EXHIBIT 99.1
STOCKHOLDERS AGREEMENT dated as of August
17, 1999 (this "Agreement"), among LUCENT
TECHNOLOGIES INC., a Delaware corporation ("Parent"),
and the individuals and other parties listed on
Schedule A attached hereto (each, a "Stockholder"
and, collectively, the "Stockholders").
WHEREAS Parent, Dallas Merger Inc., a Massachusetts
corporation and a wholly owned subsidiary of Parent ("Sub"), and Excel Switching
Corporation, a Massachusetts corporation (the "Company"), propose to enter into
an Agreement and Plan of Merger dated as of the date hereof (as the same may be
amended or supplemented, the "Merger Agreement"; terms used but not defined
herein shall have the meanings set forth in the Merger Agreement), providing
for, among other things, the merger of Sub with and into the Company, upon the
terms and subject to the conditions set forth in the Merger Agreement;
WHEREAS each Stockholder owns the number of shares of capital
stock of the Company set forth opposite such Stockholder's name on Schedule A
attached hereto (such shares of capital stock of the Company, together with any
other shares of capital stock of the Company acquired by such Stockholder after
the date hereof and during the term of this Agreement (including through the
exercise of any stock options, warrants or similar instruments), being
collectively referred to herein as the "Subject Shares"); and
WHEREAS as a condition to its willingness to enter into the
Merger Agreement, Parent has requested that each Stockholder enter into this
Agreement.
NOW, THEREFORE, to induce Parent to enter into, and in
consideration of its entering into, the Merger Agreement, and in consideration
of the premises and the representations, warranties and agreements contained
herein, the parties hereto agree as follows:
1. AGREEMENT TO VOTE SHARES. Each Stockholder agrees during
the term of this Agreement to vote, or cause to be voted, its Subject Shares, in
person or by proxy, in favor of the Merger, the adoption and approval of the
Merger
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Agreement and the approval of the transactions contemplated by the Merger
Agreement at every meeting of the stockholders of the Company at which such
matters are considered and at every adjournment thereof.
2. GRANT OF IRREVOCABLE PROXY. Each Stockholder hereby
irrevocably grants to, and appoints, Pamela F. Craven and Jean F. Rankin and any
other individual who shall hereafter be designated by Parent, and each of them,
such Stockholder's proxy and attorney-in-fact (with full power of substitution),
for and in the name, place and stead of such Stockholder, to vote, or cause to
be voted, such Stockholder's Subject Shares, or grant a consent or approval in
respect of such Subject Shares, at any meeting of stockholders of the Company or
at any adjournment thereof or in any other circumstances upon which their vote,
consent or other approval is sought, in favor of the Merger, the adoption and
approval of the Merger Agreement and the approval of the transactions
contemplated by the Merger Agreement.
3. NO OTHER GRANT OF PROXY. Each Stockholder will not,
directly or indirectly, grant any proxies or powers of attorney with respect to
its Subject Shares to any person in connection with its vote, consent or other
approval sought, in favor of the Merger, the adoption and approval of the Merger
Agreement and the approval of the transactions contemplated by the Merger
Agreement, other than as set forth in Section 2.
4. TRANSFERS. Other than this Agreement, each Stockholder will
not, nor will such Stockholder permit any entity under such Stockholder's
control to, sell, transfer, pledge, assign or otherwise dispose of (including by
gift) (collectively, "Transfer"), or consent to any Transfer of, any Subject
Shares or any interest therein or enter into any contract, option or other
agreement or arrangement (including any profit sharing or other derivative
arrangement) with respect to the Transfer of, any Subject Shares or any interest
therein to any person, unless prior to any such Transfer the transferee of such
Subject Shares agrees to be subject to the provisions of this Agreement.
5. NO VOTING TRUSTS. Each Stockholder agrees that it will not
enter into any voting trust or other arrangement or agreement, or agree, in any
manner, with respect to its vote, consent or other approval sought, in favor of
the Merger, the adoption and approval of the Merger Agreement and the approval
of the transactions contemplated by the Merger Agreement (and if entered into or
executed, such voting trust or other arrangement or agreement shall not be
effective).
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6. NO SOLICITATION. Until the Merger is consummated or the
Merger Agreement is terminated, each Stockholder shall not, nor shall it permit
any investment banker, attorney or other advisor or representative of such
Stockholder to, directly or indirectly through another person, solicit,
initiate, encourage or otherwise facilitate any Takeover Proposal.
7. AFFILIATE AGREEMENT. (a) If, at the time the Merger
Agreement is submitted for approval to the stockholders of the Company, a
Stockholder is an "affiliate" of the Company for purposes of Rule 145 under the
Securities Act or for purposes of qualifying the Merger for pooling of interests
accounting treatment under Opinion 16 of the Accounting Principles Board and
applicable SEC rules and regulations, such Stockholder shall deliver to Parent
at least 30 days prior to the Closing a written agreement substantially in the
form attached as Exhibit A to the Merger Agreement.
(b) Each Stockholder shall use reasonable efforts to cause the
transactions contemplated by the Merger Agreement, including the Merger, to be
accounted for as a pooling of interests transaction under Opinion 16 of the
Accounting Principles Board and applicable SEC rules and regulations. Each
Stockholder agrees that it shall take no action that would cause such accounting
treatment not to be obtained.
8. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS. Each
Stockholder hereby, severally and not jointly, represents and warrants to Parent
in respect of himself or itself as follows:
(a) AUTHORITY. Such Stockholder has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly authorized, executed and
delivered by such Stockholder and constitutes a valid and binding obligation of
such Stockholder enforceable in accordance with its terms. The execution and
delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby and compliance with the terms hereof will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
of time or both) under any provision of, any trust agreement, loan or credit
agreement, note, bond, mortgage, indenture
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lease or other agreement, instrument, permit, concession, franchise, license,
judgment, order, notice, decree, statute, law, ordinance, rule or regulation
applicable to such Stockholder or to such Stockholder's property or assets.
Except for (i) such filings under the Exchange Act as may be required in
connection with this Agreement and the transactions contemplated hereby and (ii)
informational filings with the SEC, no consent, approval, order or authorization
of, or registration, declaration or filing with any Governmental Entity is
required by or with respect to such Stockholder in connection with the execution
and delivery of this Agreement or the consummation by such Stockholder of the
transactions contemplated hereby.
(b) THE SUBJECT SHARES. Such Stockholder has good and
marketable title to the Subject Shares, free and clear of all Liens.
9. REPRESENTATIONS AND WARRANTIES OF PARENT. Parent hereby
represents and warrants to each Stockholder that Parent has all requisite
corporate power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Parent, and the consummation of the transactions contemplated hereby, has
been duly authorized by all necessary corporate action on the part of Parent.
This Agreement has been duly executed and delivered by Parent and constitutes a
valid and binding obligation of Parent enforceable in accordance with its terms.
10. ENFORCEMENT. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled, without the posting of
any bond, to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this Agreement in any
federal court located in the State of Delaware or in Delaware state court, this
being in addition to any other remedy to which they are entitled at law or in
equity, and neither party will oppose the granting of such relief on the basis
that the other party has an adequate remedy at law.
11. TERM AND TERMINATION. Subject to Section 16(f), the term
of this Agreement shall commence on
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the date hereof and shall terminate upon the earlier of (i) the Effective Time
and (ii) the date that is ten Business Days after the date on which the Merger
Agreement is terminated in accordance with its terms. No such termination of
this Agreement shall relieve any party hereto from any liability for breach of
this Agreement prior to termination.
12. CERTAIN EVENTS. Each Stockholder agrees that this
Agreement and the obligations hereunder shall attach to such Stockholder's
Subject Shares and shall be binding upon any Person to which legal or beneficial
ownership of such Subject Shares shall pass, whether by operation of law or
otherwise, including such Stockholder's heirs, guardians, administrators or
successors. In the event of any stock split, stock dividend, merger,
reorganization, recapitalization or other change in the capital structure of the
Company affecting the Subject Shares, or the acquisition of additional shares of
the Company's capital stock by such Stockholder, the number of Subject Shares
listed on Schedule A beside the name of such Stockholder shall be adjusted
appropriately and this Agreement and the obligations hereunder shall attach to
any additional shares of the Company's capital stock issued to or acquired by
such Stockholder.
13. STOCKHOLDER CAPACITY. No person executing this Agreement
who is or becomes during the term hereof a director or officer of the Company
makes (or shall be deemed to have made) any agreement or understanding herein in
his or her capacity as such director or officer. Without limiting the generality
of the foregoing, each Stockholder signs solely in its or his capacity as the
record and/or beneficial owner, as applicable, of such Stockholder's Subject
Shares and nothing herein shall limit or affect any actions taken by such
Stockholder (or a designee of such Stockholder) in his or her capacity as an
officer or director of the Company in exercising his or her rights under the
Merger Agreement.
14. ENTIRE AGREEMENT; NO THIRD PARTY BENEFICIARIES; AMENDMENT;
WAIVER. This Agreement (including the documents and instruments referred to
herein) (i) constitutes the entire agreement and supersedes all prior agreements
and understandings, written or oral, among the parties with respect to the
subject matter hereof and (ii) is not intended to confer upon any Person other
than
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the parties hereto any rights or remedies hereunder. This Agreement may not be
amended, supplemented or modified, and no provisions hereof may be modified or
waived, except by an instrument in writing signed by each party to be charged.
No waiver of any provisions hereof by any party shall be deemed a waiver of any
other provisions hereof by any such party, nor shall any such waiver be deemed a
continuing waiver of any provision hereof by such party.
15. NOTICES. All notices, consents, requests, instructions,
approvals and other communications provided for herein shall be in writing and
shall be deemed to have been duly given if mailed, by first class or registered
mail, three business days after deposit in the United States Mail, or if telexed
or telecopied, sent by telegram, or delivered by hand or reputable overnight
courier, when confirmation is received, in each case as follows:
If to the Stockholders, to the addresses listed on Schedule A hereto;
If to Parent, in accordance with Section 8.02 of the Merger Agreement;
or to such other persons or addresses as may be designated in writing by the
party to receive such notice.
16. MISCELLANEOUS. (a) When a reference is made in this
Agreement to Sections, such reference shall be to a Section of this Agreement
unless otherwise indicated. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Wherever the words "include," "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation".
(b) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws.
(c) If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any
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term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible to the fullest
extent permitted by applicable law in an acceptable manner and to the end that
the transactions contemplated hereby are fulfilled to the extent possible.
(d) This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more of the counterparts have been signed by
each of the parties and delivered to the other parties, it being understood that
each party need not sign the same counterpart.
(e) This Agreement shall not be assigned by any Stockholder,
on the one hand, without the prior written consent of Parent, or by Parent, on
the other hand, without the prior written consent of the Stockholders, except
that Parent may assign, in its sole discretion, any or all of its rights,
interests and obligations hereunder to any direct or indirect wholly owned
subsidiary of Parent; provided that notwithstanding such assignment, Parent
shall remain liable for performance of its obligations hereunder. Subject to the
preceding sentence, this Agreement will be binding upon, inure to the benefit of
and be enforceable by the parties and their respective successors and assigns.
(f) The obligations of the Stockholders set forth in this
Agreement shall not be effective or binding upon the Stockholders until after
such time as the Merger Agreement is executed and delivered by Parent, Sub and
the Company.
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(g) Each Stockholder agrees to take, or cause to be taken, all
actions, and to do, or cause to be done, and assist and cooperate with the other
Stockholders in doing, all things necessary, proper or advisable to cause a
Stockholder Meeting to be held as promptly as practicable after the date hereof.
IN WITNESS WHEREOF, Parent has caused this Agreement to be
signed by its officer thereunto duly authorized and each Stockholder has signed
this Agreement, all as of the date first written above.
LUCENT TECHNOLOGIES INC.,
by
/s/Pamela F. Craven
-------------------------
Name: Pamela F. Craven
Title: Vice President-Law
& Secretary
/s/Robert P. Madonna
------------------------
Robert P. Madonna
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THE MADONNA FAMILY LIMITED
PARTNERSHIP,
by Robert P. Madonna, its
General Partner
/s/Robert P. Madonna
------------------
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SCHEDULE A
Name and Number of Percentage of Voting Power
Address of Each Outstanding of
Stockholder Shares Owned the Company
----------- ------------ -----------
Robert P. Madonna 23,021,310 62.3%
The Madonna Family Limited Partnership 4,191,840 11.3%