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EXHIBIT 2.02
Agreement and Plan of Merger dated as of November 12, 1996 by and
between Worldtalk Merger Corporation and Xxxxxx Software, Inc.
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AGREEMENT AND PLAN OF MERGER
OF
WORLDTALK MERGER CORPORATION, A WASHINGTON CORPORATION
INTO
DEMING SOFTWARE, INC., A WASHINGTON CORPORATION
This Agreement and Plan of Merger is made by and between Worldtalk
Merger Corporation, a Washington corporation ("Worldtalk MC"), and Deming
Software, Inc., a Washington corporation ("Deming"). Worldtalk MC proposes to
merge with and into Deming, with Xxxxxx being the surviving corporation. The
Boards of Directors and shareholders of both Worldtalk MC and Xxxxxx have
approved the merger upon the terms set forth herein and have authorized the
execution hereof.
NOW THEREFORE, the parties agree as follows:
1. MERGER. Upon the terms of this Agreement and Plan of Merger,
on the Effective Date (as defined below) in accordance with the Washington
Business Corporation Act, Worldtalk MC shall be merged with and into Xxxxxx
(the "Merger") and the separate existence of Worldtalk MC shall thereupon
cease. Xxxxxx shall be the surviving corporation in the Merger (hereinafter
sometimes referred to as the "Surviving Corporation").
2. EFFECTIVE DATE. The Merger shall become effective as of the
date of the filing of the articles of merger and this Agreement, pursuant to
RCW 23B.11.050, with the Secretary of State of the State of Washington (the
"Effective Date").
3. CONVERSION OF SHARES. On the Effective Date:
3.1 Conversion of Worldtalk MC Shares. Each share of
common stock of Worldtalk MC that is outstanding immediately prior to the
Effective Date shall be converted to one share of Common Stock, $.0001 par
value, of Xxxxxx ("Xxxxxx Stock").
3.2 Exchange of Xxxxxx Common Stock. Holders of shares
of Xxxxxx Stock ("Xxxxxx Shareholders") issued and outstanding immediately
prior to the Effective Date will receive the following in exchange for all of
their shares of Xxxxxx Stock:
(a) an aggregate cash payment to all of such
shareholders of $225,000 (the "Cash Payment"), plus
(b) a number of fully paid and nonassessable
shares of Common Stock, $.01 par value, of Worldtalk Communications
Corporation ("Worldtalk"), a Delaware corporation that is the parent
of Worldtalk MC ("Worldtalk Common Stock"), that is determined by
dividing the amount of the Cash Payment by the Average Price (defined
below) of the Worldtalk Common Stock and then subtracting the quotient
obtained from the number of Initial Shares (the "Stock Payment").
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For purposes of this calculation, the "Average Price" will mean the average of
the closing sale prices of Worldtalk's Common Stock reported in the Western
Edition of The Wall Street Journal or, if not published therein, The San Xxxx
Mercury News, on the basis of information provided by the Nasdaq National
Market for each of the ten (10) trading days immediately preceding the day
prior to the date upon which the Closing is held. The number of "Initial
Shares" shall be (a) 565,000 if the Average Price is greater than or equal to
$9.00 but less than or equal to $15.00, (b) 452,000 if the Average Price is
greater than $15.00 and (c) 753,333 if the Average Price is less than $9.00.
4. ADDITIONAL PROVISIONS RELATED TO THE CONVERSION OF SHARES.
4.1 Payment to each Xxxxxx Shareholder. Each Xxxxxx
Shareholder has elected to receive a proportion of the Cash Payment.
Accordingly, each Xxxxxx Shareholder will be entitled to receive (a) a cash
payment equal to the amount set forth in the last column of the table below,
titled "Cash Payment to be Received," plus (b) the number of shares of
Worldtalk Common Stock that is determined by dividing the amount of such
person's cash payment by the Average Price of the Worldtalk Common Stock and
then subtracting the quotient obtained from the applicable number of Initial
Shares obtained for such person from the table below.
INITIAL SHARES
INITIAL SHARES IF IF AP IS INITIAL SHARES
AP IS BETWEEN GREATER THAN IF AP IS LESS
$15.00 AND $9.00 $15.00 PER THAN $9.00 PER CASH PAYMENT
NAME OF SHAREHOLDER PER SHARE SHARE SHARE TO BE RECEIVED
------------------- ----------------- -------------- -------------- --------------
Xxxxxx X. Xxxxxxxx 114,142 91,313 152,189 $ 96,000
Xxxxxx X. Xxxxxxxxx 222,574 178,061 296,766 0
Xxxxx X. Xxxxx, Xx. 114,142 91,313 152,189 64,500
Xxxxx X. Xxxxxxxx 114,142 91,313 152,189 64,500
------- ------- ------- --------
Totals: 565,000 452,000 753,333 $225,000
Each of the parties hereto agrees that the value of each Xxxxxx Shareholder's
portion of the Stock Payment plus the Cash Payment to each such shareholder as
a percentage of the total value of the Stock Payment plus Cash Payment to be
received by all such shareholders, is equal to the percent of Xxxxxx Stock held
by such shareholder.
4.2 Adjustments in Number of Shares. If, prior to the
Merger, Worldtalk or Xxxxxx recapitalizes through a split-up of its outstanding
shares into a greater number, or a combination of its outstanding shares into a
lesser number, reorganizes, reclassifies or otherwise changes its outstanding
shares into the same or a different number of shares of other classes (other
than through a split-up or combination of shares provided for in the previous
clause), or declares a dividend on its outstanding shares payable in shares or
securities convertible into shares, the number of shares of Worldtalk Common
Stock into which the shares of Xxxxxx Stock are to be converted will be
adjusted appropriately so as to maintain the proportionate interests of the
holders of the shares of Xxxxxx Stock and the holders of the shares of
Worldtalk Common Stock.
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4.3 Cash Payment. The Cash Payment to each Xxxxxx
Shareholder will be made on January 2, 1997, by Worldtalk's delivery to each
Xxxxxx Shareholder, by personal delivery or by deposit in the United States
mail, postage prepaid, of a check made payable to such shareholder in the full
amount of the portion of the Cash Payment to be received by such shareholder on
the date of each payment.
4.4 Fractional Shares. No fractional shares of Worldtalk
Common Stock will be issued in connection with the Merger, but in lieu thereof
each holder of Xxxxxx Stock who would otherwise be entitled to receive a
fraction of a share of Worldtalk Common Stock will receive from Worldtalk,
promptly after the Effective Date, an amount of cash equal to the Average Price
multiplied by the fraction of a share of Worldtalk Common Stock to which such
holder would otherwise be entitled.
4.5 Escrow Agreement. At the Closing of the Merger,
Worldtalk will withhold 15% of the shares of Worldtalk Common Stock to be
issued to the Xxxxxx Shareholders in accordance with Section 3.2 (rounded up to
the nearest whole number of shares to be issued to each Xxxxxx Shareholder),
and deliver such shares (the "Escrow Shares") to Xxxxxx Trust and Savings Bank
(the "Escrow Agent"), as escrow agent, to be held by Escrow Agent as collateral
for Xxxxxx'x and the Xxxxxx shareholders' indemnification obligations. The
Escrow Shares will be represented by a certificate or certificates issued in
the name of the Escrow Agent and, assuming no claim is made against such
shares, will be held by the Escrow Agent from the Closing until one (1) year
after the Effective Date pursuant to the terms of a certain Escrow Agreement of
even date herewith among Worldtalk, Xxxxxx, the shareholders of Xxxxxx and the
Escrow Agent.
4.6 Conversion Procedure.
(a) As of the Effective Date, all shares of
Xxxxxx Stock that are outstanding immediately prior thereto will, by virtue of
the Merger and without further action, cease to exist and will be converted,
subject to Section 4.4, into the right to receive from Worldtalk the number of
shares of Worldtalk Common Stock and cash determined as set forth in Section 3.
(b) As soon as practicable after the Effective
Date, each holder of shares of Xxxxxx Stock will surrender the certificate(s)
for such shares (the "Xxxxxx Certificates"), duly endorsed as requested by
Worldtalk, to Worldtalk for cancellation. Promptly after the Effective Date
and receipt of such Xxxxxx Certificates, Worldtalk will issue to each tendering
holder a certificate for the number of shares of Worldtalk Common Stock to
which such holder is entitled pursuant to Section 3 hereof, less the shares of
Worldtalk Common Stock deposited into escrow pursuant to Section 4.5 hereof,
and distribute any cash payable under Section 4.4.
(c) No dividends or distributions payable to
holders of record of Worldtalk Common Stock after the Effective Date, or cash
payable in lieu of fractional shares or otherwise, will be paid to the holder
of any unsurrendered Xxxxxx Certificate(s) until the holder of the Xxxxxx
Certificate(s) surrenders such Xxxxxx Certificate(s). Subject to the effect,
if any,
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of applicable escheat and other laws, following surrender of any Xxxxxx
Certificate, there will be delivered to the person entitled thereto, without
interest, the amount of any dividends and distributions therefor paid with
respect to Worldtalk Common Stock so withheld as of any date subsequent to the
Effective Date and prior to such date of delivery.
(d) All Worldtalk Common Stock and cash delivered
upon the surrender of Xxxxxx Stock in accordance with the terms hereof will be
deemed to have been delivered in full satisfaction of all rights pertaining to
such Xxxxxx Stock. There will be no further registration of transfers on the
stock transfer books of Xxxxxx or its transfer agent of the Xxxxxx Stock. If,
after the Effective Date, Xxxxxx Certificates are presented for any reason,
they will be canceled and exchanged as provided in this Section 4.6.
(e) Until certificates representing Xxxxxx Stock
outstanding prior to the Merger are surrendered pursuant to Section 4.6(b)
above, such certificates will be deemed, for all purposes, to evidence
ownership of the number of shares of Worldtalk Common Stock into which the
Xxxxxx Stock will have been converted, reduced by the number of shares withheld
as Escrow Shares.
(f) The Cash Payment will be made as specified in
Section 4.3 above.
5. ASSETS AND LIABILITIES. On the Effective Date:
5.1 Assets. Xxxxxx shall thereupon and thereafter
possess all the rights, privileges, and immunities, and all property, real,
personal and mixed, and all debts due on whatever account, and other choses in
action, and all and every other interest of or belonging to Worldtalk MC, all
of which shall be taken and deemed to be transferred to Xxxxxx without further
act or deed; and
5.2 Liabilities. Xxxxxx shall be responsible and liable
for all the liabilities and obligations of Worldtalk MC.
6. NAME. The name of the Surviving Corporation shall be:
XXXXXX SOFTWARE, INC.
7. DIRECTORS AND PRINCIPAL OFFICERS. The directors and the
principal officers of Worldtalk MC immediately prior to the Effective Date
shall serve as directors and officers of the Surviving Corporation on and after
the Effective Date.
8. ARTICLES OF INCORPORATION AND BYLAWS. On and after the
Effective Date, the Articles of Incorporation of Xxxxxx and the Bylaws of
Worldtalk MC in effect immediately prior to the Effective Date shall be the
Articles of Incorporation and the Bylaws of the Surviving Corporation.
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9. COUNTERPARTS. This Agreement and Plan of Merger may be
executed in any number of counterparts each of which shall be deemed an
original and all of such counterparts shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
and Plan of Merger as of the 12th day of November, 1996.
WORLDTALK MERGER CORPORATION,
a Washington corporation
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Vice President
DEMING SOFTWARE, INC.,
a Washington corporation
/s/ Xxxxxx X. Xxxxxxxxx, III
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Xxxxxx X. Xxxxxxxxx, III
President
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