EXHIBIT 10.7
AMENDMENT TO OPTION AGREEMENT TO PURCHASE STOCK
THIS AMENDMENT TO OPTION AGREEMENT TO PURCHASE STOCK (the "Amendment")
is made and entered into as of July 18, 2002 by and between Mobility
Electronics, Inc., a Delaware corporation ("Seller"), and Cybex Computer
Products Corporation d/b/a/ Avocent-Huntsville, an Alabama corporation
("Purchaser"):
WITNESSETH
WHEREAS, Seller and Purchaser are parties to that certain Option
Agreement to Purchase Stock, dated as of March 1, 2002 (the "Agreement")
regarding the grant by Seller to Purchaser of an option to purchase all of the
shares of the Series A preferred stock that Seller owns of 2C Computing, Inc.
("2C"); and
WHEREAS, the Agreement was scheduled to expire on or about July 18,
2002; and
WHEREAS, Seller and Purchaser desire to amend the Agreement to among
other things extend the term of the Option and provide for a method of closing
the purchase if Purchaser exercises the Option;
WHEREAS, Avocent Corporation ("Avocent") and Purchaser are negotiating
with 2C for the possible acquisition of 2C by Avocent or Purchaser pursuant to a
merger (the "Merger"), whereby 2C would become a wholly-owned subsidiary of
Avocent or Purchaser;
WHEREAS, Purchaser anticipates that the consummation of the Merger (the
"Closing") would be conditioned upon, among other things, the approval of the 2C
shareholders (the "Shareholder Approval") at a duly called meeting of the 2C
Shareholders (the "Shareholders Meeting");
NOW THEREFORE, in consideration of the premises and promises contained
herein, and for other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Section 1.3 of the Agreement shall be deleted in its entirety, and
in lieu thereof shall be inserted the following:
"SECTION 1.3 TERM OF OPTION; EXTENSION; TERMINATION. In
consideration of the prior payments to Seller of $175,000 by Purchaser
under the Agreement, the receipt of which Seller hereby acknowledges by
the execution of this Amendment, and the agreement to pay to Seller the
remaining $25,000 extension payment currently owed by Purchaser to
Seller under the Agreement (the "Outstanding Amount"), as provided
below, Purchaser and Seller agree that the term of the Option (the
"Option Term") shall expire on the earlier of: (i) the close of
business on September 30, 2002; or (ii) the close of business on the
first business day after the conclusion of the Shareholders Meeting.
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2. Section 1.4 of the Agreement shall be deleted in its entirety, and
in lieu thereof shall be inserted the following:
"SECTION 1.4 CONDITIONAL EXERCISE OF OPTION. Purchaser may
exercise the Option, subject to satisfaction of the Shareholder
Approval (if applicable) or the Closing, whichever first occurs, at any
time during the Option Term by delivering to Seller in writing a notice
of conditional exercise (the "Conditional Notice"). Upon receipt of the
Conditional Notice, the Seller shall deliver promptly to counsel for
Purchaser the original certificate or certificates for the Stock,
accompanied by duly executed but undated stock powers transferring
title to the Stock to Purchaser, free and clear of all liens and
encumbrances. Counsel for Purchaser shall hold the Stock in escrow
subject to the provisions of this Section 1.4. If Purchaser delivers
the Conditional Notice to Seller and if either the Shareholder Approval
is received or the Closing occurs on or before September 30, 2002,
Purchaser shall immediately upon the occurrence of such event cause to
be wired to an account designated by Seller $1,669,767, as the purchase
price for the Stock. Counsel for Purchaser shall release the Stock from
escrow for delivery to Purchaser upon receipt from Seller or Seller's
counsel of confirmation that the purchase price has been received by
Seller. If the Conditional Notice is so delivered, and if neither the
Shareholder Approval nor the Closing occur on or before September 30,
2002, for any reason, Purchaser shall before the earlier of the close
of business on the first business day after the conclusion of the
Shareholder Meeting or September 30, 2002, either (i) waive such
applicable condition and deliver to Seller written confirmation of such
waiver and cause to be wired on the date of such waiver to an account
designated by Seller the sum of $1,282,000, or (ii) instruct counsel
for Purchaser to release the Stock from escrow and redeliver the Stock
to Seller. If Purchaser waives the applicable condition and wires the
purchase price to Seller, counsel for Purchaser shall release the Stock
from escrow for delivery to Purchaser upon receipt from Seller or
Seller's counsel of confirmation that the purchase price has been
received by Seller.
3. Section 1.5 of the Agreement shall be deleted in its entirety, and
in lieu thereof shall be inserted the following:
"SECTION 1.5 UNCONDITIONAL EXERCISE OF OPTION. Purchaser may
exercise the Option at any time during the Option Term by delivering to
Seller in writing a notice of unconditional exercise (the
"Unconditional Notice"). Upon receipt of the Unconditional Notice, the
Seller and Purchaser shall conduct a closing within seven (7) days
following the date of the Unconditional Notice (the "Unconditional
Closing"), at which Unconditional Closing Purchaser shall deliver to
Seller by wire transfer to an account designated by Seller, the sum of
$1,282,000, as the purchase price for the Stock, and Seller shall
deliver the Stock to Purchaser; provided, however, that if subsequent
to the Unconditional Closing, Shareholder Approval is obtained or the
Closing occurs, Purchaser shall on the date of the earlier of the date
of the Shareholder Approval or the Closing wire to an account
designated by Seller an additional amount equal to $387,767."
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4. Immediately following Section 1.5, there shall be added new Section
1.6 as follows:
"SECTION 1.6 PROXY. If Seller receives a Conditional Notice or
Unconditional Notice during the Option Term, Seller shall promptly
grant, execute, and deliver to Purchaser a proxy in the form attached
hereto as Exhibit A."
5. Immediately following Section 5.5, there shall be added new Section
5.6 as follows:
"SECTION 5.5 CONFIDENTIALITY. Except as required by applicable
law (including, without limitation, applicable Federal securities
laws), this Amendment, the Agreement, and the transaction contemplated
herein and therein are confidential, and Seller shall not make any
public statement, provide any information, or issue any press release
with respect thereto or disclose the existence or terms of the
Agreement or the Amendment without the express written consent of
Purchaser."
6. Upon execution of this Amendment by the parties hereto, Purchaser
shall immediately deliver $25,000 to Seller by wire transfer to an account
designated by Seller as payment of the Outstanding Amount.
7. All capitalized terms used herein not otherwise defined shall have
the meaning ascribed to them in the Agreement.
8. In all other respects the Agreement shall remain in full force and
effect.
9. This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one and the same Amendment.
IN WITNESS WHEREOF, each of Seller and Purchaser has caused this
Amendment to be executed and delivered to the other party hereto, all as of the
date first above written.
CYBEX COMPUTER PRODUCTS CORPORATION
By: /s/ Douglas E. Pritchett
-----------------------------------
Title: Vice President Finance,
Chief Financial Officer
MOBILITY ELECTRONICS, INC.
By: /s/ Jeffrey S. Doss
-----------------------------------
Title: Executive Vice President
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EXHIBIT A
IRREVOCABLE PROXY
The undersigned shareholder of 2C Computing, Inc., an Alabama
corporation (the "Company"), hereby irrevocably (to the fullest extent permitted
by law) appoints and constitutes Cybex Computer Products Corporation, an Alabama
corporation ("Cybex"), the attorney and proxy of the undersigned with full power
of substitution and resubstitution, to the full extent of the undersigned's
rights with respect to the outstanding shares of the Series A preferred stock of
the Company owned of record by the undersigned as of the date of this proxy,
which shares are specified on the final page of this proxy (the "Shares"). Upon
the execution hereof, all prior proxies given by the undersigned with respect to
any of the Shares are hereby revoked, and the undersigned agrees that no
subsequent proxies will be given with respect to any of the Shares.
This proxy is irrevocable, is coupled with an interest and is granted
in connection with that certain Option Agreement to Purchase Stock, dated as of
March 1, 2002, between Cybex and the undersigned, as amended by that certain
Amendment to Option Agreement to Purchase Stock, dated July ___, 2002 (the
"Option Agreement"), and is granted in consideration of the exercise of the
option pursuant to the Option Agreement, subject to the approval by the
shareholders of the Company of the merger of Cybex Acquisition Corp. (the
"Subsidiary") with and into the Company (the "Merger") pursuant to that certain
Plan and Agreement of Merger, by and among Avocent Corporation, Cybex,
Subsidiary, the Company, and David S. Butler as Escrow Representative, dated
July ___, 2002 (the "Merger Agreement").
The attorney and proxy named above will be empowered, and may exercise
this proxy, to vote the Shares at any time until the earlier to occur of the
valid termination of the Merger Agreement or the effective time of the Merger at
any meeting of the shareholders of the Company, however called, or in connection
with any solicitation of written consents from shareholders of the Company, in
favor of the approval and adoption of the Merger Agreement and the approval of
the Merger, and in favor of any matter relating to consummation of the
transactions contemplated by the Merger Agreement.
The undersigned may vote the Shares on all other matters.
This proxy shall be binding upon the successors and assigns of the
undersigned (including any transferee of any of the Shares).
If any provision of this proxy or any part of any such provision is
held under any circumstances to be invalid or unenforceable in any jurisdiction,
then (a) such provision or part thereof shall, with respect to such
circumstances and in such jurisdiction, be deemed amended to conform to
applicable laws so as to be valid and enforceable to the fullest possible
extent, (b) the invalidity or unenforceability of such provision or part thereof
under such circumstances and in such jurisdiction shall not affect the validity
or enforceability of such provision or part thereof under any other
circumstances or in any other jurisdiction, and (c) the invalidity or
unenforceability of such provision or part thereof shall not affect the validity
or enforceability of the remainder of such provision or the validity or
enforceability of any other provision of this
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proxy. Each provision of this proxy is separable from every other provision of
this proxy, and each part of each provision of this proxy is separable from
every other part of such provision.
This proxy shall terminate upon the earlier of: (i) termination of the
Merger Agreement; or (ii) the effective time of the Merger.
Dated: ________, 2002.
MOBILITY ELECTRONICS, INC.
By:
--------------------------------
Charles R. Mollo
Chief Executive Officer
Number of shares of Series A preferred
stock of the Company owned of record
as of the date of this proxy:
354,000
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