Attached files
Exhibit 10.1
VOTING AGREEMENT
THIS
VOTING AGREEMENT (this “Agreement”) is made and entered
into as of June 1, 2021, by and among Crexendo, Inc., a Nevada
corporation (“Parent”), Steven G. Mihaylo, the
majority stockholder of Parent (the “Stockholder,” and each transferee
that becomes a party hereto as a “Stockholder” pursuant
to Section 5.13
below, as listed on Schedule A, also a
“Stockholder”)
and David Wang in his capacity as Stockholder Representative
pursuant to the Merger Agreement (defined below). Parent,
Stockholder and the NetSapiens Stockholder Representative are each
sometimes referred to herein individually as a “Party” and collectively as the
“Parties.”
RECITALS
WHEREAS, the Parties are entering into this
Agreement in connection with that certain Agreement and Plan of
Merger and Reorganization, dated March 5, 2021 (if and as amended,
the “Merger
Agreement”), by and among
Parent, NetSapiens, Inc., a Delaware corporation (the
“Company”), Crexendo Merger Sub, Inc., a Delaware
corporation and a direct, wholly-owned subsidiary of Parent
(“Merger Sub I”), Crexendo Merger Sub, LLC, a Delaware
limited liability company and a direct, wholly-owned subsidiary of
Parent (“Merger Sub
II” and, together with
Merger Sub I, the “Merger Subs”) and David Wang as Stockholder
Representative therein, providing for, among other things, a
statutory merger of Merger Sub I with and into the Company (the
“First
Merger”), and, as part of
the same overall transaction, the surviving corporation in the
First Merger would merge with and into Merger Sub II (the
“Second
Merger,” and together
with the First Merger, the “Mergers”) pursuant to the terms and conditions of
the Merger Agreement;
WHEREAS, pursuant to the Merger Agreement, Parent
has agreed to (i) include the NetSapiens Board Designee (as defined
in the Merger Agreement) as a nominee to the board of directors of
Parent (the “Board”) on each slate of nominees for election to
the Board proposed by the management of Parent, (ii) recommend the
election of the NetSapiens Board Designee to the stockholders of
Parent, and (iii) otherwise use its reasonable best efforts to
cause the NetSapiens Board Designee to be elected to the Board;
and
WHEREAS, as a condition to the Closing, the
Company has required that Stockholder, and Stockholder has agreed
to, execute and deliver this Agreement with respect to the shares
of common stock, par value $0.001 per share, of Parent
(“Parent Common
Stock”) Beneficially
Owned (as defined below) by Stockholder and set forth below
Stockholder’s signature on the signature page hereto (the
“Original
Shares” and, together
with any additional shares of Parent Common Stock pursuant
to Section 3
hereof, the “Shares”).
NOW,
THEREFORE, in consideration of the foregoing and the respective
covenants and agreements set forth below and for other good and
valuable consideration, the receipt, sufficiency, and adequacy of
which are hereby acknowledged, the Parties hereto, intending to be
legally bound, do hereby agree as follows:
1.1 Definitions. For purposes of
this Agreement, capitalized terms used and not otherwise defined
herein shall have the respective meanings ascribed to such terms in
the Merger Agreement. When used in this Agreement, the following
terms in all of their tenses, cases, and correlative forms shall
have the meanings assigned to them in this Section 1.1.
(a) “Beneficially
Own” or
“Beneficial
Ownership” has the
meaning assigned to such term in Rule 13d-3 under the Exchange Act,
and a Person’s beneficial ownership of securities shall be
calculated in accordance with the provisions of such rule (in each
case, irrespective of whether or not such rule is actually
applicable in such circumstance). For the avoidance of doubt,
“Beneficially Own” and “Beneficial
Ownership” shall also include record ownership of
securities.
(b) “Beneficial
Owner” shall mean the
Person who Beneficially Owns the referenced
securities.
(c) “Person”
shall mean an individual, firm, corporation, partnership,
association, limited liability company, trust or any other
entity.
1.2 Board Composition. Stockholder
agrees, at any annual or special meeting of Parent called with
respect to the election and removal of directors of the Parent, and
at every adjournment or postponement thereof, and on every action
or approval by written consent or consents of Parent stockholders
with respect to the election and removal of directors of the
Parent, to vote or cause the holder of record to vote the Shares in
favor of the NetSapiens Board Designee’s election to the
Board.
1.3 NetSapiens Board Designee. The
initial NetSapiens Board Designee shall be Anand Buch, who shall be
elected to the Board immediately following the First Effective
Time. Subsequent NetSapiens Board Designees will be designated from
time to time by such Company equityholders that either: (a)
received shares of Parent Common Stock at the First Effective Time,
or (b) exercised options to purchase Parent Common Stock issued at
the First Effective Time, holding a majority of the total Parent
Common Stock then held collectively by such Company equityholders
(the “Designating Company
Equityholders”), as communicated to Parent by the
then-serving Stockholder Representative. Any such NetSapiens Board
Designee shall be subject to the approval of Parent (which approval
shall not be unreasonably conditioned, withheld or delayed). No
subsequent NetSapiens Board Designee shall be elected to the Board
until the then-serving NetSapiens Board Designee has been removed
from the Board, either by way of resignation, removal or
death.
1.4 Failure to Designate a Board
Member. In the absence of any designation from the
Designating Company Equityholders that is acceptable to Parent
(which approval shall not be unreasonably conditioned, withheld or
delayed), the director previously designated by them and then
serving shall be reelected if willing to serve unless such
individual has been removed as provided herein, and otherwise such
Board seat shall remain vacant until otherwise filled as provided
above.
1.5 Removal of Board Members.
Stockholder also agrees to vote, or cause to be voted, the Shares
in whatever manner as shall be necessary to ensure
that:
(a) no director elected
pursuant to Section
1.2 of this Agreement may
be removed from office other than for cause unless such removal is
directed or approved by the Designating Company
Equityholders;
(b) any vacancies
created by the resignation, removal or death of the NetSapiens
Board Designee elected pursuant to Section 1.2 shall be filled
pursuant to the provisions of this Section 1; and
(c) upon the request of
the Designating Company Equityholders to remove the NetSapiens
Board Designee, such director shall be removed.
Stockholder
agrees to execute any written consents required to perform the
obligations of this Section 1.
1.6 No Liability for Election of
Recommended Directors. Stockholder shall not have any
liability as a result of voting for any such designee in accordance
with the provisions of this Agreement.
2. Remedies.
2.1 Covenants of the Parent. The
Parent agrees to use its best efforts, within the requirements of
applicable law, to ensure that the rights granted under this
Agreement are effective and that the Parties enjoy the benefits of
this Agreement. Such actions include, without limitation, the use
of the Parent’s best efforts to cause the nomination and
election of NetSapiens Board Designee as provided in this
Agreement.
2.2 Irrevocable Proxy and Power of
Attorney. Stockholder hereby appoints Stockholder
Representative and any designee of Stockholder Representative, and
each of them individually, until the Expiration Time (as defined
below) (at which time this proxy shall automatically be revoked),
its proxies and attorneys-in-fact, with full power of substitution
and resubstitution, to vote or act by written consent during the
term of this Agreement with respect to the Shares in accordance
with Section
1. This proxy and
power of attorney is given to secure the performance of the duties
of Stockholder under this Agreement. Stockholder shall take such
further action or execute such other instruments as may be
necessary to effectuate the intent of this proxy. This proxy and
power of attorney granted by Stockholder shall be irrevocable until
the Expiration Time, shall be deemed to be coupled with an interest
sufficient in law to support an irrevocable proxy, and shall revoke
any and all prior proxies granted by Stockholder with respect to
the Shares. The power of attorney granted by Stockholder herein is
a durable power of attorney and shall survive the bankruptcy,
death, or incapacity of Stockholder. The proxy and power of
attorney granted hereunder shall terminate at the Expiration
Time.
2.3 Specific Enforcement. Each
Party acknowledges and agrees that each Party hereto will be
irreparably damaged in the event any of the provisions of this
Agreement are not performed by the Parties in accordance with their
specific terms or are otherwise breached. Accordingly, it is agreed
that each of the Parent, Stockholder Representative and Stockholder
shall be entitled to an injunction to prevent breaches of this
Agreement, and to specific enforcement of this Agreement and its
terms and provisions in any action instituted in any court of the
United States or any state having subject matter
jurisdiction.
2.4 Remedies Cumulative. All
remedies, either under this Agreement or by law or otherwise
afforded to any Party, shall be cumulative and not
alternative.
3. Additional Shares. Stockholder
agrees that all shares of Parent Common Stock that Stockholder
purchases, acquires the right to vote, or otherwise acquires
Beneficial Ownership of after the execution of this Agreement and
prior to the Expiration Time shall be subject to the terms and
conditions of this Agreement and shall constitute Shares for all
purposes of this Agreement. In the event of any stock split, stock
dividend, merger, reorganization, recapitalization,
reclassification, combination, exchange of shares, or the like of
the capital stock of Parent affecting the Shares, the terms of this
Agreement shall apply to the resulting securities and such
resulting securities shall be deemed to be “Shares” for
all purposes of this Agreement.
4. Termination. This Agreement
shall terminate upon the earliest to occur of (the
“Expiration
Time”): (a) that date on which the Company
equityholders that received shares of Parent Common Stock at the
First Effective Time fail to collectively Beneficially Own at least
Five Percent (5%) of Parent’s total issued and outstanding
shares of common stock any time after the Closing; and (b) the
termination of this Agreement by mutual written consent of the
Parties. Nothing in this Section 4 shall relieve or
otherwise limit the liability of any Party for any intentional
breach of this Agreement prior to such termination.
5. Miscellaneous.
5.1 Successors and Assigns. The
terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective successors and assigns of the
Parties. Nothing in this Agreement, express or implied, is intended
to confer upon any party other than the Parties hereto or their
respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this
Agreement.
5.2 Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Nevada regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws
thereof.
5.3 Counterparts. This Agreement
may be executed in two (2) or more counterparts, each of which
shall be deemed an original, but all of which together shall
constitute one and the same instrument. Counterparts may be
delivered via electronic mail (including pdf or any electronic
signature complying with the U.S. ESIGN Act of 2000, e.g., www.docusign.com) or other
transmission method and any counterpart so delivered shall be
deemed to have been duly and validly delivered and be valid and
effective for all purposes.
5.4 Titles and Subtitles. The
titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or
interpreting this Agreement.
5.5 Notices. All notices, requests,
consents, claims, demands, waivers and other communications
hereunder shall be in writing and shall be deemed to have been
given: (a) when delivered by hand (with written confirmation of
receipt); (b) when received by the addressee if sent by a
nationally recognized overnight courier (receipt requested); (c) on
the date sent by email of a PDF document (with confirmation of
transmission) if sent during normal business hours of the
recipient, and on the next Business Day if sent after normal
business hours of the recipient; or (d) on the third day after the
date mailed, by certified or registered mail, return receipt
requested, postage prepaid. Such communications must be sent to the
respective Parties at the following addresses (or at such other
address for a Party as shall be specified in a notice given in
accordance with this Section 5.5):
Crexendo,
Inc.
1615
South 52nd Street
Tempe,
AZ 85281
Attention: Jeffrey
Korn, General Counsel
Email:
jkorn@crexendo.com
with a
copy (which shall not constitute notice) to:
Squire
Patton Boggs (US) LLP
1 E.
Washington St., Suite 2700
Phoenix, Arizona
85004
Attention: Matthew
M. Holman, Esq.
Email:
matthew.holman@squirepb.com
Stockholder
Representative:
David
Wang
PO
Box 8588
LA
Jolla, CA 92038
Email:
david@wangsfamily.net
with
a copy (which shall not constitute notice) to:
Procopio,
Cory, Hargreaves & Savitch LLP
525
B Street, Suite 2200
San
Diego, California 92101
Attention:
William W. Eigner, Esq.
Email:
william.eigner@procopio.com
If to
Stockholder, to the address or email address set forth for
Stockholder on the signature page or Schedule A hereof.
5.6 Delays or Omissions. No delay
or omission to exercise any right, power or remedy accruing to any
Party under this Agreement, upon any breach or default of any other
Party under this Agreement, shall impair any such right, power or
remedy of such non-breaching or non-defaulting Party nor shall it
be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default
previously or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of any Party of any
breach or default under this Agreement, or any waiver on the part
of any Party of any provisions or conditions of this Agreement,
must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to any Party, shall
be cumulative and not alternative.
5.7 Severability. The invalidity or
unenforceability of any provision hereof shall in no way affect the
validity or enforceability of any other provision.
5.8 Entire Agreement. This
Agreement and the Merger Agreement constitute the full and entire
understanding and agreement between the Parties with respect to the
subject matter hereof, and any other written or oral agreement
relating to the subject matter hereof existing between the parties
is expressly canceled.
5.9 Manner of Voting. The voting of
Shares pursuant to this Agreement may be effected in person, by
proxy, by written consent or in any other manner permitted by
applicable law. For the avoidance of doubt, voting of the Shares
pursuant to the Agreement need not make explicit reference to the
terms of this Agreement.
5.10 Further
Assurances. At any time or from time to time after the date
hereof, the Parties agree to cooperate with each other, and at the
request of any other Party, to execute and deliver any further
instruments or documents and to take all such further action as the
other Party may reasonably request in order to carry out the intent
of the parties hereunder.
5.11 Submission
to Jurisdiction. Each of the Parties hereto irrevocably
agrees that any legal action with respect to this Agreement and the
rights and obligations arising hereunder, or for recognition and
enforcement of any judgment in respect of this Agreement and the
rights and obligations arising hereunder brought by the other Party
hereto or its successors or assigns shall be brought and determined
exclusively in the state or
federal courts located in the County of Clark, State of
Nevada. Each of the Parties hereto agrees that mailing of
process or other papers in connection with any such legal action in
the manner provided in Section 5.5 or in such other
manner as may be permitted by applicable laws, will be valid and
sufficient service thereof. Each of the Parties hereto hereby
irrevocably submits with regard to any such legal action for itself
and in respect of its property, generally and unconditionally, to
the personal jurisdiction of the aforesaid courts and agrees that
it will not bring any action relating to this Agreement or any of
the transactions contemplated by this Agreement in any court or
tribunal other than the aforesaid courts. Each of the Parties
hereto hereby irrevocably waives, and agrees not to assert, by way
of motion, as a defense, counterclaim, or otherwise, in any legal
action with respect to this Agreement and the rights and
obligations arising hereunder, or for recognition and enforcement
of any judgment in respect of this Agreement and the rights and
obligations arising hereunder: (i) any claim that it is not
personally subject to the jurisdiction of the above named courts
for any reason other than the failure to serve process in
accordance with this Section
5.11; (ii) any
claim that it or its property is exempt or immune from jurisdiction
of any such court or from any legal process commenced in such
courts (whether through service of notice, attachment prior to
judgment, attachment in aid of execution of judgment, execution of
judgment, or otherwise); and (iii) to the fullest extent permitted
by the applicable law, any claim that (x) the suit, action, or
proceeding in such court is brought in an inconvenient forum, (y)
the venue of such suit, action, or proceeding is improper, or (z)
this Agreement, or the subject matter hereof, may not be enforced
in or by such courts.
5.12 Waiver
of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTACT, TORT, OR OTHERWISE) ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY
HERETO IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR THE ACTIONS
OF ANY PARTY HERETO IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT HEREOF.
5.13 Transfers.
(a) Each transferee or
assignee of any Shares subject to this Agreement in a private
transaction (i.e., not made via sale into the public market) shall,
together with the number of Shares transferred to such Stockholder,
be listed on Schedule
A, and shall continue to be subject to the terms hereof,
and, as a condition precedent to the Parent’s recognition of
such transfer, each transferee or assignee shall agree in writing
to be subject to each of the terms of this Agreement by executing
and delivering an Adoption Agreement substantially in the form
attached hereto as Exhibit
A. Upon the execution and delivery of an Adoption Agreement
by any transferee, such transferee shall be deemed to be a party
hereto as if such transferee were the transferor and such
transferee’s signature appeared on the signature pages of
this Agreement and shall be deemed to be a Stockholder. Parent
shall not permit the private transfer of the Shares subject to this
Agreement on its books or issue a new certificate representing any
such Shares unless and until such transferee shall have complied
with the terms of this Section 5.13. Each certificate,
instrument, or book entry representing the Shares subject to this
Agreement, including any Shares issued on or after the date of this
Agreement or Shares transferred in a private transaction as
provided for in this Section 5.13, shall be notated
with the following legend:
“THE SHARES
REPRESENTED HEREBY ARE SUBJECT TO A VOTING AGREEMENT, AS MAY BE
AMENDED FROM TIME TO TIME (A COPY OF WHICH MAY BE OBTAINED UPON
WRITTEN REQUEST FROM THE COMPANY), AND BY ACCEPTING ANY INTEREST IN
SUCH SHARES THE PERSON ACCEPTING SUCH INTEREST SHALL BE DEEMED TO
AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF THAT
VOTING AGREEMENT, INCLUDING CERTAIN RESTRICTIONS ON TRANSFER AND
OWNERSHIP SET FORTH THEREIN.”
The
foregoing legend may be not be removed by Parent without the
consent of Stockholder Representative except in the event of a sale
of Shares into the public market.
(b) (i) Following the
date that is ten (10) years after the date hereof, the provisions
of Section 5.13(a) shall not apply to any transfer occurring as a
result of the death or disability of Stockholder or (ii) the
provisions of Section 5.13(a) shall not apply to any transfer made
by Stockholder to a trust or other entity
for the benefit of any Person that is qualified as a charitable
organization under Section 501(c)(3) of the Code, or a family
foundation established by or on behalf of one or more of the
Shareholders for the purpose of making charitable gifts or
donations to Persons that are qualified as charitable organizations
under Section 501(c)(3) of the Code.
5.14 Consent
Required to Amend, Modify, Terminate or Waive. This
Agreement may be amended, modified or terminated and the observance
of any term hereof may be waived (either generally or in a
particular instance and either retroactively or prospectively) only
by a written instrument executed by (a) Parent; (b) Stockholder;
and (c) Stockholder Representative; provided that the consent of a
Party shall not be required for any amendment, modification,
termination or waiver if such amendment, modification, termination,
or waiver is not directly applicable to the rights of such Party
hereunder.
5.15 Costs
of Enforcement. If any Party to this Agreement seeks to
enforce its rights under this Agreement by legal proceedings, the
non-prevailing party shall pay all costs and expenses incurred by
the prevailing party, including, without limitation, all reasonable
attorneys’ fees.
[Signature Page Follows]
IN
WITNESS WHEREOF, the Parties hereto have executed and delivered
this Agreement as of the date first written above.
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CREXENDO,
INC.
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By /s/ Jeffrey
G. Korn .
Name:
Jeffrey G. Korn
Title:
Secretary
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STOCKHOLDER
REPRESENTATIVE
/s/ David Wang .
Name:
David Wang
STOCKHOLDER
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/s/ Steven G. Mihaylo .
Name:
Steven G. Mihaylo
Number
of Shares of Parent Common Stock Beneficially Owned as of the date
of this Agreement: 10,298,468
Number
of Options Beneficially Owned as of the date of this Agreement:
116,234
Street
Address: 1615 S. 52nd Street
City/State/Zip
Code: Tempe, AZ 85281
Email:
smihaylo@crexendo.com
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Signature Page to Voting Agreement
EXHIBIT A
ADOPTION AGREEMENT
This
Adoption Agreement (“Adoption
Agreement”) is executed on _______________, 20__, by
the undersigned (the “Holder”) pursuant to the terms of
that certain Voting Agreement dated as of June 1, 2021 (the
“Agreement”), by
and among Parent, Stockholder and Stockholder Representative, as
such Agreement may be amended or amended and restated hereafter.
Capitalized terms used but not defined in this Adoption Agreement
shall have the respective meanings ascribed to such terms in the
Agreement. By the execution of this Adoption Agreement, the Holder
agrees as follows:
1.1
Acknowledgement. Holder
acknowledges that Holder is acquiring certain shares of the capital
stock of Parent (the “Stock”) as a transferee of Shares
from a Stockholder in such party’s capacity as a
“Stockholder” bound by the Agreement, and after such
transfer, Holder shall be considered a “Stockholder”
for all purposes of the Agreement.
1.2
Agreement. Holder hereby (a)
agrees that the Shares and any other shares of capital stock or
securities required by the Agreement to be bound thereby, shall be
bound by and subject to the terms of the Agreement and (b) adopts
the Agreement with the same force and effect as if Holder were
originally a party thereto.
1.3
Notice. Any notice required or
permitted by the Agreement shall be given to Holder at the address
or facsimile number listed below Holder’s signature
hereto.
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HOLDER:
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ACCEPTED AND
AGREED
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PARENT:
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Name:
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Title:
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By:
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Address:
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Name:
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Title:
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STOCKHOLDER
REPRESENTATIVE
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SCHEDULE A
Transferee
Stockholders:
Name: _____________
Number of Shares of Parent Common Stock Beneficially Owned as a
result of a transfer under Section
5.13:
_________
Address:
Name: _____________
Number of Shares of Parent Common Stock Beneficially Owned as a
result of a transfer under Section
5.13:
_________
Address:
Signature Page to Voting Agreement