposal with respect to any recapitalization, Acquisition, consolidation
or other business combination involving the Company, or the acquisition of any
capital stock or all or substantially all of the assets of the Company, or any
combination of the foregoing (a "Competing Transaction"), or negotiate, explore
or otherwise engage in discussions with any person (other than the Company, SDL
and its affiliates, or their respective directors, officers, employees, agents
and representatives) with respect to any Competing Transaction or enter into any
agreement, arrangement or understanding with respect to any Competing
Transaction or agree to or otherwise assist in the effectuation of any Competing
Transaction; provided, however, that nothing herein shall require the
Stockholder to prevent or restrict any director or trustee of the Stockholder
who is a director or officer of the Company from taking any action in his
capacity as a director or officer of the Company to the extent such director or
officer would be permitted to take such action under the Merger Agreement.
Effective and commencing only at the Merger Agreement Execution Time, the
Stockholder agrees that in the event SDL or any of its affiliates commences a
tender offer in any Acquisition approved by the Company (and not subsequently
rejected) and occurring during the Effective Period, the Stockholder will tender
all of its shares of Common Stock of the Company to SDL or such affiliate, for
consideration at least equal to $0.20 per share, within 10 days following such
commencement of such tender offer and will not thereafter withdraw such shares
(provided that the Stockholder shall not receive less consideration than any
other stockholder of the Company).
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4. Commencing only at the Merger Agreement Execution Time and effective
only during the Effective Period, the Stockholder agrees that all of the shares
of Common Stock beneficially owned by the Stockholder, or over which the
Stockholder has voting power or control, directly or indirectly (including any
shares of Common Stock beneficial ownership of which is acquired by the
Stockholder after the date hereof), at the record date for any meeting of the
Company's stockholders, however called, or in connection with any written
consent of the stockholders of the Company, shall be voted (or caused to be
voted) (i) in favor of the Acquisition, the execution and delivery by the
Company of the Merger Agreement and the approval of the terms thereof and each
of the other actions contemplated by the Merger Agreement and any actions
required in furtherance hereof and thereof; (ii) against any action or agreement
that would result in a breach in any material respect of any covenant,
representation or warranty or any other obligation of the Company under the
Merger Agreement or under this agreement; and (iii) except as otherwise agreed
to in writing in advance by SDL, against the following actions (other than in
connection with the Acquisition and the transactions with you or your affiliates
contemplated by the Merger Agreement): (1) any extraordinary corporate
transaction, such as an acquisition, consolidation or other business combination
involving the Company and its Subsidiaries; (2) any sale, lease or transfer of
all or substantially all of assets of the Company and its Subsidiaries or a
reorganization, recapitalization, dissolution or liquidation of the Company and
its Subsidiaries; (3) (a) subject to Section 7 hereof, any change in the
majority of the Board of Directors of the Company; (b) any material change in
the present capitalization of the Company or any material amendment of the
Company's charter or bylaws; (c) any other material change in the Company's
corporate structure or business; or (d) any other action, in each case for
clauses (a) through (d) which is intended, or could reasonably be expected, to
materially adversely affect consummation of the Acquisition. Commencing only at
the Merger Agreement Execution Time and effective only during the Effective
Period, the Stockholder shall not enter into any agreement or understanding with
any person or entity to vote or give instructions in any manner which would or
could reasonably be expected to cause a violation of clauses (i), (ii) or (iii)
of the preceding sentence.
5. Commencing only at the Merger Agreement Execution Time and effective
only during the Effective Period, the Stockholder hereby grants to, and
appoints, SDL and its officers, and any other designee of SDL, each of them
individually, the Stockholder's irrevocable proxy and attorney-in-fact (with
fill power of substitution) to vote (as indicated in paragraph 4 above) the
shares of Common Stock listed on Schedule I hereto beside the name of the
Stockholder, and any shares of Common Stock beneficial ownership of which is
acquired by the Stockholder after the date hereto at a duly called meeting of
the Company's stockholders (and, in the event the Stockholder has breached its
obligations under this Stockholder Agreement or the Company breaches its
obligation under the Merger Agreement to call and hold or otherwise fails to
hold the Company Stockholders' Meeting, by duly executed written consent of
stockholders). The Stockholder intends this proxy to be irrevocable, subject to
Sections 16 and 17 hereof, and coupled with an interest and will take such
further action and execute such other instruments as may be necessary to
effectuate the intent of this proxy and hereby revokes any proxy previously
granted by the Stockholder with respect to the Stockholder's shares of Common
Stock. Effective and commencing only at the Merger Agreement Execution Time, the
Stockholder agrees that if reasonably requested by SDL, the Stockholder will not
attend or vote any shares of Common Stock beneficially owned by the Stockholder
at any annual or special meeting of stockholders or execute any written consent
of stockholders.
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6. Each party hereto represents and warrants that (1) it has the legal
capacity, power and authority to enter into and perform all of such party's
obligations under this Stockholder Agreement, (2) the execution, delivery and
performance of this Stockholder Agreement by such party hereto will not violate
any other agreement to which such party is a party including, without
limitation, any trust agreement, voting agreement, stockholders agreement or
voting trust, (3) this Stockholder Agreement has been duly and validly executed
and delivered by such party, and is enforceable against such party in accordance
with its terms, and (4) there is no beneficiary or holder of any interest of
such party or any trust of which such party is a trustee whose consent is
required for the execution and delivery of this Stockholder Agreement or the
consummation of the transactions contemplated hereby.
7. Each party represents and warrants that, except for filings with the
Securities and Exchange Commission, if applicable, no filing with, and no
permit, authorization, consent or approval of, any state or federal public body
or authority is necessary for the execution of this Stockholder Agreement by
such party and the consummation by such party of the transactions contemplated
hereby.
8. The Stockholder's shares of Common Stock (as listed on Schedule I) and
the certificates representing such shares of Common Stock are now and at all
times during the Effective Period 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, security interests, rights of first refusal or offer, proxies,
voting trusts or agreements, understandings or arrangements or any other
encumbrances whatsoever, except for any such encumbrances or proxies arising
hereunder.
9. 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 the Stockholder.
10. Each party hereto agrees that damages are an inadequate remedy for the
breach by such party of any term or condition of this Stockholder Agreement and
that the other party hereto shall be entitled, without limitation of other
available rights or remedies, to specific performance, a temporary restraining
order and preliminary and permanent injunctive relief in order to enforce such
other party's agreements herein.
11. During the Effective Period, the Stockholder agrees that this
Stockholder Agreement and the obligations hereunder shall attach to such
Stockholder's shares of Common Stock and shall be binding upon any person or
entity to which legal or beneficial ownership of such shares of Common Stock
shall pass, whether by operation of law or otherwise, including without
limitation such Stockholder's heirs, guardians, administrators or successors.
12. 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 action as may be necessary or reasonably
desirable to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Stockholder Agreement.
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13. This Stockholder Agreement may not be modified, amended, altered or
supplemented, except upon the execution and delivery of a written agreement
executed by the parties hereto.
14. (a) This Stockholder Agreement shall be governed by and construed in
accordance with the laws of the State of New York, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
(b) Whenever possible, each provision or portion of any provision of
this Stockholder 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 Stockholder 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 Stockholder 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. Each party hereto irrevocably and unconditionally
consents and submits to the exclusive jurisdiction of the courts of the State of
New York, County of New York, and of the United States of America located in the
State of New York, County of New York, for any actions, suits or proceedings
arising out of or relating to this agreement and the transactions contemplated
hereby, and further agrees that service of any process, summons, notice or
document by U.S. registered or certified mail to the Stockholder at his or its
address below, or to SDL at the address set forth above, shall be effective
service of process for any action, suit or proceeding brought against such party
in such court (and such address shall be also used for notices under this
Stockholder Agreement). Each party hereto hereby irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or proceeding
arising out of this Stockholder Agreement or the transactions contemplated
hereby, in the courts of the State of New York located in New York City or the
United States of America located in New York City, and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such action, suit or proceeding brought in any such court
has been brought in an inconvenient forum.
15. The Stockholder agrees that upon consummation of the Acquisition in
accordance with the terms hereof, it shall waive and release all of its existing
rights under the Purchase Agreement and any other agreements, understandings and
arrangements that Stockholder has with the Company or any of its affiliates or
subsidiaries (other than rights under law or the Company's organizational
documents), and the Stockholder shall surrender all of its Warrants to the
Company for cancellation, in consideration for SDL paying, or causing the
Company to pay, 50% of the amount of all Debt Reductions (as defined below)
(after netting against 100% of such Debt Reductions all fees and expenses
reasonably incurred directly in connection therewith) effected on or after
November 16, 2001, to all the Investors (as defined in the Purchase Agreement)
in the aggregate ("Waiver Consideration"). SDL agrees that from the date hereof
until the date which is three months following the closing of the Acquisition,
it shall, and/or shall cause the Company to, use its commercially reasonable
efforts in seeking to obtain from the Company's current holders of indebtedness
for borrowed money and other creditors (in no event to include The Tail Wind
Fund, Ltd. or Resonance Limited or any of their respective affiliates) to which
the Company or its subsidiaries owes in excess of $25,000 (including their
successors and assigns) legally binding and effective reductions ("Debt
Reductions") in the amount of monies owed to such creditors by the Company or
its subsidiaries, provided that the Stockholder shall continue to receive Waiver
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Consideration for all Debt Reductions entered into or negotiated on or prior to
the fourth anniversary of the closing of the Acquisition. To the extent
permissible by law, SDL shall keep the Stockholder apprised of all negotiations
and discussions with such creditors in connection with seeking Debt Reduction
and shall allow the Stockholder to participate in such negotiations and
discussions to the extent practicable. The Waiver Consideration shall be paid by
the Company or SDL to the Investors in immediately available funds within five
(5) business days following the collection of each Debt Reduction, and the
Waiver Consideration shall be allocated among the Investors pro rata based on
the number of shares of Company Common Stock currently held as of record by each
such Investor. The Stockholder hereby represents and warrants that it is not a
party to any agreement with the Company other than the Purchase Agreement and
the agreements entered into in connection therewith. Each Stockholder hereby
covenants and agrees with SDL that, during the Effective Period, neither such
Stockholder nor its affiliates, will commence any administrative, legal or
equitable action or proceeding against the Company or its affiliates or their
respective properties seeking any reorganization, receivership or other similar
relief under the U.S. Bankruptcy Code or any other law or regulation for the
benefit of creditors or xxxx xxxxxxxx assets of the Company or its affiliates.
Effective at the Merger Agreement Execution Time and if the Acquisition closes
and so long as SDL complies with this paragraph, each Stockholder, on behalf of
itself and its successors and assigns, hereby covenants and agrees that it
waives any right to any adjustments (including without limitation any right to
receive any additional shares of capital stock of the Company), or right to
purchase, directly or indirectly, any shares of capital stock of the Company,
pursuant to Section 7.1 or Section 7.3 of the Purchase Agreement in connection
with any grant or exercise of any option or other right to purchase shares of
capital stock of the Company granted to SDL or its affiliates in connection with
the Acquisition.
16. Each Stockholder is executing this Stockholder Agreement independently
of the other Stockholder, and each of the representations, warranties,
agreements and obligations hereunder are made with respect to such Stockholder
only, independently, severally and not joint. In no event shall the Stockholder,
by virtue of this Stockholder Agreement, be deemed to be affiliated with, or
constitute a "group" with, any other Stockholder or SDL under Section 13(d) or
Section 16 of the Securities Exchange Act of 1934, as amended, and any
provisions hereof which would otherwise cause such parties to be so affiliated
or constituting a "group" shall be null and void and of no force or effect
hereunder. No person or entity shall be deemed a third party beneficiary of this
Stockholder Agreement, including without limitation the Company or any
stockholder of the Company.
17. This Stockholder Agreement shall terminate and be of no further force
or effect at such time as the Merger Agreement is terminated in accordance with
its terms. The term of this Stockholder Agreement shall be the Effective Period,
provided that Section 15 hereof shall survive any termination of the term hereof
in the event the Acquisition closes.
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Please confirm that the foregoing correctly states the understanding
between us by signing and returning to us a counterpart hereof.
VERY TRULY YOURS,
THE TAIL WIND FUND, LTD.
By: / s / Xxxxxx X. XxxXxxxxx
---------------------------------------------
Name: Xxxxxx X. XxxXxxxxx
Title: Director
Address for Notices: The Tail Wind Fund Ltd.
MeesPierson (Bahamas) Ltd.
Attn: Xxxxxx Xxxxx
Xxxxxxxxxx Xxxxx, 000 Xxxx Xxx Xxxxxx
P.O. Box SS 5539, Nassau, Bahamas
Tel: 242/000-0000 Fax: 242/000-0000
with a copy to:
Xxxxx Xxxxx
c/o EASI
1st Floor, No. 0 Xxxxxx Xxxxxx
Xxxxxx, XX0X 0XX XX
Telephone: 00-000-000-0000
Facsimile: 00-000-000-0000
with a copy to:
Xxxxx X. Xxxxxxx, P.C.
000 Xxxx 00xx Xx., Xx. 00X
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
RESONANCE LIMITED
By: / s / Xxxxxx Xxxxxx
---------------------------------------------
Name: Xxxxxx Xxxxxx
Title: President
Address for Notices: 0000 Xxxx 0xx Xxxxxx
Xxxxxxxx, XX 00000
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AGREED AND ACCEPTED
ON DECEMBER 11, 2001:
SDL PLC
By: / s / Xxxx Xxxxxxxxx
----------------------------------
Name: Xxxx Xxxxxxxxx
Title: Director
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SCHEDULE I
NAME OF STOCKHOLDER COMMON STOCK WARRANTS
THE TAIL WIND FUND, LTD. 1,838,807 shares Warrants to purchase 600,000
shares
NAME OF STOCKHOLDER COMMON STOCK WARRANTS
RESONANCE LIMITED 355,761 shares Warrants to purchase 50,000
shares
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