-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CowZaa/qW5tqUBVPxR7sio3O4wb1XPmNn8lpHi+xSVCce2YtLgk/6AnPctRq/Wj4 kD2sDT2BUzlwkWDqH4BQPQ== 0000950135-05-005364.txt : 20050913 0000950135-05-005364.hdr.sgml : 20050913 20050913155613 ACCESSION NUMBER: 0000950135-05-005364 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20050913 DATE AS OF CHANGE: 20050913 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GILER ERIC R CENTRAL INDEX KEY: 0001190863 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: BUSINESS PHONE: 7815306041 MAIL ADDRESS: STREET 1: C/O NETEGRITY INC STREET 2: 201 JONES RD CITY: WALTHAM STATE: MA ZIP: 02451 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: BROOKTROUT INC CENTRAL INDEX KEY: 0000754516 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 042814792 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-43794 FILM NUMBER: 051082285 BUSINESS ADDRESS: STREET 1: 250 FIRST AVE STREET 2: SUITE 300 CITY: NEEDHAM STATE: MA ZIP: 02494 BUSINESS PHONE: 7814494100 MAIL ADDRESS: STREET 1: 250 FIRST AVE STREET 2: SUITE 300 CITY: NEEDHAM STATE: MA ZIP: 02494 FORMER COMPANY: FORMER CONFORMED NAME: BROOKTROUT TECHNOLOGY INC DATE OF NAME CHANGE: 19941021 SC 13D 1 b56856bisc13d.txt BROOKTROUT, INC. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ----------- SCHEDULE 13D (RULE 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-l(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (Amendment No. ____)(1) Brooktrout, Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $.01 par value per share - -------------------------------------------------------------------------------- (Title of Class of Securities) 114580103 - -------------------------------------------------------------------------------- (CUSIP Number) Eric R. Giler Brooktrout, Inc. 250 First Avenue Needham, MA 02494 Tel. (781) 449-4100 with a copy to: Mark L. Johnson Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, MA 02109 Tel. (617) 526-6038 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) August 18, 2005 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. - ---------- (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 114580103 13D Page 2 of 7 - -------------------------------------------------------------------------------- 1. NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Eric R. Giler - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS* PF, SC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States of America - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ----------------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY EACH 885,039 (1) REPORTING ----------------------------------------------------------- PERSON WITH 9. SOLE DISPOSITIVE POWER 672,272 (2) ----------------------------------------------------------- 10. SHARED DISPOSITIVE POWER 212,767 (3) - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 885,039 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.7% (4) - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- (1) Includes (a) 212,092 shares held jointly with Mr. Giler's spouse, (b) 675 shares held by Mr. Giler's spouse, as custodian, on behalf of their children, as to which shares Mr. Giler disclaims beneficial ownership, and (c) 441,925 shares issuable pursuant to outstanding stock options exercisable within 60 days of August 15, 2005. These shares are subject to the Stockholder Voting Agreement described in Item 4. (2) Includes 441,925 shares issuable pursuant to outstanding stock options exercisable within 60 days of August 15, 2005. These shares are subject to the Stockholder Voting Agreement described in Item 4. CUSIP No. 114580103 13D Page 3 of 7 (3) Consists of (a) 212,092 shares held jointly with Mr. Giler's spouse and (b) 675 shares held by Mr. Giler's spouse, as custodian, on behalf of their children, as to which shares Mr. Giler disclaims beneficial ownership. These shares re subject to the Stockholder Voting Agreement described in Item 4. (4) Based on 12,761,894 shares of Common Stock outstanding as of August 15, 2005. ITEM 1. SECURITY AND ISSUER. The class of equity securities to which this statement relates is the common stock, par value $.01 per share (the "Common Stock") of Brooktrout, Inc., a Massachusetts corporation (the "Company"). The principal executive office of the Company is located 250 First Avenue, Needham, Massachusetts 02494. ITEM 2. IDENTITY AND BACKGROUND. This statement is filed by Eric R. Giler, President of the Company. The Company is a provider of communications hardware and software products. Mr. Giler's business address is the principal executive office of the Company, which is 250 First Avenue, Needham, Massachusetts 02494. During the last five years, Mr. Giler has not been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors). During the last five years, Mr. Giler has not been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as result of which it was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Mr. Giler is a citizen of the United States of America. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. A total of 299,677 shares of Common Stock to which this Schedule 13D relates were purchased from the Company for aggregate consideration of approximately $412,000 paid by Mr. Giler and his spouse from their respective personal funds. A total of 225 of these shares were given by Mr. Giler as a gift to a custodial account for the benefit of one of Mr. Giler's children; Mr. Giler's spouse is the custodian of this account. A total of 450 shares of Common Stock to which this Schedule 13D relates were donated by third-parties as gifts to custodial accounts for the benefit of Mr. Giler's children. Mr. Giler's spouse is the custodian for these accounts. A total of 142,987 shares of Common Stock to which this Schedule 13D relates were purchased by Mr. Giler from the Company for aggregate consideration of $2,762,961, of which $2,761,531 was financed through the Brooktrout, Inc. Stock Option Loan Program and $1,430 was paid by Mr. Giler from his personal funds. Pursuant to the Stock Option Loan Program, the Company offered nonrecourse loans to its officers, including Mr. Giler, to finance the exercise price of previously granted and fully vested nonqualified stock options held by them. Each loan to Mr. Giler related to the exercise of a specific option and was evidenced by a nonrecourse promissory note and security agreement (a "Promissory Note"). The shares of Common Stock purchased upon exercise of each option were pledged as collateral to secure repayment of the applicable Promissory Note. Each Promissory Note is due and payable upon the earlier of (1) 90 days following termination of Mr. Giler's employment with us and (2) the expiration of the term of the option relating to such Promissory Note. Each Promissory Note may be paid in cash or by surrender of the shares of the then-remaining shares of Common Stock pledged as collateral for such Promissory Note. If Mr. Giler chooses to surrender shares of Common Stock in repayment of the Promissory Note, the value of such shares shall be deemed to be equal to the then principal amount outstanding under the Promissory Note, regardless of the actual fair market value of such shares at the time of surrender. The Promissory Notes may be prepaid, in whole or in part, without premium or penalty. In connection with the merger discussed below in Item 4, Mr. Giler delivered to the Company, on August 18, 2005, a Notice of Election to Repay Outstanding Loans under the Brooktrout, Inc. Stock Option Loan Program (the "Notice to CUSIP No. 114580103 13D Page 4 of 7 Repay"). Pursuant to the Notice to Repay, Mr. Giler has agreed to repay the outstanding balance of his Promissory Notes in full. Promissory Notes relating to options that had an exercise price over $13.05 per share will be repaid by surrendering shares of Common Stock pledged as collateral for the applicable Promissory Note, and the remainder of the outstanding balance of Mr. Giler's Promissory Notes will be repaid in cash from proceeds received by Mr. Giler in the merger. A total of 441,925 shares of Common Stock to which this Schedule 13D relates are issuable to Mr. Giler pursuant to outstanding stock options exercisable within 60 days of August 15, 2005. Mr. Giler has not exercised these options and therefore has not paid any consideration for these shares. ITEM 4. PURPOSE OF TRANSACTIONS. On August 18, 2005, EAS Group, Inc., a Delaware corporation ("EAS Group"), XL Acquisition Corp., a Massachusetts corporation and wholly owned subsidiary of EAS Group (the "Merger Subsidiary") and the Company entered into an Agreement and Plan of Merger (the "Merger Agreement"), which provides that, subject to certain conditions, Merger Subsidiary will be merged with and into the Company, with the Company continuing as the surviving corporation (the "Surviving Corporation"). Upon consummation of the merger, the Articles of Organization and the By-Laws of the Company as in effect immediately prior to the merger will be the Articles of Organization and the By-Laws of the Surviving Corporation, and the directors and officers of the Merger Subsidiary will become the directors and officers of the Surviving Corporation. As a result of the merger, the Common Stock will be removed from quotation on The Nasdaq National Market and deregistered under the Securities Exchange Act of 1934, as amended, and the Company will become a wholly owned subsidiary of EAS Group. In connection with the Merger Agreement, as a condition to the willingness of EAS Group and the Merger Subsidiary to enter into the Merger Agreement, and as an inducement and in consideration therefor, EAS Group entered into separate Stockholder Voting Agreements, dated as of August 18, 2005, with certain executive officers and directors of the Company, including Mr. Giler. Pursuant to the Stockholder Voting Agreement between EAS Group and Mr. Giler (the "Voting Agreement"), Mr. Giler irrevocably granted and appointed EAS Group as his proxy and attorney-in-fact to vote or cause to be voted each of the 885,039 shares of the Common Stock beneficially owned by Mr. Giler in favor of the adoption of the Merger Agreement and in accordance with the voting requirements set forth in the Voting Agreement. Merger Agreement Under the Merger Agreement, at the effective time of the merger (the "Effective Time") and as a result of the merger, each share of Common Stock of the Company issued and outstanding immediately prior to the Effective Time (other than shares owned by EAS Group or the Merger Subsidiary, shares owned by any direct or indirect wholly owned subsidiary of the Company and any dissenting shares whose holders have perfected their rights to dissent as described in the Merger Agreement) shall be automatically converted into the right to receive $13.05 in cash, without interest (the "Merger Consideration"). As of the Effective Time, all such shares will no longer be outstanding and will automatically be canceled and will cease to exist, and subject to the rights of the dissenting shareholders under the Merger Agreement, each holder of a certificate representing any such shares will cease to have any rights with respect to such shares except the right to receive the Merger Consideration upon the surrender of such certificate in accordance with the Merger Agreement, without interest. Completion of the merger is subject to the satisfaction of a number of conditions, including the receipt of regulatory approvals and approval of the Merger Agreement by a vote of the holders of not less than two-thirds of the outstanding shares of Common Stock. Voting Agreement Pursuant to the Voting Agreement, among other things, Mr. Giler has agreed: - - to appear at the special meeting of the shareholders of the Company held for the purpose of approving the Merger Agreement or otherwise cause his shares to be counted at such shareholder meeting for purposes of calculating a quorum; CUSIP No. 114580103 13D Page 5 of 7 - - to vote in favor of any proposal to adjourn such meeting if necessary to permit the further solicitation of proxies in the event that there are not sufficient votes to approve the Merger Agreement at the time of the shareholder meeting; and - - to vote all of his shares of Common Stock (a) in favor of approval of the Merger Agreement and (b) against any letter of intent, acquisition agreement, merger agreement or similar agreement providing for the consummation of a transaction contemplated by an alternative acquisition proposal. Mr. Giler has appointed EAS Group, with full power of substitution, as his attorney and irrevocable proxy, to the full extent of his rights with respect to his shares, to vote, if he is unable to perform his obligations under the Voting Agreement, each of such shares in the manner described above. The proxy is intended to be irrevocable until the termination of the Voting Agreement. In the Voting Agreement, Mr. Giler also has agreed that, until the conclusion of the special meeting of the shareholders of the Company held for the purpose of approving the Merger Agreement, he will not (except as contemplated in the Voting Agreement or Merger Agreement) directly or indirectly (1) sell, transfer, assign, pledge, encumber or otherwise dispose of his shares, (2) deposit any of his shares into a voting trust or enter into a voting agreement or arrangement, or grant any proxy or power of attorney with respect to his shares that is inconsistent with the Merger Agreement, (3) enter into any contract, option or other arrangement with respect to the direct or indirect sale, transfer, assignment or other disposition of any of his shares. However, Mr. Giler may make (1) transfers by will or by operation of law, in which case the Voting Agreement will bind the transferee, (2) transfers in connection with estate and charitable planning purposes, including transfers to relatives, trusts and charitable organizations, subject to the transferee agreeing in writing to be bound by the terms of, and perform the obligations of Mr. Giler under, the Voting Agreement, and (3) as EAS Group may otherwise agree in writing. The foregoing summary of the merger and the Merger Agreement is qualified in its entirety by reference to the Merger Agreement that is filed as Exhibit 1 to this Schedule 13D. The foregoing summary of the Voting Agreement is qualified in its entirety by reference to the Voting Agreement that is filed as Exhibit 2 to this Schedule 13D. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) and (b) As of the date hereof, Mr. Giler beneficially owns in the aggregate 885,039 shares of Common Stock, representing approximately 6.7% of the shares of Common Stock that Mr. Giler believes were outstanding as of August 15, 2005. Of these shares, (a) 212,092 shares are held jointly with Mr. Giler's spouse, (b) 675 shares are held by Mr. Giler's spouse, as custodian, on behalf of their children, as to which shares Mr. Giler disclaims beneficial ownership, and (c) 441,925 shares are issuable pursuant to outstanding stock options exercisable within 60 days of August 15, 2005. Mr. Giler has shared power to vote or direct the vote of all 885,039 shares. Mr. Giler has sole power to dispose or direct the disposition of 672,272 of these shares and shared power to dispose or direct the disposition of 212,767 of these shares. To the knowledge of Mr. Giler, EAS Group is a Delaware corporation with a principal purpose of holding all of the capital stock of Excel Switching Corporation, a Delaware corporation ("Excel Switching") that provides carrier-class, open services platforms, media gateways and media servers. To the knowledge of Mr. Giler, the principal business address of EAS Group is 75 Perseverance Way, Hyannis, Massachusetts 02601. To the knowledge of Mr. Giler, EAS Group has not, during the last five years, been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. To the knowledge of Mr. Giler, Kim Giler, Mr. Giler's spouse, is a citizen of the United States of America. To the knowledge of Mr. Giler, the address of Mrs. Giler is c/o Eric Giler, Brooktrout, Inc., 250 First Avenue, CUSIP No. 114580103 13D Page 6 of 7 Needham, Massachusetts 02494. To the knowledge of Mr. Giler, Mrs. Giler has not, during the last five years, been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (c) None. (d) None. (e) Not applicable. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Other than the Merger Agreement, the Voting Agreement, the Promissory Notes, the Notice to Repay and various stock option agreements between Mr. Giler and the Company, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between Mr. Giler and any person or entity with respect to any securities of the Company, including but not limited to transfer or voting of any of the securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. The following documents are filed as exhibits to this Schedule 13D and incorporated herein by reference.
Exhibit No. Description - ----------- ----------- 1 Agreement and Plan of Merger, dated as of August 18, 2005, by and among Brooktrout, Inc., EAS Group, Inc. and XL Acquisition Corp. is hereby incorporated by reference from Exhibit 2.1 to Amendment to Current Report on Form 8-K/A filed with the SEC on August 19, 2005 (File No. 000-20698). 2 Stockholder Voting Agreement, dated as of August 18, 2005, by and among Brooktrout, Inc., EAS Group, Inc. and Eric R. Giler. 3 Promissory Note, dated March 3, 2000, in the principal aggregate amount of $2,330,233.88, executed by Eric R. Giler in favor of Brooktrout, Inc. 4 Promissory Note, dated March 3, 2000, in the principal aggregate amount of $298,546.88, executed by Eric R. Giler in favor of Brooktrout, Inc. 5 Promissory Note, dated March 3, 2000, in the principal aggregate amount of $132,750.00, executed by Eric R. Giler in favor of Brooktrout, Inc. 6 Notice of Election to Repay Outstanding Loans under the Brooktrout, Inc. Stock Option Loan Program, delivered by Eric R. Giler on August 18, 2005.
CUSIP No. 114580103 13D Page 7 of 7 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: September 13, 2005 /s/Eric R. Giler ------------------------------------- Eric R. Giler EX-99.2 2 b56856biexv99w2.txt STOCKHOLDER VOTER AGREEMENT STOCKHOLDER VOTING AGREEMENT STOCKHOLDER VOTING AGREEMENT, dated as of August 18, 2005 (this "Agreement"), between the stockholder identified on the signature page hereto (the "Stockholder"), and EAS Group, Inc., a Delaware corporation ("Buyer"). Capitalized terms used and not otherwise defined herein shall have the respective meanings assigned to them in the Merger Agreement referred to below. WHEREAS, as of the date hereof, the Stockholder owns of record and beneficially shares of common stock, par value $0.01 per share, and owns of record or beneficially options and other rights to acquire shares of common stock, of Brooktrout, Inc., a Massachusetts corporation (the "Company"), as set forth on the signature page hereto (such shares and options, or any other voting or equity securities of the Company hereafter acquired by any Stockholder prior to the termination of this Agreement, being referred to herein collectively as the "Shares"); WHEREAS, concurrently with the execution of this Agreement, Buyer and the Company are entering into an Agreement and Plan of Merger, dated as of the date hereof (the "Merger Agreement"), pursuant to which, upon the terms and subject to the conditions thereof, a subsidiary of Buyer will be merged with and into the Company, and the Company will be the surviving corporation (the "Merger"); and WHEREAS, as a condition to the willingness of Buyer to enter into the Merger Agreement, Buyer has required that the Stockholder agree, and in order to induce Buyer to enter into the Merger Agreement, the Stockholder is willing to enter into this Agreement. NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein, and intending to be legally bound hereby, the parties hereby agree, severally and not jointly, as follows: Section 1. Voting of Shares. (a) The Stockholder covenants and agrees that until the termination of this Agreement in accordance with the terms hereof, the Stockholder shall (a) appear at the Company Meeting or any other meeting of the stockholders of the Company, however called, or otherwise cause his, her or its Shares to be counted as present thereat for purposes of calculating a quorum, (b) vote in favor of any proposal to adjourn such meeting if necessary to permit the further solicitation of proxies in the event that there are not sufficient votes at the time of such meeting to approve the Merger Agreement, (c) vote, or cause to be voted, all of his, her or its Shares (i) in favor of the approval of the Merger Agreement, and (ii) against approval of any Alternative Acquisition Agreement. (b) Subject to the last sentence of this Section 1(b), the Stockholder hereby irrevocably (to the extent permitted by law) grants to, and appoints, the Buyer as its proxy and attorney-in-fact (with full power of substitution), for and in its name, place and stead, to vote his, her or its Shares, if the Stockholder is unable to perform his, her or its obligations under this Agreement, at any meeting of the stockholders of the Company called with respect to any of the matters specified in, and solely in accordance and consistent with, Section 1(a). The Stockholder hereby affirms that the irrevocable proxy set forth in this Section 1(b) is given in connection with the execution of the Merger Agreement, and that such irrevocable proxy is given to secure the performance of the obligations of the Stockholder under this Agreement. Except as otherwise provided for herein, the Stockholder hereby affirms that the appointment of the proxy is coupled with an interest and intended to be irrevocable in accordance with the provisions of Section 7.22 of the Massachusetts Business Corporation Act. Notwithstanding any other provisions of this Agreement, the irrevocable proxy granted hereunder shall automatically terminate upon the termination of this Agreement. Section 2. Transfer of Shares. The Stockholder covenants and agrees that, prior to the conclusion of the Company Meeting, the Stockholder will not directly or indirectly (i) sell, assign, transfer, pledge, encumber or otherwise dispose of any of the Shares, (ii) deposit any of the Shares into a voting trust or enter into a voting agreement or arrangement with respect to the Shares or grant any proxy or power of attorney with respect thereto which is inconsistent with this Agreement or (iii) enter into any contract, option or other arrangement or undertaking with respect to the direct or indirect sale, assignment, transfer or other disposition of any Shares prior to the conclusion of the Company Meeting. Notwithstanding the foregoing, the Stockholder may make (i) transfers by will, or by operation of law, in which case this Agreement shall bind the transferee, (ii) transfers in connection with estate and charitable planning purposes, including transfers to relatives, trusts and charitable organizations, subject to the transferee agreeing in writing to be bound by the terms of, and perform the obligations of the Stockholder under, this Agreement and (iii) as the Buyer may otherwise agree in writing. Section 3. Representations and Warranties. The Stockholder represents and warrants to Buyer as of the date hereof as follows: (a) Ownership of Shares. The Stockholder beneficially owns all of the Shares and options to acquire Shares as set forth on the signature page hereto. The Stockholder owns no shares of Company Common Stock other than the Shares as set forth on the signature page hereto. The Stockholder has sole voting power with respect to all of the Shares. (b) Power, Binding Agreement. The Stockholder has the legal capacity and all requisite power and authority to enter into and perform all of its obligations under this Agreement. This Agreement has been duly and validly executed and delivered by the Stockholder and constitutes a valid and binding obligation of the Stockholder, enforceable against the Stockholder in accordance with its terms, subject to the Bankruptcy and Equity Exception. (c) No Conflicts. The execution and delivery of this Agreement do not, and the performance of this Agreement by the Stockholder will not, conflict with or violate (i) any contract, agreement, license, instrument or permit to which the Stockholder is a party or by which the Stockholder is bound, or (ii) any law applicable to the Stockholder or by which the Stockholder is bound. Except as expressly contemplated hereby, the Stockholder is not a party to, and the Shares are not subject to or bound in any manner by, any contract or agreement relating to the Shares, including without limitation, any voting agreement, option agreement, purchase agreement, stockholders' agreement, partnership agreement or voting trust. (d) No Restraints. As of the date hereof, there is no suit, action investigation or proceeding pending or, to the knowledge of the Stockholder, threatened against the Stockholder before or by any governmental entity or person that could impair the ability of the Stockholder to perform its obligations hereunder or to consummate the transactions contemplated hereby on a timely basis Section 4. Termination. This Agreement shall terminate upon the earlier to occur of (i) the Effective Time or (ii) any termination of the Merger Agreement. Section 5. Specific Performance. The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement was not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy at law or in equity. Section 6. Fiduciary Duties. The Stockholder is signing this Agreement solely in such Stockholder's capacity as an owner of his, her or its respective Shares, and nothing herein shall prohibit, prevent or preclude such Stockholder from taking or not taking any action in his or her capacity as an officer or director of the Company, to the extent permitted by the Merger Agreement. Subject to the foregoing sentence, the Stockholder agrees, solely in his, her or its capacity as a Stockholder to comply with Section 6.1 of the Merger Agreement -2- Section 7. Miscellaneous. (a) Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, both written and oral, between the parties with respect thereto. This Agreement may not be amended, modified or rescinded except by an instrument in writing signed by each of the parties hereto. (b) Severability. 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 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 a mutually acceptable manner in order that the terms of this Agreement remain as originally contemplated to the fullest extent possible. (c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts without regard to the principles of conflicts of law thereof. (d) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. (e) Notices. All notices and other communications hereunder shall be in writing and shall be deemed duly delivered (i) three business days after being sent by registered or certified mail, return receipt requested, postage prepaid, or (ii) one business day after being sent for next business day delivery, fees prepaid, via a reputable nationwide overnight courier service, in each case to the intended recipient as set forth below: (i) if to the Stockholder to the address set forth on the signature page of this Agreement; and (ii) if to the Buyer to: EAS Group, Inc. 75 Perseverance Way Hyannis, Massachusetts 02601 Tel: 508-862-3000 Fax: 508-862-3020 Attn: Marc Zionts with a copy to: McDermott, Will & Emery LLP 227 West Monroe Street Chicago, Illinois 60606 Tel: 312-372-2000 Fax: 312-984-7700 Attn: Neal White Esq./Thomas Conaghan, Esq. (f) No Third Party Beneficiaries. This Agreement is not intended, and shall not be deemed, to confer any rights or remedies upon any person other than the parties hereto and their respective successors and permitted assigns, to create any agreement of employment with any person or to otherwise create any third-party beneficiary hereto. -3- (g) Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned or delegated, in whole or in part, by operation of law or otherwise by any of the parties hereto without the prior written consent of the other parties, and any such assignment without such prior written consent shall be null and void. Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns. (h) Interpretation. When reference is made in this Agreement to a Section, such reference shall be to a Section of this Agreement, unless otherwise indicated. The headings contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural, and vice versa. Any reference to any federal, state, local or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. Whenever the words "include," "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation." No summary of this Agreement prepared by the parties shall affect in any way the meaning or interpretation of this Agreement. (i) Submission to Jurisdiction. Each of the parties to this Agreement (i) consents to submit itself to the personal jurisdiction of any state or federal court sitting in the Boston, Massachusetts in any action or proceeding arising out of or relating to this Agreement or any of the transactions contemplated by this Agreement, (ii) agrees that all claims in respect of such action or proceeding may be heard and determined in any such court, (iii) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court and (iv) agrees not to bring any action or proceeding arising out of or relating to this Agreement or any of the transactions contemplated by this Agreement in any other court. Each of the parties hereto waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety or other security that might be required of any other party with respect thereto. Any party hereto may make service on another party by sending or delivering a copy of the process to the party to be served at the address and in the manner provided for the giving of notices in Section 7(e). Nothing in this Section, however, shall affect the right of any party to serve legal process in any other manner permitted by law. (j) WAIVER OF JURY TRIAL. EACH OF THE BUYER AND THE STOCKHOLDER HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF THE BUYER OR THE STOCKHOLDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT. [signature page to follow] -4- IN WITNESS WHEREOF, each of the parties hereto has caused this Stockholder Voting Agreement to be signed individually or by its respective duly authorized officer as of the date first written above. BUYER By: /s/Marc Zionts ----------------------------------------- Name: --------------------------------------- Title: -------------------------------------- STOCKHOLDER: /s/Eric R. Giler -------------------------------------------- Signature Eric R. Giler -------------------------------------------- Name [address omitted] -------------------------------------------- Address -------------------------------------------- Address Number of Shares: --------------------------- Number of Options: -------------------------- -5- EX-99.3 3 b56856biexv99w3.txt PROMISSORY NOTE DATED MARCH 3, 2000 - $2,330,233.88 Exhibit 3 NONRECOURSE PROMISSORY NOTE AND SECURITY AGREEMENT $2,330,233.88 March 3, 2000 FOR VALUE RECEIVED, Eric R. Giler, who resides at [address omitted] (hereinafter referred to as the Employee), hereby promises to pay to the order of Brooktrout, Inc., a Massachusetts corporation with its principal place of business at 410 First Avenue, Needham, Massachusetts 02494 (hereinafter referred to as the Company), the principal amount of Two Million Three Hundred Thirty Thousand Two hundred Thirty Three Dollars and Eighty Eight Cents ($2,330,233.88) subject to the terms and conditions set forth herein. 1. Purpose and Authority. This Promissory Note and Security Agreement (the Note) is entered into for the purpose of financing the Employees exercise of options with respect to 103,612 shares of common stock of the Company (the Shares) pursuant to and subject to the terms and conditions of (i) the Company's policy on loans to executive officers, and (ii) the 1992 Stock Incentive Plan, as amended from time to time. 2. Security. The Employee hereby grants the Company a security interest in 103,612 Shares (hereinafter referred to as the Collateral Shares) and in any and all distributions and dividends which may from time to time be, paid or payable on the Collateral Shares from and after the date hereof. Employee agrees to take all such actions and execute all such documents as may from time to time be reasonably requested by the Company to perfect and maintain the validity and priority of any security interest granted to the Company pursuant to this Note. Employee also agrees that a carbon, photographic or other reproduction of this Promissory Note and Security Agreement may be filed as a financing statement to the extent that the Company determines that such filing is necessary for the Company to establish or maintain its security interest in the Collateral Shares. 3. Maturity. The entire principal balance shall be due and payable on or before 6/19/06 (the Maturity Date). 4. Interest. The Note will bear no interest. 5. Prepayment. The Employee may prepay the whole or any part of the principal amount of this Note from time to time without premium or penalty. In the event the Employee prepays any part of the principal amount of this Note, the number of Collateral Shares shall be proportionately reduced. 6. Payment. (a) The Employee shall pay the entire outstanding balance of this Note on or before the earlier of: (i) that date which is ninety (90) days after termination of the Employees employment with the Company; or (ii) the Maturity Date. (b) The Employee may, at his election, pay the entire outstanding balance of this Note by either (i) cash payment or (ii) irrevocably tendering to the Company all of the remaining Collateral Shares, regardless of the value of the remaining Collateral Shares at such time. The Company and the Employee agree that in the event the Employee makes payment pursuant to this Section 6(b)(ii), the entire outstanding balance of this Note shall be deemed to be equal to the value of the remaining Collateral Shares. (c) If the Employee fails to pay the outstanding balance of this Note at the time such outstanding balance is due and payable, the Company may, except as otherwise provided herein, exercise the rights and remedies accorded a secured party by the Uniform Commercial Code as enacted in the Commonwealth of Massachusetts. 7. Nonrecourse. Except as specifically provided with respect to the Collateral Shares, this Note shall be without recourse against the Employee or his assets. The Company and the Employee agree that the Employee shall have no personal liability for any deficiency which may arise upon a foreclosure and sale or other disposition of the Collateral Shares. 8. Modification. Neither this Note nor any provision hereof may be modified, altered, or amended in any manner or form except by an agreement in writing, executed by a duly authorized officer of the Company and the Employee, which writing shall make specific reference hereto. 9. Transfer by Employee. Employee will not sell, assign, transfer or otherwise dispose of, directly or indirectly, nor grant any option with respect to, or pledge or grant any security interest in or otherwise encumber any of the Collateral Shares or any interest therein, except for the security interest provided for in this Note. 10. Severability. If for any reason any provision or provisions hereof are determined to be invalid, unenforceable or contrary to any existing or future law, such invalidity or unenforceability shall not impair the operation or affect those portions of this Note which are valid. 11. Limitations by Law. All agreements between the Employee and the Company are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of the indebtedness or otherwise, shall the amount paid or agreed to be paid to the holder for the use, forbearance or detention of the indebtedness evidenced hereby exceed the maximum amount which the holder is permitted to receive under applicable law. If, from any circumstances whatsoever, fulfillment of any provision of this Note, at the time performance of such provision shall be due, shall involve payments exceeding such amount, then the obligation to be fulfilled shall automatically be reduced to the limit of such maximum amount. As used herein, the term Applicable law shall mean the law in effect as of the date hereof. This provision shall control every other provision of this Note. 12. Governing Law. The execution, delivery and performance of this Note shall be governed by, construed, and enforced in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to conflicts of laws principles, and each of the parties - 2 - consents to the non-exclusive jurisdiction of all of the federal and state courts in the Commonwealth of Massachusetts. 13. Waivers. The failure of the Company at any time to exercise any option or right hereunder shall not constitute a waiver of the Company's right to exercise such option or right at any other time. IN WITNESS WHEREOF, this Note has been executed and delivered as a sealed instrument as of the date first set forth above. /s/ Eric R. Giler --------------------------------- Eric R. Giler Executed, sealed and delivered in the presence of: /s/ Robert C. Leahy - --------------------------------- Name of Witness: Robert C. Leahy - 3 - EX-99.4 4 b56856biexv99w4.txt PROMISSORY NOTE DATED MARCH 3, 2000 - $298,546.88 Exhibit 4 NONRECOURSE PROMISSORY NOTE AND SECURITY AGREEMENT $298,546.88 March 3, 2000 FOR VALUE RECEIVED, Eric R. Giler, who resides at [address omitted] (hereinafter referred to as the Employee), hereby promises to pay to the order of Brooktrout, Inc., a Massachusetts corporation with its principal place of business at 410 First Avenue, Needham, Massachusetts 02494 (hereinafter referred to as the Company), the principal amount of Two Hundred Ninety Eight Thousand Five Hundred Forty Six Dollars and Eighty Eight Cents ($298,546.88) subject to the terms and conditions set forth herein. 1. Purpose and Authority. This Promissory Note and Security Agreement (the Note) is entered into for the purpose of financing the Employees exercise of options with respect to 28,125 shares of common stock of the Company (the Shares) pursuant to and subject to the terms and conditions of (i) the Company's policy on loans to executive officers, and (ii) the 1992 Stock Incentive Plan, as amended from time to time. 2. Security. The Employee hereby grants the Company a security interest in 28,125 Shares (hereinafter referred to as the Collateral Shares) and in any and all distributions and dividends which may from time to time be, paid or payable on the Collateral Shares from and after the date hereof. Employee agrees to take all such actions and execute all such documents as may from time to time be reasonably requested by the Company to perfect and maintain the validity and priority of any security interest granted to the Company pursuant to this Note. Employee also agrees that a carbon, photographic or other reproduction of this Promissory Note and Security Agreement may be filed as a financing statement to the extent that the Company determines that such filing is necessary for the Company to establish or maintain its security interest in the Collateral Shares. 3. Maturity. The entire principal balance shall be due and payable on or before 8/26/07 (the Maturity Date). 4. Interest. The Note will bear no interest. 5. Prepayment. The Employee may prepay the whole or any part of the principal amount of this Note from time to time without premium or penalty. In the event the Employee prepays any part of the principal amount of this Note, the number of Collateral Shares shall be proportionately reduced. 6. Payment. (a) The Employee shall pay the entire outstanding balance of this Note on or before the earlier of: (i) that date which is ninety (90) days after termination of the Employees employment with the Company; or (ii) the Maturity Date. (b) The Employee may, at his election, pay the entire outstanding balance of this Note by either (i) cash payment or (ii) irrevocably tendering to the Company all of the remaining Collateral Shares, regardless of the value of the remaining Collateral Shares at such time. The Company and the Employee agree that in the event the Employee makes payment pursuant to this Section 6(b)(ii), the entire outstanding balance of this Note shall be deemed to be equal to the value of the remaining Collateral Shares. (c) If the Employee fails to pay the outstanding balance of this Note at the time such outstanding balance is due and payable, the Company may, except as otherwise provided herein, exercise the rights and remedies accorded a secured party by the Uniform Commercial Code as enacted in the Commonwealth of Massachusetts. 7. Nonrecourse. Except as specifically provided with respect to the Collateral Shares, this Note shall be without recourse against the Employee or his assets. The Company and the Employee agree that the Employee shall have no personal liability for any deficiency which may arise upon a foreclosure and sale or other disposition of the Collateral Shares. 8. Modification. Neither this Note nor any provision hereof may be modified, altered, or amended in any manner or form except by an agreement in writing, executed by a duly authorized officer of the Company and the Employee, which writing shall make specific reference hereto. 9. Transfer by Employee. Employee will not sell, assign, transfer or otherwise dispose of, directly or indirectly, nor grant any option with respect to, or pledge or grant any security interest in or otherwise encumber any of the Collateral Shares or any interest therein, except for the security interest provided for in this Note. 10. Severability. If for any reason any provision or provisions hereof are determined to be invalid, unenforceable or contrary to any existing or future law, such invalidity or unenforceability shall not impair the operation or affect those portions of this Note which are valid. 11. Limitations by Law. All agreements between the Employee and the Company are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of the indebtedness or otherwise, shall the amount paid or agreed to be paid to the holder for the use, forbearance or detention of the indebtedness evidenced hereby exceed the maximum amount which the holder is permitted to receive under applicable law. If, from any circumstances whatsoever, fulfillment of any provision of this Note, at the time performance of such provision shall be due, shall involve payments exceeding such amount, then the obligation to be fulfilled shall automatically be reduced to the limit of such maximum amount. As used herein, the term Applicable law shall mean the law in effect as of the date hereof. This provision shall control every other provision of this Note. 12. Governing Law. The execution, delivery and performance of this Note shall be governed by, construed, and enforced in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to conflicts of laws principles, and each of the parties - 2 - consents to the non-exclusive jurisdiction of all of the federal and state courts in the Commonwealth of Massachusetts. 13. Waivers. The failure of the Company at any time to exercise any option or right hereunder shall not constitute a waiver of the Company's right to exercise such option or right at any other time. IN WITNESS WHEREOF, this Note has been executed and delivered as a sealed instrument as of the date first set forth above. /s/ Eric R. Giler --------------------------------- Eric R. Giler Executed, sealed and delivered in the presence of: /s/ Robert C. Leahy - --------------------------------- Name of Witness: Robert C. Leahy - 3 - EX-99.5 5 b56856biexv99w5.txt PROMISSORY NOTE DATED MARCH 3, 2000 - $132,750.00 Exhibit 5 NONRECOURSE PROMISSORY NOTE AND SECURITY AGREEMENT $132,750.00 March 3, 2000 FOR VALUE RECEIVED, Eric R. Giler, who resides at [address omitted] (hereinafter referred to as the Employee), hereby promises to pay to the order of Brooktrout, Inc., a Massachusetts corporation with its principal place of business at 410 First Avenue, Needham, Massachusetts 02494 (hereinafter referred to as the Company), the principal amount of One Hundred Thirty Two Thousand Seven Hundred Fifty Dollars and ($132,750.00) subject to the terms and conditions set forth herein. 1. Purpose and Authority. This Promissory Note and Security Agreement (the Note) is entered into for the purpose of financing the Employees exercise of options with respect to 11,250 shares of common stock of the Company (the Shares) pursuant to and subject to the terms and conditions of (i) the Company's policy on loans to executive officers, and (ii) the 1992 Stock Incentive Plan, as amended from time to time. 2. Security. The Employee hereby grants the Company a security interest in 11,250 Shares (hereinafter referred to as the Collateral Shares) and in any and all distributions and dividends which may from time to time be, paid or payable on the Collateral Shares from and after the date hereof. Employee agrees to take all such actions and execute all such documents as may from time to time be reasonably requested by the Company to perfect and maintain the validity and priority of any security interest granted to the Company pursuant to this Note. Employee also agrees that a carbon, photographic or other reproduction of this Promissory Note and Security Agreement may be filed as a financing statement to the extent that the Company determines that such filing is necessary for the Company to establish or maintain its security interest in the Collateral Shares. 3. Maturity. The entire principal balance shall be due and payable on or before 10/18/09 (the Maturity Date). 4. Interest. The Note will bear no interest. 5. Prepayment. The Employee may prepay the whole or any part of the principal amount of this Note from time to time without premium or penalty. In the event the Employee prepays any part of the principal amount of this Note, the number of Collateral Shares shall be proportionately reduced. 6. Payment. (a) The Employee shall pay the entire outstanding balance of this Note on or before the earlier of: (i) that date which is ninety (90) days after termination of the Employees employment with the Company; or (ii) the Maturity Date. (b) The Employee may, at his election, pay the entire outstanding balance of this Note by either (i) cash payment or (ii) irrevocably tendering to the Company all of the remaining Collateral Shares, regardless of the value of the remaining Collateral Shares at such time. The Company and the Employee agree that in the event the Employee makes payment pursuant to this Section 6(b)(ii), the entire outstanding balance of this Note shall be deemed to be equal to the value of the remaining Collateral Shares. (c) If the Employee fails to pay the outstanding balance of this Note at the time such outstanding balance is due and payable, the Company may, except as otherwise provided herein, exercise the rights and remedies accorded a secured party by the Uniform Commercial Code as enacted in the Commonwealth of Massachusetts. 7. Nonrecourse. Except as specifically provided with respect to the Collateral Shares, this Note shall be without recourse against the Employee or his assets. The Company and the Employee agree that the Employee shall have no personal liability for any deficiency which may arise upon a foreclosure and sale or other disposition of the Collateral Shares. 8. Modification. Neither this Note nor any provision hereof may be modified, altered, or amended in any manner or form except by an agreement in writing, executed by a duly authorized officer of the Company and the Employee, which writing shall make specific reference hereto. 9. Transfer by Employee. Employee will not sell, assign, transfer or otherwise dispose of, directly or indirectly, nor grant any option with respect to, or pledge or grant any security interest in or otherwise encumber any of the Collateral Shares or any interest therein, except for the security interest provided for in this Note. 10. Severability. If for any reason any provision or provisions hereof are determined to be invalid, unenforceable or contrary to any existing or future law, such invalidity or unenforceability shall not impair the operation or affect those portions of this Note which are valid. 11. Limitations by Law. All agreements between the Employee and the Company are hereby expressly limited so that in no contingency or event whatsoever, whether by reason of the indebtedness or otherwise, shall the amount paid or agreed to be paid to the holder for the use, forbearance or detention of the indebtedness evidenced hereby exceed the maximum amount which the holder is permitted to receive under applicable law. If, from any circumstances whatsoever, fulfillment of any provision of this Note, at the time performance of such provision shall be due, shall involve payments exceeding such amount, then the obligation to be fulfilled shall automatically be reduced to the limit of such maximum amount. As used herein, the term Applicable law shall mean the law in effect as of the date hereof. This provision shall control every other provision of this Note. 12. Governing Law. The execution, delivery and performance of this Note shall be governed by, construed, and enforced in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to conflicts of laws principles, and each of the parties - 2 - consents to the non-exclusive jurisdiction of all of the federal and state courts in the Commonwealth of Massachusetts. 13. Waivers. The failure of the Company at any time to exercise any option or right hereunder shall not constitute a waiver of the Company's right to exercise such option or right at any other time. IN WITNESS WHEREOF, this Note has been executed and delivered as a sealed instrument as of the date first set forth above. /s/ Eric R. Giler --------------------------------- Eric R. Giler Executed, sealed and delivered in the presence of: /s/ Robert C. Leahy - --------------------------------- Name of Witness: Robert C. Leahy - 3 - EX-99.6 6 b56856biexv99w6.txt NOTICE OF ELECTION TO REPAY OUTSTANDING LOANS NOTICE OF ELECTION TO REPAY OUTSTANDING LOANS UNDER THE BROOKTROUT, INC. STOCK OPTION LOAN PROGRAM August 18, 2005 In connection with the execution of the Agreement and Plan of Merger, dated as of the date hereof (the "Merger Agreement"), by and among Brooktrout, Inc. (the "Company"), EAS Group, Inc. (the "Buyer"), and a wholly-owned subsidiary of the Buyer, the undersigned hereby irrevocably elects, in accordance with Section 6(b) of each Nonrecourse Promissory Note and Security Agreement identified on Exhibit A or Exhibit B hereto executed by the undersigned in favor of the Company (each, a "Note"), as follows: (1) to pay, effective as of immediately prior to the Effective Time, the entire outstanding loan balance of each Note identified on Exhibit A hereto by irrevocably tendering to the Company all of the remaining Collateral Shares (as defined in the applicable Note) relating to such Note and identified on Exhibit A; and (2) to pay, as promptly as practicable after the Effective Time, the outstanding loan balance of each Note identified on Exhibit B hereto, in cash, by authorizing the Buyer to reduce, and the undersigned hereby authorizes the Buyer to reduce, the Merger Consideration payable to the undersigned under the Merger Agreement in respect of the Collateral Shares (as defined in the applicable Note) relating to such Note and identified on Exhibit B by the amount of the outstanding balance of such Note. The undersigned hereby covenants and agrees to take, or cause to be taken, all actions, and do, or cause to be done, and to assist and cooperate with the Company in doing, all things necessary, proper or advisable to consummate and make effective the transactions described above, including executing and delivering to the Company one or more stock powers evidencing the transfer of certain Collateral Shares to the Company as well as such other agreements, consents, waivers, instruments or other documents in necessary, proper or advisable in connection herewith. This election shall be null and void upon the earlier of (i) December 31, 2005, if the Merger is not consummated on or before such date; and (ii) the termination of the Merger Agreement in accordance with its terms. Capitalized terms used herein but not defined shall have the meaning ascribed to such terms in the Merger Agreement. EXECUTIVE /s/Eric R. Giler -------------------------------------- Eric R. Giler EXHIBIT A NOTES TO BE PAID BY TENDER OF COLLATERAL SHARES
NO. OF COLLATERAL DATE OF NOTE OUTSTANDING LOAN AMOUNT SHARES TO BE TENDERED ------------ ----------------------- --------------------- March 3, 2000 $2,330,233.88 103,612
EXHIBIT B NOTES TO BE PAID BY CASH PAYMENT
NO. OF COLLATERAL DATE OF NOTE OUTSTANDING LOAN AMOUNT SHARES UNDERLYING NOTE ------------ ----------------------- ---------------------- March 3, 2000 $298,546.88 28,125 March 3, 2000 $132,750.00 11,250
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